Posted in Budget, Governor's Office, Higher Education, Legislature, Legislators, Notable Quotables, Revenue on February 9, 2015| 2 Comments »
“As states prepare their budgets for the coming year, they face the challenge of reinvesting in public higher education systems after years of damaging cuts — the product of both the economic downturn and states’ reluctance to raise additional revenues.”
—From story by the Center on Budget and Policy Priorities, March 19, 2013.
Posted in Budget, Finances, Governor's Office, Higher Education, Layoffs, Legislators, Legislature, LSU, Politicians, Revenue on February 9, 2015| 8 Comments »
Louisiana’s colleges and universities are facing some difficult choices.
With the latest round of budget cuts to higher education announced by Gov. in Absentia Bobby Jindal, college presidents have been thrown into deep crisis mode in trying to figure out how to keep their schools afloat in the wake of another $350 million slashed from their cumulative budgets.
The LSU campuses are facing cuts of 35 percent to 40 percent, or about $141.5 million which translates to the elimination of 27 percent of faculty positions, 1,572 courses, 28 academic programs and 1,433 faculty and staff positions, according to Associated Press reporter Melinda Deslatte. http://theadvocate.com/home/11535937-125/lsu-outlines-dire-budget-scenarios
Because of Jindal’s disastrous fiscal policies over the past seven years, repeated budget cuts have been imposed on both health care and higher education.
Conspiracy theorists might attribute that to the goal of the American Legislative Exchange Council (ALEC) and its objective of “taking the state out of state colleges,” or including public colleges and universities in its stated drive toward near total privatization of government.
And those conspiracy theorists, in this case at least, might not be too far off.
As has already been reflected in tuition increases of 90 percent for state colleges and universities in Louisiana since Jindal took office (with more undoubtedly on the way), it’s rather easy to see what such privatization would mean: soaring tuition costs putting college out of reach for all but the wealthiest Americans absent the securing of ever-rising student loans from private banks with debts guaranteed by the federal government (ALEC wants privatization to go just so far, it seems).
The Center on Budget and Policy Priorities has conducted an exhaustive state by state study of cuts to higher education which show Louisiana has undergone some of the deepest cuts (fourth highest in the nation) at 43.6 percent from Fiscal Year 2008 (the year that began six months before Jindal assumed office in January of 2008) through FY-13 (2012-2013). There have been two additional cuts since then in Louisiana. The $4,714 per student cut through FY-13, for example, has increased to more than $5,000 since then in Louisiana. http://www.cbpp.org/cms/?fa=view&id=3927
The center’s report said state could have reduced the size of the spending cuts by enacting “significant new revenues, but many (including Louisiana) chose not to.”
It is an understatement to say that Louisiana colleges and universities are going to have to make some hard decisions, but the one issue that has flown under the radar thus far is intercollegiate athletics.
This is going to get some push back from the more rabid sports fans, especially at LSU which plays in the big leagues of the Southeastern Conference. Not to slight the other schools, but the reality is (as Jindal is fond of saying) the LSU athletic program is the only one in the state that is self-sustaining—but athletics could be adversely impacted in another key area: keeping players academically eligible.
You see, there is something out there called Section 504 of the Rehabilitation Act of 1973 which was written to protect the rights of individuals with disabilities.
Section 504 is employed by elementary and secondary schools to help students with learning and other disabilities but is especially popular in college athletic programs, according to one former high school coach who is familiar with the program.
Because any school receiving federal funding (which is all Louisiana colleges and universities) is mandated to provide extra assistance to those with learning disabilities. Section 504, therefore, is protected and exempt from any state cutbacks—much to the appreciation of college athletic programs.
Athletes with learning disabilities, and let’s be honest: there are a lot of college jocks who can’t read or write above fifth or sixth-grade levels and some have comprehension skills that fall lower than that, are provided special tutors. These tutors, our source tells us, not only do much of the students’ academic assignments for them, but even sit with them during testing, coaxing them on when they provide an incorrect answer and often even pointing to the correct answer.
(Had I had that kind of help at Louisiana Tech, I could have made the dean’s list other than the one I found myself on most of the time.)
There has been much written about Mary Willingham, the former academic advisor at the University of North Carolina who finally had enough and blew the whistle on so-called “paper courses,” or “counterfeit classes” for 18 years involving more than 160 student-athletes.
Willingham said athletes were literally funneled into the program as a means of keeping them eligible at the sacrifice of any semblance of a real education. The “paper classes” produced boiler plate papers that were shamelessly plagiarized. Professors in those classes rarely, if ever, bothered to read the papers but instead relied on counselors who simply advised the professors as to the grade an athlete needed to remain eligible, a practice they called “GPA boosters.”
Willingham said the “paper classes,” many of which were African and African-American studies, were openly discussed as a way to keep athletes eligible to participate in sports. One email from a counselor to a professor advised, “Yes, a D will be fine; that’s all she needs. I didn’t look at the paper but figured it was a recycled one as well, but I couldn’t figure out from where.”
Willingham called the system “corrupt because many of these young men are passed through the system without really being given what they’re promised, which is a real education.”
She said universities have lowered their admissions standards for athletes and the NCAA allows it to keep the revenue-producing sports going.
That’s because NCAA-level college football alone is a $16 billion (with a B) business for tax-exempt, “non-profit” universities which ostensibly are focused on research and education.
No wonder that subsequent to releasing her research on the poor literacy levels, UNC officials went to extreme of hiring outside academics in an attempt to discredit her findings.
We attempted to learn how many LSU athletes are currently participating in the Section 504 program. We submitted the following public records request:
Please provide any and all documents and/or public records that provide the following information;
The number of learning-disabled student athletes currently enrolled at the LSU Baton Rouge campus;
The percentage of learning-disabled student-athletes to the overall student population currently enrolled at the LSU Baton Rouge campus.
Please understand I am not asking for names—just the raw numbers and percentages of overall student population.
LSU responded that it had no record of such data, a claim we find extremely difficult to believe. Nevertheless, we tried once more, making the same request of Louisiana Tech. This time we received not so much as even a response to our request.
Never wishing to leave part of the story untold, LouisianaVoice did a little research of its own into some of the degree programs into which athletes may be “funneled,” to borrow a phrase from Willingham. We should preface what follows by stressing the samples of classes come directly from the LSU 2014-2015 catalog: http://catalog.lsu.edu/index.php?catoid=6
General Studies:
Sports Studies Minor: To graduate with a minor in sports studies, students must complete 18 semester hours from the following: KIN 2530 , three activity courses and 12 semester hours from the following courses: KIN 2502 , KIN 2511 , KIN 2525 , KIN 2526 , KIN 3507 , KIN 3800 , KIN 4513 , KIN 4515 , KIN 4517 , KIN 4800 , MKT 3410 .
Okay, you get the picture. Obviously, these are important courses. The beast must be fed so we can continue to kneel at the altar of intercollegiate athletics. Some things, after all, are sacrosanct. The option of cutting these programs is not even on the table.
So the cuts must be made elsewhere. But where?
Oh, such non-revenue producing programs as English, Arts, Physics, Engineering, Medical School (after all, who needs doctors after Jindal’s cuts to health care?), Business, Economics, History, etc. After all, who ever heard of TAF selling tickets to a science lecture?
Loss of accreditation of the business and engineering colleges? Hmpf, we don’t need no stinking accreditation when there’s a national championship to be won.
The alternative could be to sacrifice some of the courses we listed above in an effort at maintaining some semblance of academic integrity.
Of course, that would mean all athletes would have to take real courses—and pass. The lack of academic funding of the university and the resulting cancellation of the courses required for athletic eligibility will deal the death blow to athletic programs as we know them.
And that could have LSU playing Baton Rouge Community College in flag football next season.
Efforts to contact Les Miles and Johnny Jones for confirmation of the mothballing of the 2015 football and basketball seasons were unsuccessful.
We can only conclude that although Jindal, who has exhibited nothing but disdain and contempt for Louisiana’s education systems, knew of the consequences of his administration’s budget cuts on college and university athletic program, this was an “unintended consequence” by the legislature. To that, we can only say to legislators: “You should have done your homework and not sold your soul to Jindal for personal and political gain.”
(Thanks to Ruston High classmate John Sachs for the idea for this post.)
Posted in Contracts, DEQ, DHH, Economy, Elections, Exemptions, Finances, Governor's Office, Health Care, Higher Education, Incentives, Office of Group Benefits, OGB, Politicians, Privatization, Revenue, State Agencies, Teague on February 7, 2015| 35 Comments »
Some may think it’s too early to bury Jindal’s presidential ambitions just yet, but it is our humble opinion that Roy Orbison summed it up more than 50 years ago with his 1964 hit It’s Over.
What little spark that still burned in his fading presidential hopes has been snuffed out by a fast-paced series of events beginning with his incredibly idiotic rant about the Islamic no-go zones in Europe which then morphed into a tirade by Jindal shill Kyle Plotkin over the tint or lack of, in Jindal’s “official” portrait hanging in the reception area of the governor’s office on the fourth floor of the State Capitol.
Whether or not blogger Lamar White’s comment about Jindal’s “white-out” of his portrait which (a) makes him appear almost anemic or (b) makes him appear as if the anemic version caught a little too much sun at Gulf Shores (depending on which is the “official” portrait), the entire episode quickly descended to the level of ridiculous political theater.
And when the dialogue is reduced to arguments over the shade of color in a portrait Jindal has run out of issues for serious public debate and can no longer be taken seriously.
As a great singer, the late Roy Orbison, crooned back in 1964, It’s over.
And as our favorite writer, Billy Wayne Shakespeare from Denham on Amite would say (with certain literary license):
“Not that I loved Caesar Jindal less, but that I loved Rome Louisiana more. Had you rather Caesar lived Jindal were President and (we) die all slaves, than that Caesar were dead Jindal were forgotten, to live all free men?”
—Brutus Bob, from Julius Caesar, Act 3, Scene II.
“I have come here to bury Caesar Jindal, not to praise him. The evil that men do is remembered after their deaths, but the good is often buried with them difficult to find. It might as well be the same with Caesar Jindal. The noble Brutus Bob told you that Caesar Jindal was ambitious. If that’s true, it’s a serious fault, and Caesar Louisiana has paid seriously for it.”
—Marc “T-Boy” Antony, from Julius Caesar, Act 3, Scene II
If there was any lingering doubt, that was erased late Friday (notice the timing) when he released a laundry list of yet another round of budget cuts. As has become his practice, all bad news is announced late on Fridays so the impact will be lessened because people tend not to follow the news on weekends.
Among those cuts:
Jindal also some miraculously came up with $42.8 by sweeping several agencies, including $9 million from the Medicaid Trust Fund for the Elderly.
The governor’s office was not spared, of course. Biting the bullet along with everyone else, Jindal’s plan included a reduction of $10,000 in travel expenses for his office.
That’s correct. Health care is taking a $13 million hit while Jindal is sacrificing roughly the cost of one trip to appear on Fox News or to Washington D.C. for something like his recent attack on Common Core at an event sponsored by someone like oh, say the American Principles Project.
He is pulling $9 million from the Medicaid Trust Fund for the Elderly but don’t worry, he will forego a trip to Iowa or New Hampshire. Yeah, yeah, we know trips to Iowa and New Hampshire are paid out of his campaign fund. But when he takes those political trips, he takes along a detail of state police security personnel whose transportation, lodging, meals and overtime must be borne by the state treasury. It doesn’t take long for just one of those trips to eat through $10,000.
If Jindal is not acutely aware by now that any chance he had to be president has vanished into that $1.6 billion deficit projected for the coming year—a far cry from the $900 million surplus he inherited when he took office seven years ago.
If he does not know by now that his political credentials are shot, he can compare today’s 6.7 percent unemployment rate to the 3.8 percent unemployment when he took office in 2008. That wasn’t supposed to happen after industrial tax incentives increased from a couple hundred million a year to more than $1 billion a year over that same period.
If he is still wondering why his approval rating is lower than President Obama’s, he may want to direct his inquiry to the presidents of Louisiana’s colleges and universities who have seen their budgets cut by $673 million since taking office—and who are now anticipating another $300 million in cuts.
If he still doesn’t get it, he could ask the 250,000 low-income uninsured adults how they could possibly be upset at his decision not to expand Medicaid to cover their health care—all because of his philosophical criticism of the Affordable Care Act (ACA), aka Obamacare. And while he’s at it, he might wish to ask Baton Rouge’s low-income uninsured residents in the northern part of East Baton Rouge Parish how they’re going to make out after he closed Earl K. Long Hospital last year which forced those residents to seek emergency care at Baton Rouge General Medical Center-Mid City which announced this past week that it is closing its emergency room because of the financial losses incurred from that overflow from Earl K. Long.
Michael Hiltzik, writing for the Los Angeles Times on Friday (Feb. 6), to say, “Jindal has promoted his plan with a string of distortions about the ACA and the health insurance marketplace that suggest, at best, that he has no idea what he’s talking about.” http://www.latimes.com/business/hiltzik/la-fi-mh-the-lesson-of-louisiana-20150206-column.html
And if Jindal is still a bit hazy about why his chances of becoming president could make a possum optimistic about making it across a busy interstate highway, he might wish to review his glowing optimism over the privatization of the Office of Group Benefits (OGB) that preceded a drawdown of the agency’s reserve fund from a healthy $500 million built up by former OGB CEO Tommy Teague, whom Jindal fired, to less than half that amount.
After he’s done all that, then maybe he’ll finally understand why Louisiana’s middle income growth was sixth worst in the nation (-4.9 percent, as in a negative growth) in 2013. Maybe, just maybe, it will finally dawn on him that the widening income gap is not good news for the state’s poorest citizens. Perhaps someone will explain to him that the state’s poorest 20 percent of households averaged earning $8,851 in 2013 (that’s household income, not per capita). There may even be a chance that he can explain why the income share of 2.8 percent among the state’s 20 percent poorest was down from 3.2 percent share in 2009 while the wealthiest 20 percent held nearly 52 percent of the state’s income—a figure even higher than the national figure and a dramatic increase from 2009—even as the state’s poverty rate increased.
We’ve been beating this drum steadily for nearly five years now and just when we were beginning to believe no one was listening, no less than three national news organizations (the New York Times, the Los Angeles Times, and Politico) have jumped into the fray with witheringly harsh stories critical of Jindal and his train wreck of an administration in Louisiana.
And to think, it took an incredibly silly diatribe about Islam in London and a prayer meeting in Baton Rouge sponsored by a fundamentalist fringe element to get the attention of the national media that decided, at long last, it might be time to peel back the layers of righteousness and morality and take a long, hard look at the real Jindal and his actual record.
Funny, isn’t it, how often the big picture is overlooked until someone stumbles onto some little something that sets much bigger events into motion?
And now, at long last, we feel we can safely say it’s over. Done. Kaput. We have witnessed, in the incredibly short span of only a couple of weeks, the complete cratering of a political quest.
Cue Roy Orbison. https://www.youtube.com/watch?v=ufgrNRPFJn8&list=RDufgrNRPFJn8#t=0
Posted in Contract, Contracts, DOA, Governor's Office, House, Legislators, Legislature, Retirement, Senate, State Agencies, State Police on February 6, 2015| 11 Comments »
Friday traditionally is a slow news day around the State Capitol and observers know that most controversial announcements or bad news releases by the administration of Gov. Bobby Jindal will be issued late on Fridays in the hope that most reporters have gone home for the day.
The timing of the mundane and not-so-good news releases also is such that people just don’t follow events as closely over the weekend.
Accordingly, LouisianaVoice has pulled together some of the stories that are not likely to make the local six o’clock news or cause much stir in the state’s daily newspapers. But they are, nevertheless, stories that we feel deserve at least some attention, so here we go:
Mike Edmonson Retirement Redux
Regular readers will remember our story of last July 11 which launched the major controversy coming out of last year’s legislative session. That was the story about Senate Bill 294 (SB 294) by State Sen. Neil Riser that was signed into law by Gov. Bobby Jindal as Act 859 which gave State Police Superintendent Mike Edmondson that otherwise illegal hefty retirement boost of about $55,000.
The LouisianaVoice story created quite an uproar and culminated with a judicial ruling on a lawsuit by State Sen. Dan Claitor (R-Baton Rouge) that the requirement increase was unconstitutional, which seemed at the time to end the matter.
But not so fast. Claitor, not altogether trusting the system to prevail, has pre-filed a bill which he hopes will tie up any remaining loose ends.
Senate Bill 2 (SB 2) by Sens. Claitor and Barrow Peacock (R-Bossier City) have pre-filed the bill which “repeals provisions for payment to certain DROP (Deferred Retirement Option Plan) participants of a retirement benefit calculated as if the person had not participated in DROP.”
The very title of the bill puts Edmonson—along with one other state trooper who by sheer coincidence qualified for the increase under the Riser bill amendment that was snuck through an unsuspecting legislature on the last day of the 2014 session—squarely in the crosshairs of the Claitor-Peacock bill.
The Riser amendment created one of the uglier moments of the entire legislative session as slowly details leaked out of how Riser, acting on the directions of Gov. Bobby Jindal, attached the amendment to the bill that ostensibly dealt with police disciplinary procedures and once passed, was quickly signed into law by Jindal.
Had the amendment gone undetected, it would have bumped Edmonson’s retirement from $79,000 per year to $134,000 yearly.
Here is the link to the Claitor-Peacock bill by title, followed by a link to the actual bill:
https://www.legis.la.gov/legis/BillInfo.aspx?i=226443
Exceptional Jindal profile by Tyler Bridges
And speaking of Jindal, it appears that the national media are beginning to catch on to the Jindal Traveling Road Show, prompted it seems, by his hysterical claim of Islamic enclaves of “no-go” zones in Europe, followed in quick fashion by a silly response to the mention by blogger Lamar White that the governor’s official portrait in his fourth floor office gives the appearance of something like 50 shades of white. It turns out that portrait is a loaner and not the “official” portrait. The “official” portrait gives of a decidedly pinkish hue, making it appear that the white one got a bit too much sun.
Be that as it may, Tyler Bridges, a New Orleans writer, has penned an excellent piece on Jindal’s failed fiscal policies (much more important in the long run than his skin tones) for Politico, a Washington, D.C. news service widely read by political junkies—especially in Iowa, New Hampshire and South Carolina, where Jindal hopes (almost to the point of desperation, it seems) to make early headway in his clumsy efforts to grab the GOP presidential nomination. Here is the link to that superb piece by Bridges:
LR3 Contract with Economic Development
Last February we dissected the events surrounding the awarding of a $717,000 no-bid contract awarded to LR3 Consulting LLC of Baton Rouge by the Louisiana Office of Economic Development (LED).
That contract, which runs through Sept. 30 of this year, calls for the “development, establishment and/or delivery of a database of potential trainees for continued pre-hire training using a customized assessment instrument to determine skills proficiencies based on individual company requirements.”
We are not altogether sure why a $717,000 contract needed to be awarded to a firm to perform the same duties already being done by the Louisiana Workforce Commission but hey, who are we to question good government?
The contract was broken down into three yearly amounts—$169,999 for the first year (Oct. 12, 2012 through Sept. 30, 2013) and $249,999 for each of the ensuing two years. This was done, according to an LED spokesman, so as to avoid the necessity of issuing a request for proposals (RFP) and thus avoid “competitive bidding or competitive negotiation.”
The issuing of service contracts is permissible so long as the “total contract amount is less than $250,000 per twelve-month period,” according to Title 39, Section 1494.1 of the Louisiana Revised Statutes which then goes on to say, “Service requirements shall not be artificially divided so as to exempt contracts from the request for proposal process.” Hmmm. Seems to us a real proponent of good government would want competitive bidding.
Nevertheless, it has come to our attention that LR3 may well not be a viable entity and thus, ineligible to contract with the state.
A check of the Secretary of State’s corporate web page reveals that LR3 Consulting LLC is “not in good standing for failure to file (an) annual report.”
With nearly eight months left on the LR3 contract, the loss of standing with the Secretary of State should be a concern to Lionel Rainey, III, the agent and sole officer of LR3:
The term “not in good standing” means that a limited liability company is delinquent in filing the annual report required by R.S. 12:1308.1.
The statute goes on to say that each limited liability company which is not in good standing “shall be prohibited from engaging in commercial business operations with the state or its boards, agencies, departments, or commissions. Any contract between the state or its boards, agencies, departments, or commissions and a limited liability company which is not in good standing may be declared null and void by the board, agency, department, commission, or the division of administration.”
Here is the link to the Secretary of State’s corporate records page which shows that LR3 is not in good standing:
https://coraweb.sos.la.gov/CommercialSearch/CommercialSearchDetails.aspx?CharterID=1001456_F5D52
Our favorite news blog, too?
And speaking of corporate records, one of our favorite political web blogs also turns up as “inactive,” according to the Secretary of State.
We particularly enjoy The Hayride, a Jindal support group blog run by Scott McKay for the off the wall advertisements that are featured daily on his blog. Recently, we’ve seen ads for products that feature a cure baldness almost immediately, a cure for cancer through a Biblical verse, a cure for Alzheimer’s, and even tips on how to invest in gold “form the former director of the U.S. mint,” for a military grade “steroid alternative,” and of course, secret weight loss measures.
But alas, the Secretary of State now tells us that Hayride Media, LLC is no longer active as a corporate entity.
That won’t change the flow of wonderful material coming from the blog, but it does remove any legal protection from litigation that might be lurking in the bushes, ready to pounce on any actual error by The Hayride. We’re just sayin’…
Here is The Hayride’s corporate record entry on the Secretary of State’s web page:
https://coraweb.sos.la.gov/CommercialSearch/CommercialSearchDetails.aspx?CharterID=878951_J6D52
Posted in Contract, Contracts, Economy, Exemptions, Finances, Fraud, Governor's Office, Grant, Grants, House, Incentives, Legislators, Legislature, Senate on February 5, 2015| 5 Comments »
What should Louisiana citizens know about a $12 million real estate deal in Iberville Parish between the Louisiana Department of Economic Development (LED) and a Russian Oligarch involving a proposed fertilizer plant on property surrounding a Louisiana National Guard facility?
Apparently nothing, if one judges from the status updates coming from the Jindal administration since the deal was made back in June of 2013.
Throw in a curious buy-back clause contained in the agreement between the state and EuroChem Louisiana LLC, an option for EuroChem to purchase a second tract in St. John the Baptist Parish, and talk about environmental emission credits that were supposedly promised to Eurochem but then appear to have evaporated into…well, thin air, and you have the makings of political intrigue with an international flavor.
Readers may remember our post last October 20 in which we revealed what appeared to be a sweetheart deal between the state and Vantage Health Plan whereby Vantage was allowed to purchase the former Virginia Hotel in Monroe for $881,000 without having to bother with a pesky public auction and sealed bids.
That transaction was made possible (even though there was another party interested in purchasing the building that had been serving as the State Office Building in Monroe) by Senate Bill 216 (SB 216) by Sens. Mike Walsworth (R-West Monroe), Rick Gallot (D-Ruston), Neil Riser (R-Columbia), and Francis Thompson (D-Delhi).
Well, it turns out there was considerably more to SB 216 (which became Act 127 upon the signature of Gov. Bobby Jindal). We saw the bill in its entirety at the time we wrote our story last October but did not understand the significance of a part of the bill entitled Section 3.
Until now.
Section 3 called for the sale of 2,150 acres of land within the town of St. Gabriel in Iberville Parish to a then unidentified “business entity that enters into a cooperative agreement” with the Department of Economic Development.
Not only was the prospective buyer not named in the bill (contrary to the other part of the bill that clearly identified Vantage Health and the purchase price of the Virginia Hotel), but the bill also contained no mention of a purchase price for the Iberville property. Neither the name EuroChem nor a purchase price is contained anywhere in the bill.
It is understandable that the buyer’s name might be left out of the bill, especially if the sale is still pending and nothing has been finalized. But when considering a proposal to dispose of a 2,150-acre tract of property for industrial purposes, one might be reasonably expected to ask how much money is involved before casting a vote on such a measure.
The bill passed the House by a 96-1 vote and by a 31-1 vote in the Senate. Voting against the bill in the House was Rep. Marcus Hunter (D-Monroe) while the lone dissenting vote in the Senate was cast by Sen. Dan Claitor (R-Baton Rouge). Seven senators and eight House members were absent or did not vote.
The Senate vote was on April 24, 2013, and the House approval followed on May 22. Gov. Bobby Jindal signed the bill on June 5 and the cooperative endeavor agreement was signed on June 14 by LED Deputy Secretary Steven Grissom—even though the bill did not become law until Aug. 1, 2013. 
(CLICK ON IMAGE TO ENLARGE)
The name of the Eurochem representative on the state documents obtained from LED was Ivan Vassilev Boasher, identified only as “Manager.”
(CLICK ON IMAGE TO ENLARGE)
EuroChem, founded in 2001, is a Russian company owned jointly by Melnichenko (92.2 percent of shares) and CEO Dmitry Strezhnev, who owns the remaining 7.8 percent. It was Strezhnev, and not Melnichenko, who joined with Jindal in announcing plans for the $1.5 billion facility.
To secure the project, the state offered the company a competitive incentives package that includes a $6 million performance-based grant to offset the costs of site infrastructure improvements, the announcement said. In addition, EuroChem will receive the services of LED FastStart—the state’s workforce training program. “The company also is expected to utilize Louisiana’s Quality Jobs and Industrial Tax Exemption programs,” Jindal said in making the announcement on July 10, 2013.
“EuroChem is evaluating two final sites for its Louisiana plant,” he said. The Iberville Parish property had been on the market for more than two years through the Office of State Lands, and EuroChem deposited $12 million in an escrow account to buy the property. At the same time, EuroChem also secured an option to purchase a 900-acre, privately-owned tract in St. John the Baptist Parish. “Both Mississippi River sites are being evaluated for construction and logistics suitability, and the company will make a final site decision within the next year,” Jindal said. http://gov.louisiana.gov/index.cfm?md=newsroom&tmp=detail&articleID=4141&printer=1
Well, a year has come and gone and the option on the St. John property, identified by sources as the Goldmine Plantation in the Mississippi River’s east bank near the town of Edgard, which was for 330 days, has expired and was not renewed. No documents requesting permits have been filed with the parishes of St. John or Iberville, the town of St. Gabriel or the U.S. Army Corps of Engineers.
Meanwhile, during the 2014 legislative session—a year after approval of the sale of the Iberville Parish land to an unknown buyer for an undisclosed price—State Rep. John Bel Edwards apparently decided the deal was not a good one in light of the Ukraine crisis which erupted after approval of the cooperative endeavor agreement.
Edwards pushed through House Concurrent Resolution 209 (HCR 209) which requested that LED Secretary Stephen Moret “reevaluate and explore rescinding the cooperative endeavor agreement with the Russian-based company EuroChem.”
Of course the administration promptly ignored the resolution.
The 2,150 acre parcel in Iberville Parish is surrounded on three sides by the Mississippi River and the tract in turn surrounds the Carville Historic District that houses the National Hansen’s Disease Museum, the Gillis W. Long Military Center (Louisiana National Guard facility), and the U.S. Department of Labor’s Carville Job Corps Center. There are no exiting shipping terminals on the tract and the property is prone to flooding during times of high water.
One Iberville Parish official told our sources that he did not believe the project was going to move forward because of relations between the U.S. and Russia over the Ukraine crisis and because of current restrictions in Iberville on air emissions from existing plants which limits the amount of air emission credits available.
And it is those air emission, or carbon, credits that appear to be the key in the entire deal.
One person close to the St. John transaction, told our source that while the prospect of Eurochem’s building a plant in Louisiana is “still alive,” the purchase of the Iberville property “had to do with environmental credits.”
The credits, he said, were available from another company at the time they purchased the Iberville tract but are now gone. He refused to identify the company from whom credits were supposed to be available nor did he say what happened to those credits. “One was the deal (for construction) and one was about emission credits,” he said. “They purchased the Iberville land and continued to do business with us like it never happened.”
A spokesman for the Department of Environmental Quality explained that there are basically two geographic categories when considering air quality standards for permitting: attainment or nonattainment. When an area is considered to be in the nonattainment area, DEQ works with businesses to lower emissions to meet standards through “emissions credits.”
These “credits,” which are provided by the state, are gained by companies that make improvements to their current physical plants in order to reduce oxide and volatile organic compound (VOC) emissions. The credits can be bought and sold much like a commodity on the open market, he explained.
The credits also have to be acquired from companies within that particular designated geographic area that is considered in the nonattainment area.
Because Iberville Parish is within a nonattainment area, Eurochem would have to acquire the credits if planning to make an application for construction and would be required to demonstrate it had sufficient oxide and VOC credits to meet the application approval.
While no one is making any accusations, there is a flourishing international black market for emissions credits that has come under scrutiny by several investigative agencies, including Interpol, which calls carbon trading the “world’s fasting growing commodities market.” Guide to Carbon Trading Crime
http://www.interpol.int/en/News-and-media/News/2013/PR090/
Larry Lohmann, writing for New Scientist, says that the larger carbon markets are “poised on the edge of breakdown.” https://www.academia.edu/3152549/Regulation_as_Corruption_in_the_Carbon_Offset_Markets
Deloitte Forensic, Australia, calls carbon credit fraud “the white collar crime of the future.”
Carbon credits also have become a favorite vehicle for money laundering schemes, according to investigative agencies. http://www.redd-monitor.org/2013/08/06/itv-series-fraud-squad-investigates-carbon-credit-criminals/
http://www.marymonson.co.uk/fraud-solicitors/carbon-credit-fraud/
There are too many unknowns about the Iberville Parish land sale, according to retired Gen. Russel Honoré, leader of the Louisiana Green Army coalition. “The state is broke and we’re making deals with foreign entities who are polluters in their own countries,” he said of the Iberville Parish land sale as well as a recent deal with a Chinese company that has had a poor environmental record.
“As much pollution problems and erosion problems as we have in this state, we don’t need to be bringing in these companies from other countries unless they have clean safety and environmental records,” Honoré said.
Still another unanswered question concerns that buy-back clause in the cooperative endeavor agreement between Eurochem and LED. The side of the ledger favoring EuroChem is the $6 million grant the state gave EuroChem, along with all the other tax incentives it is receiving—should the plant be built. But on the plus side for Louisiana is the clause that says if the fertilizer plant is not built, the state has the option of buying the land back at a reduced price or approving the buyer for re-sale.
$2.50 each or three for $6.00
Louisiana Voice 