The general assumption has been that the parish is broke but the city is doing fine. When you dig into the latest budget, a more troubling reality emerges.
Everyone knows Lafayette’s roads are bad. But some roads are so bad they’re a public safety hazard. Unfortunately there’s just not enough money to fix them, and the problem is getting worse every year.
Some want to claim that the only thing preventing us from fixing our flooding issues is a shift in priorities. But the reality is that the parish can’t afford to fix its drainage system without more revenue.
The gist: The City-Parish Council voted Tuesday night to call an election this fall to redirect $10 million of the library’s $26 million fund balance to unidentified infrastructure and parks and rec projects.
That’s less than originally proposed — and with an allocation for parks. An amendment offered by Councilman Jay Castille moved $2 million to parks and $8 million to drainage. Mayor-President Joel Robideaux’s original proposal, floated back in January, was $18 million for roads, bridges and drainage only. Robideaux argued then that such a large redirection would still leave the library with more than enough money to continue operations, a position the administration maintained in council discussion. They mayor’s argument is based on projections that the library’s property tax revenue will grow by more than 100% over the next 11 years, despite that it grew by only about 1% the last two years. Voters will weigh in on the October ballot.
The council voted 6-2 in favor of this amended resolution. Voting no were William Theriot and Jared Bellard, two of the original resolution’s co-authors.
“Robideaux’s proposal was done without library input, so how could he know what we need?” Andrew Duhon, the library’s vice chair, asked the council. He argued that the original proposal didn’t account for potential lower projections for property tax revenue growth, noting that property tax revenue flatlined in the 1980s.
Opponents of the amended proposal say including parks and rec could kill it at the ballot box. Theriot and Bellard made the case that parishwide voters are more worried about flooding than parks and recreation. “Why would we want to invest money in other things if people can’t protect their homes?” Theriot asked.
Councilman Kenneth Boudreaux is stumping for a library east of I-49. He supported lowering the amount of money transferred to pay for it. No library exists east of the Evangeline Thruway, he said, lamenting that kids from those neighborhoods, low income areas with poor rates of literacy, need to bike across the highway to get to a library. “We want a library like everybody else,” he said.
Duhon believes the library could pay for a new library on the Northside, even if some of its fund balance is shifted, and that Boudreaux makes a compelling case for it. But it’s not clear the library can afford to staff and operate a new facility. The library is projected to collect about $2 million less in tax revenue than it costs to operate the system’s existing facilities next year. To maintain current operations it’s going to have to dip into its fund balance. If property tax revenue flatlines or declines, it won’t be long before it will be forced to cut its existing budget by 20% or more. In other words, there’s money to build a library but there may not be money to staff it. The library board has opted not to recommend “rolling forward” — collecting at its highest possible rate — one of its remaining two property taxes, a decision that could reduce projected income by as much as $800,000 annually.
We have to pass the transfer to know how the money’s going to be spent. The administration has not detailed which projects the redirected dollars would go to. Also unknown is the mix of drainage, roads and bridge improvements. Same goes for the parks and rec allocation.
$10 million may sound like a lot of money, but it’s dwarfed by project needs. Public Works reports a backlog of $97 million in road projects alone on top of tens of millions of dollars in drainage maintenance work. A comprehensive overhaul of the drainage system, which some believe is the only real solution, could cost hundreds of millions of dollars.
One big takeaway: The council doesn’t seem to agree on the same set of facts. At no point during last night’s discussion did it seem like anyone had the same understanding of the library’s financial situation, or the potential long-term impact of transferring some of its surplus for other needs.
Walmart’s decision shines a light on serious issues with no easy answers.
Recent headlines indicate 2018 might be the year our economy started recovering. But there’s ample evidence that any optimism should be guarded given the situation our economy’s in.
Voters demand flexibility and quick responses, but representatives are hamstrung in their ability to divert dedicated funds.
The gist: Year-to-date sales in Lafayette Parish approached $5.5 billion through November 2018, according to a release from LEDA, on pace to surpass $6 billion. That puts local commerce in shouting distance of 2014’s $6.4 billion peak with a month of reports to go.
Total taxable sales in the parish were up 4.4 percent from 2017 and 5.6 percent from 2016 in that time period.
But the city’s lagging behind: The city of Lafayette performed the worst among municipalities, up only 1.4 percent, compared with 28.2 percent in Duson, 19.3 percent in Youngsville, 17.3 percent in Scott, and 9.2 percent in Carencro. Even unincorporated Lafayette Parish beat the city with a 3.7 percent uptick.
More than 70 percent of the total retail sales in the parish happen in the city of Lafayette. It’s still the region’s shopping anchor. In the city, apparel, general merchandise and building material sales are all down from last year. LEDA CEO Gregg Gothreaux says that’s in part due to belt-tightening and a correction from flood-related boosts in construction.
“The downturn forced people to curtail spending,” Gothreaux says. “Apparel is something that can easily be put off, and the sales numbers over the past four years reflect that. People focused on purchasing necessities — looking for the best bargains — or may have occasionally splurged at the hot, new store. The 2016 flood spurred a modest increase in building materials sales that has since returned to pre-flood levels.”
Up but still down: While the parish’s performance might be up from last year, sales through November were off more than $300 million from 2014. The cities of Lafayette and Broussard and the unincorporated parts of the parish are all down more than $100 million each from where they were back then.
Up and up and up: But some parts of the parish have seen a steady rise in retail sales despite the economic downturn in the parish the last few years. Youngsville‘s up about $60 million since 2014, Scott about $40 million and Carencro more than $50 million.
Duson‘s all over the place: If you compare 2018 to 2014, Duson’s down about $1 million. But if you compare it to 2013, it’s up almost $11 million. But then if you compare it to 2012, it’s down more than $24 million. What’s going on in Duson?
More sales = more revenue for government, but in a good way: When total taxable sales go up, so too do sales tax revenues for schools, city governments, and economic development districts. That means more money for government without having to raise taxes. Modest increases in sales tax receipts in the unincorporated area helped patch a temporary budget hole when a plan to sell a parish-owned parking garage to the city fell through. Unincorporated Lafayette parish has been routinely raided of its sales tax revenue through annexations by nearby towns and cities.
Good news, but … Rising retail sales is an indisputably good thing. But Lafayette still has a ways to grow to recover lost ground. So while we celebrate finally getting some good economic news, let’s not forget that this just suggests the bleeding has stopped. There is still a lot of healing left to do.
Mayor-President Robideaux wants to rededicate $18 million from the library’s fund balance to pave roads and clean coulees, but there are hidden costs that must be accounted for.
How Sheriff Mark Garber’s sales tax attempts to solve all his financial troubles in one fell swoop, at the risk of failure.
On Nov. 6th we vote on whether to increase taxes for our parish courthouse and jail or instead to maintain the status quo. But the status quo is broken. Here’s why.
The gist: Lafayette Parish Tax Assessor Conrad Comeaux has just finished up the latest tax roll, confirming that Lafayette lost hundreds of millions of dollars in movable property since 2015.
$559 million: That’s the total decrease in movable property in Lafayette from 2015 to 2017.
What does “movable property” mean? Movable property refers to the property owned by businesses other than real estate, things like equipment and inventory.
How big of a deal is this? Compared to the overall value of real and movable property in Lafayette Parish of more than $20 billion, we’re only talking about a loss of a couple of percentage points. But when you look at movable property on its own, the decrease is more like 10 percent. What this means is 10 percent less tax revenue generated by movable property, which adds up to millions of dollars of lost income for Lafayette Consolidated Government, the Lafayette Parish School System, the Lafayette Parish Courthouse, and every other organization that relies on property tax millages to fund their operations.
$10 million: That’s the amount the total assessable value of the property tax roll increased from 2016-2017. The reason for this is that real estate values have continued to hold steady or go up, which has offset the losses in movable property. But even here the numbers don’t look great as the total value of real estate in the parish rose more than $400 million to about $18 billion in total. That means the total residential and commercial real estate values in Lafayette Parish only increased a bit more than 2 percent. On average nationally, commercial property values increased more than 7 percent and residential property values more than 5 percent. Put another way, if real estate values in Lafayette Parish had increased 5 percent instead of 2 percent and if movable property values had just held even, the market value of our property tax roll would be about a billion dollars higher and generating more than $10 million in additional tax revenue for the aforementioned entities.
But this is all just about oil and gas, right? While these trends may have started in oil and gas, they’ve spread throughout Lafayette’s economy as retailers are stocking less inventory and banks are seeing deposits go down. And while the value of real estate has been keeping our heads above water, we’re likely to start seeing that area get hit as well, as vacancy rates are higher in apartment buildings and occupancy rates are lower in hotels, both of which can negatively impact the value of those buildings and therefore put downward pressure on property tax revenues for LCG.