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COLUMN: EDDs gone wild as trust in government tanks

Setting aside the philosophical argument about EDDs in general, the way these particular districts are designed is problematic.

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Charter transition committee struggles through the stickiest part of consolidation

The gist: Nearly wrapped up after three months of biweekly meetings (the every other week kind), the committee charged with smoothing Lafayette’s transition to government by two councils wrestled with the essence of consolidation: cost allocation between city and parish funds for common services. Members lamented political tension to come. 

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Hold up. What’s cost allocation? Glad you asked. It’s basically how LCG splits the check between city and parish money. LCG has one public works department, one planning department, one finance department, etc. But the law requires that city funds go to city services and parish funds to parish services. About two dozen accounting methods are used to determine how much each general fund — a pool of unrestricted dollars — should pony up to run the government. 

“People’s salaries are charged all over the place,” LCG Chief Financial Officer Lorrie Toups told the committee Tuesday. That about sums up the challenge. Cutting or adding cost from either budget — i.e. by either council — isn’t necessarily straightforward. 

The big elephant. That’s what Tax Assessor Conrad Comeaux called cost allocation. Essentially, observers expect that unlocking allocation is a pandora’s box for dysfunction in consolidated government. Both city and parish funds are constrained now, and adjusting allocations between two bodies could be the theater of political conflict going forward.  

City taxpayers bear most of the cost of consolidation. Around 80% of shared costs are paid for by the city general fund. Since Mayor-President Joel Robideaux took office, the city’s share has increased $20 million because of changes in allocation. The parish share fell $9 million. 

“It was a noble gesture to create this new form of government,” District Attorney Keith Stutes said in closing remarks. Stutes probed whether the city and parish general funds could be mixed into one account but backed away from the recommendation, instead pleading for the incoming administration and councils to find common ground. “I have to say it’s disconcerting to see that it’s devolved into a combat,” he said of city-parish budget tension. In 2016, Stutes sued LCG for not adequately funding his office, a cost on parish government mandated by the state, but later dropped it.

The committee will produce a memo of questions and recommendations. The committee meetings have often been an education in existing problems in consolidation. The transition kicked off late in the year, convened in August by Robideaux after a protracted legal battle left the charter changes in limbo. It appears the new councils will likely need their own education on how to move forward, and will do so under intensifying financial pressure. The final committee meeting is Dec. 18.

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LPTFA steps in to pay for stopgap sewer fix Downtown

The gist: The board of a Lafayette public trust voted to front the cost of adding a new sewer pump Downtown as an intermediate fix to the district’s nagging sewer capacity problem. 

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Clogged up. Downtown and Lafayette’s urban core in general suffer from aging and inadequate sewer infrastructure that developers say limits their ability to add apartment complexes and townhouses. The problem is particularly acute Downtown. Longterm, LUS is working on a $7 million infrastructure upgrade that would fix the problem and then some. But that’s not fast enough to accommodate what’s believed to be immediate demand for Downtown living. 

LPTFA stepped up with a stop gap. The deal calls for the Lafayette Public Trust Financing Authority to spend just under $1 million to build a lift pump station on Grant Street property owned by LPTFA. LUS will reimburse the trust. 

“We feel it’s in the interest of Downtown for us to step up,” Rebekke Miller says. Miller is the program coordinator for LPTFA, which is in the process of building a 70-unit market rate project near Downtown.  

1,800 beds. That’s the total new capacity expected to be unlocked by the lift pump, according to LUS. A 2017 market study estimated Downtown could support up to 1,110 residential units. Downtown Development Authority CEO Anita Begnaud says the station would be complete by December 2020, in time to accommodate several new developments, including the old federal courthouse. 

“I think you’re going to see another 200 units once [developers] see the capacity,” Begnaud says. Developers have been unable to secure financing for projects without commitments from LUS that the developments will have sewer facilities. Several smaller-scale developments are waiting in the wings behind the roughly 200 units of new housing currently underway. 

Why this matters. Downtown has been stuck in a development quagmire for years while advocates clamor to bring urban living to Lafayette. This year, employer announcements — Waitr and CGI — stoked optimism for a boom. But infrastructure limitations remain an obstacle. Downtown officials are pushing to create a new sales tax district to finance infrastructure improvements, which the City-Parish Council will vote on Dec. 17.

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Controversial political advocacy attracts new elected officials to fundraiser

The gist: Hardline conservative advocacy Citizens for a New Louisiana, which began life as a Facebook gadfly, attracted several incoming officials, including the mayor-president-elect, to a fundraiser and social gathering last week. 

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Five incoming councilmembers and the mayor-president-elect appeared. Michael Lunsford, Citizens’ executive director and the organization’s front man, says 60 attendees showed up for a social affair that spilled out of his office Downtown, in the refurbished Gordon Hotel building on Jefferson Street. The event was ticketed with a suggested donation of $150. Josh Guillory gave a short speech in a relatively brief appearance, according to Lunsford. During the campaign, Citizens called into question Guillory’s conservative bonafides and authenticity. 

Lunsford outlined a vision for growing the organization in remarks to supporters. He has added a part-time staffer to help with administration, and he intends to take on issues in neighboring parishes, with the long-term vision of replicating the Citizens “model” around the state. Lunsford himself does the bulk of the work, along with what he describes as a network of volunteers. He indicated some growing financial support, but declined to give figures. In 2018, Citizens took in $130,132, mostly from six unidentified contributors, according to a public tax filing provided by Lunsford. 

Council members say they were getting to know their constituents. Democratic Councilman Pat Lewis, an incumbent and the only incoming city councilman to appear, couched his interest as not one of support but of an open mind. Incoming parish Councilman John Guilbeau, a Republican, acknowledged the group’s controversy and lamented growing political strife in Lafayette Parish. Guilbeau described Citizens’ work as well-intentioned if overheated.

“Let’s stop this damn divisiveness,” Guilbeau says, conceding Citizens’ reputation. Guilbeau was one of four incoming parish council members who appeared. “But it goes both ways. Sometimes their rhetoric or information is a little sketchy. 

Citizens has been rebuked for divisiveness and misinformation, and at one time was the subject of a state ethics investigation. Sparked by a complaint filed anonymously to the board, the investigation sought out whether Citizens received contributions specifically to pay for a 2018 ad campaign overtly opposing a tax renewal for the parish library system and failed to disclose its donors. Citizens’ nonprofit structure doesn’t require releasing information about donors, but funds directly related to political activity would be subject to campaign finance disclosure. Lunsford’s group filed finance reports with the ethics board, claiming expenses related to that political campaign but listed itself as the only donor. The Current reported the investigation on Sept. 11 after obtaining court records related to it, which are typically confidential. The Louisiana Board of Ethics decided not to pursue the matter a month later and closed the file, saying in a letter addressed to Citizens’ attorney that the board had found “no evidence” that Citizens received money requiring campaign disclosures

“They reviewed the facts and they found us in compliance, which we knew we would be,” Lunsford says, calling the underlying allegations in the anonymous ethics complaint “a bunch of hooey.” 

Even council members who took fire from Citizens RSVP’d. Councilwoman Nanette Cook, who is currently on the consolidated council and beat out a candidate more closely aligned with Citizens for her incoming seat on the city council, says she wanted to hear what Guillory had to say — a rare opportunity for an audience with a busy public official. (Lunsford says Guillory rehashed campaign talking points. A request for comment from Guillory was not returned.) Cook and fellow incumbent councilmember Kevin Naquin, headed for the parish council, were at one point advertised as confirmed guests but were unable to attend. Both have taken shots from Citizens.

“We have a new government, and regardless of what they think of me, I’m ready to get on board and move this community forward,” Cook says. She anticipates blowback on her support for six economic development districts before the council Dec. 17. Lunsford will sit on a panel Wednesday evening organized in opposition to the districts. “We don’t really agree on a lot of things,” Cook says.

Why this matters. Citizens has been near the center of big local controversies, most prominently digging in on major tax propositions, often with misleading information, and stoking intolerant outrage on lightning-rod social issues. Now, with a shingle hung Downtown, it’s become a brick and mortar organization that attracts attention from local officials.

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Architect Henry Boudreaux ordered to pay $1.1 million in restitution

“We put on the record that we had evidence the fraud and the theft just for the Blanchets was in excess of $2 million, and the defense agreed to that,” Assistant District Attorney Kenny Hebert says.

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Experts sound the alarm over Garber’s cuts to diversion programs

The gist: After what his office called “repeated attempts to secure critical funding for daily operations,” Sheriff Mark Garber confirmed Tuesday that he is cutting 42 mostly corrections jobs from his workforce of 748. A press release announcing the reduction in personnel included more cuts to diversion programs started and expanded under his predecessor and long held up as successful models of prison reform and reintegration.

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Council Preview: paying for pay raises, Girard Park rezoning, Coca-Cola redevelopment, and daiquiris delivered

Tuesday is the City-Parish Council members’ second-to-last meeting ever, and they’re not phoning it in. Here’s what on the agenda for Dec. 3. 

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UL’s watershed center engaged to complete Vermilion River dredging study; report expected in January

The gist: The U.S. Army Corps of Engineers has contracted UL’s Watershed Flood Center to model the effect of dredging the Vermilion River. This would complete a long-awaited study — at one time expected to be finished at year’s end — that will determine the benefits and risks of digging out years of accumulated mud and debris that have shallowed […]

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Robideaux brings sensitive LUS review into public arena

The gist: Challenged by the council to be more transparent, Mayor-President Joel Robideaux delivered to the Lafayette Public Utilities Authority potentially damaging comments gathered by the administration during its investigation of payments by LUS to LUS Fiber.

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Get caught up, quickly. LUS and LUS Fiber have been under fire for a pair of potential violations of a state law that prohibits government dollars from propping up the municipal telecom. The most recent of the two, $8 million paid over eight years for a power outage monitoring system, was self-reported by Robideaux in July. In a press release distributed Oct. 11, Robideaux announced he was removing LUS and Fiber’s interim directors, claiming the swap was made to “facilitate an internal review on behalf of the Public Service Commission,” and connected the review to the power outage monitoring payments. The PSC denies any involvement and has distanced itself from Robideaux’s attempts to link his efforts to its limited oversight. Robideaux named his chief administrative officer, Lowell Duhon, to oversee LUS, and Kayla Miles Brooks, Fiber’s business administrator, as LUS Fiber’s interim director, replacing Jeff Stewart and Teles Fremin, respectively. LUS’s consulting engineer has deemed Duhon and Brooks unqualified for the posts.

Once closely held and secretive, the review was center stage at a special joint meeting of the council and the LPUA. Lafayette Public Utilities Authority Chairman Bruce Conque requested the meeting after a pointedly challenging email to Robideaux from Councilman Jay Castille, a frequent critic. “I think everyone agrees that if there was a violation of the law, that would be a very serious allegation,” Castille wrote the mayor on Nov. 13. “I think all anyone wants is a ‘comprehensive, complete and honest analysis.’ But the way you have handled this entire matter makes many doubt your sincerity.”

Castille, who declined to comment for this story, had also called the mayor to task for being untruthful about the Public Service Commission’s role in the ongoing review; Robideaux has said, and repeated Tuesday, that Public Service Commissioner Craig Greene asked for a wider inquiry of the relationships between LUS, LCG and Fiber. Greene’s office denies it played any role. The Lafayette Public Utilities Authority, a subcommittee of the council, regulates LUS, and the PSC has limited oversight over LUS and Fiber, ensuring they comply with provisions of the Local Government Fair Competition Act. 

Robideaux’s presentation came on the heels of a press conference called abruptly last week by former LUS/LUS Fiber Director Terry Huval, in which Huval defended the power outage monitoring system’s pricing and usefulness.

In his remarks, Robideaux responded to criticism with what may be the most damaging information to date. He released emails and anonymous comments gathered in interviews recorded under attorney-client privilege during the investigation into the power outage payments to LUS Fiber. The complete context of the comments isn’t clear, and Robideaux seemed to attempt to attribute the statements to eight people interviewed, including LUS’s and Fiber’s former interim directors, an LCG accountant, an auditor and two attorneys who work on LUS matters. (You can view his full presentation and comments here.)

“In my opinion, I’ve always thought it was kind of a stretch … as someone who works in the industry, that’s why we are eliminating it, to be honest with you,” said one interviewee. And another: “We need to let it fall off the books because we’re not seeing the justification.”

Former LUS and LUS Fiber Director Terry Huval defended the decision to implement POMS and the benefits of the system at a press conference last week. Photo by Travis Gauthier

Huval continues to stand by the POMS decision. “Last week, I explained how we incorporated the beneficial use of technology on the LUS system that resulted in significantly reduced electric outage durations, while still maintaining the lowest rates in the state,” Huval wrote in response to a request for comment. “During the implementation of such technological upgrades, I did not receive any indication by LUS staff or consultants that any of these initiatives were not cost effective. LUS customers are receiving the best service ever because of initiatives such as these.” (View Huval’s presentation here.)

Why this matters: Robideaux presented what may be the most compelling evidence to date that some LUS insiders suspected the power outage monitoring payments were a way to prop the fiber division up at a time it desperately needed cash flow. Should a new PSC audit determine the service was mispriced or unnecessary, the money may have to be paid back to LUS with interest, delivering a financial blow that could jeopardize the future of LUS Fiber. Robideaux is expected to give the LPUA an update by mid-December and complete the review by the end of the year. 

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The Trump effect, the city/rural divide and Lafayette’s 2019 election postmortem

The 2019 election season is officially under wraps, showcasing hard-fought campaigns and matched enthusiasm among voters. Here’s a breakdown of the results.

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Special taxing districts for Downtown, Northside, Acadiana Mall and more move forward

The gist: Six new economic development districts passed introduction Tuesday by the City-Parish Council, in a rush of legislation on the council’s waning agenda for the year. The districts would levy new sales and hotel taxes to make improvements advocates say would spark economic activity in areas that need it. A vote on final adoption is set in December. 

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Here are the six districts: Downtown, University Gateway, Trappey Riverfront Development along the Vermilion River, Northway District anchored by Northgate Mall, Holy Rosary Institute and the Acadiana Mall.  

Taxes would be confined to district boundaries. The districts propose different tax rates and sunsets — varying between 1% and 2% sales and 1% and 2% hotel occupancy — but follow more or less the same structure. Council members — for the time being, from the City-Parish Council — will serve as each district’s governors, with the power to levy taxes, and will enter a cooperative endeavor agreement with private or public entities and the city of Lafayette. 

Half of the districts are on the northside. The area has long been in decline. Advocates argue consolidated government has not prioritized infrastructure and economic development needs on that side of town. Proponents view the districts as essential tools for bootstrapping prosperity. Rehabbing and redeveloping blighted property, streetscaping and land acquisition are on all three northside district lists. The Holy Rosary district prioritizes repairs of the historic school itself, construction of an African-American heritage museum and building a medical clinic. 

“We know we need economic development on the Northside,” said Ravis Martinez, part of a private development linked to the Northgate Mall district, in remarks Tuesday night. “When are we going to invest on the Northside of Lafayette? When are we going to take a hard look at ourselves, a hard look at the big box facilities and stores moving out? What are we going to do for the Northside of town?”  

Downtown advocates say they need the money. A lack of sewer capacity Downtown has choked the district’s ability to attract residential development. LUS rolled out a multimillion dollar sewer infrastructure upgrade intended to address the problem, but it won’t be complete for several years. Anita Begnaud, CEO of the Downtown Development Authority, tells The Current the district will give Downtown some independence in getting basic and necessary infrastructure in place.

“People want to develop here. The reality is nobody can get a bank to give them $1 million upfront to build a lift station,” Begnaud says. “Something’s got to be done to lift that hurdle.” 

The districts’ boundaries exclude registered voters. This is a common practice in drafting economic development districts. Without registered voters in the districts, the governing authority can levy taxes without a general election that would otherwise be required to be held for the voters within the districts. In Downtown’s case, drawing the district this way makes for a patchwork map that excludes addresses with registered voters associated. In some cases, people use commercial properties as their registered address, which then excludes those businesses from the district. 

“Almost every EDD is created on a greenfield site where there are not registered voters,” Begnaud says.

Critics take issue with the bundling of several districts at the tail end of an outgoing government. On top of the question of timing, there has been fierce ideological opposition to this financing approach, particularly among staunch conservatives who view the mechanism as a form of crony capitalism and a distortion of the free market. 

“This is all new in Lafayette, and it’s moving awfully fast,” said Councilman William Theriot, one of only two votes against establishing the districts, joined by fellow conservative council member Jared Bellard. Bellard and Theriot have both consistently opposed the financing strategy — often broadly referred to as tax increment financing districts or TIFs. Councilwoman Liz Hebert moved to defer the batch of ordinances carrying the districts until next year but was voted down by advocates urging immediate action. 

Lafayette has experimented with economic development districts before. The Target-anchored shopping center on Louisiana Avenue was built using a similar financing strategy. Proponents touted the development’s success as a proof of concept Tuesday night, arguing it should be put to good use within Lafayette’s urban core. 

What’s next? Should the districts pass final adoption in December, their governing boards — effectively the members of the City-Parish Council and, later, the City Council — would have to approve levying the proposed taxes. That means Dec. 17 isn’t necessarily the final stop. Council members could create the districts and approve the CEAs but punt levying the taxes to the City Council. Based on the conversation Tuesday, there was little appetite for waiting.

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Outgoing council approves pay raises, digging a deeper hole for the next

The gist: The City-Parish Council approved pay raises for the fire department, public employees, and the marshal’s office Tuesday. In total, these raises increase annual expenses for the city general fund by $3.7 million and the parish general fund by another $60,000. Without offsetting revenue gains or cuts to expenses, both the city and parish general funds are projected to go broke in the next few years.

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Get caught up quickly: Earlier this month the council approved $3.8 million in raises for the Lafayette Police Department. Combined with funds approved Tuesday for city employees, the city general fund is projected to have to tap into more than $18 million of its $45 million fund balance over the next fiscal year. If nothing else changes, that puts the city general fund on track to go broke by 2023, according to numbers provided by LCG Chief Financial Officer Lorrie Toups. Parish general expenses will only increase $60,000, but that will reduce its projected fund balance by 60% and put it in the red by 2021.

No one questioned that these raises are warranted. While none of the votes to approve these raises were unanimous, not a single member of the public or council or the administration argued against the merits of giving them. Interim City Marshal C. Michael Hill went so far as to suggest that the pay increases for his deputies weren’t even raises. That’s because they hadn’t received pay increases in four years, yet their costs for expenses like health insurance premiums had gone up. So that means their take home pay has actually been decreasing over the last four years.

But there was no discussion about how to pay for these increased expenses. At the Nov. 5 meeting, Councilman Jared Bellard introduced a measure to eliminate all budgeted but vacant positions to free up money for raises for first responders, but the measure was deferred until the next meeting on Dec. 3. Approving these raises, the last consolidated council has set the next city and parish councils on a difficult path for their first term. 

And there still might be one more raise to come. The only dissenting voice on the matter of giving raises to LCG’s civil service employees was City Judge Doug Saloom. While he didn’t speak out against giving these raises, he instead argued that his 36 employees shouldn’t be left out just because they work under the judicial system. He was encouraged to submit an introductory resolution by today’s noon deadline to get onto the agenda for the next council meeting and indicated he planned to do so. Given the number of employees, though, any additional expenses incurred by giving these raises should be modest relative to the size of the financial challenges now facing the city’s budget.

What to watch for: Just how bloody next year’s budget cycle looks like for both the city and the parish. The parish has already cut budgets year after year, struggling to maintain even a $100,000 balance in its general fund. Now there will be even less room to maneuver with these increased expenses. The city was projected to tap into its general fund to maintain baseline operations for the next few years before the pay raises were added. Now the city general fund will be projected to fall below the 20% minimum fund balance set by LCG’s fiscal policy by 2021 and be completely zeroed out by 2023. Given that neither the parish nor city general fund balance can legally go below zero, more cuts are likely coming.

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