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Only in Louisiana.

A lawsuit filed in 23rd Judicial District Court in Ascension Parish challenging the legality of the proposed approval of $450 million in industrial tax exemptions raises two immediate questions:

  • What are Projects Magnolia, Zinnia, Bagel and Sunflower/Sunflower Seed?
  • Why is the Ascension Parish Council being so secretive about the true identities?
  • Why did the Ascension Parish Council’s Finance Committee not follow the law in considering the proposed tax exemptions?
  • Most important of all, what is the Ascension Parish Council trying to hide?

These are all questions to which plaintiffs Dr. Henrynne Louden, George Armstrong and Lana Williams are seeking answers in their petition filed last Friday.

On Sept. 12, the council’s Finance Committee, which in truth is comprised of all 11 council members, met and added to its agenda for the full council meeting of Sept. 21 Item 7, calling for the consideration of “resolutions to award industrial tax exemption at levels recommended by the Ascension Economic Development board for the following projects:

  • Project Magnolia;
  • Project Zinnia;
  • Project Bagel;
  • Project Sunflower/Sunflower Seed.

Altogether, the four projects would cost Ascension Parish $55.6 million—for a grand total of 32 new jobs, or $1.7 million per job.

To see the lawsuit in its entirety, click HERE.

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“The identity of the projects on the agenda for the meeting of the council held on September 21, 2017, are fictitious,” the lawsuit says, adding that neither the plaintiffs “nor any other member of the public could determine, from a review of the consent agenda:

  • The identity of the company (or companies) seeking the benefit of an industrial tax exemption;
  • The amount of the exemption sought for each project;
  • The cost of granting each of the exemptions;
  • Whether any of the projects comply with requirements of the Louisiana State Constitution, or
  • Whether any of the projects comply with requirements of Executive Order Number JBE 2016-73.

“There are two things at issue in this suit,” said a spokesperson for an organization calling itself Together Louisiana: “Whether public subsidies can be approved by a public body without disclosing the identity of the entity receiving the subsidies, and whether reasonably specific public notices must be provided regarding approval of such subsidies.”

Article 7, Section 21(F) of the Louisiana State Constitution of 1974 spells out the requirements for approval of the ad valorem tax exemptions for new manufacturing facilities.

“After being elected,” the lawsuit says, Gov. John Bel Edwards determined that the Board of Commerce and Industry “…had approved industrial tax exemptions contracts ultimately resulting in an average of $1.4 billion in foregone ad valorem tax revenue each year for the next five years for parishes, municipalities, school districts and other political subdivisions of the state that directly provide law enforcement, water and sewage, infrastructure, and educational opportunities to Louisiana citizens.”

On Oct. 21, 2016, Gov. Edwards issued Executive Order Number JBE 2016-73 entitled “Amended and Restated Conditions for Participation in the Industrial Tax Exemption.”

The executive order requires that the governor and Board of Commerce and Industry be provided with a resolution adopted by, among others, “the relevant governing parish council, signifying, “whether it is in favor of the project,” the lawsuit says.

The executive order further says that contracts for industrial tax exemptions which do not include a resolution by the relevant local governing authority “will not be approved by the governor.”

The agenda for the Sept. 12 Finance Committee meeting, the plaintiffs say in their petition, “failed to indicate that (it) would be considering whether or not to approve a resolution signifying that the council was in favor of one or more industrial tax exemption.” Despite failing to include the item on its agenda, the Finance Committee did, in fact, recommend approval by the council of such a resolution, placing the committee, the lawsuit says, in violation of the state’s open meeting laws.

“Not only are meetings of the public bodies to be open,” the lawsuit says, (but) “citizens have the right to know—in advance—the subject matter upon which governing bodies will deliberate and vote.”

The state’s open meeting laws require posting written notices of the agenda of all meetings “no later than 24 hours, exclusive of Saturdays, Sundays, and legal holidays, before the meeting” and “shall include the agenda, date, time, and place of the meeting.”

The committee’s violation of the open meeting laws, the plaintiff say, deprived the public of the right to:

  • Know what was being considered by the Finance Committee;
  • Directly participate in the deliberations of the Finance Committee;
  • Protect themselves from secret decisions made without any opportunity for public input.

The lawsuit is asking the court to declare actions of both the Finance Committee and the full council void as provided by law.

The plaintiffs and their attorneys, Brian Blackwell and Charles Patin of Baton Rouge are, in all probability, correct in their interpretation of the state’s open meeting laws (Article XIL, Section 3 of the 1974 Louisiana State Constitution and Louisiana Revised Statute 42:19).

But this is Louisiana and it has been the experience of LouisianaVoice and other members of the media that the law is whatever some judge says it is. Judges apparently have wide discretion in concocting their own interpretations of the law to accommodate whomever the judges wish to accommodate—usually campaign donors.

The three plaintiffs in this case have the full moral support of LouisianaVoice but the reality is there is usually negligible correlation between law and justice once you walk through those courtroom doors.

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Earl Long, Jimmie Davis, John McKeithen, Edwin Edwards, Dave Treen, Bubby Roemer, Mike Foster, Kathleen Blanco, Bobby Jindal, John Bel Edwards.

Each of these governors has left his or her mark on Louisiana. Some have been good, some bad, and some, for lack of a better term, indifferent.

Earl Long, for example, gave Louisiana school children hot lunches. His brother Huey gave them free text books.

Davis gave the state a civil service system that, while not perfect, was designed to protect workers from a political spoils system.

But what none has been able to do is to lift the state out of the quagmire that defines Louisiana as one of the worst places to live in terms of quality of life, income, job growth, education, and overall health.

It’ll be left up to the historians to determine if that is the fault of the governor, the legislature, or the general political climate that has been allowed to permeate the system, leaving the state’s citizens with a mass feeling of resignation to the prospect that that’s just the way it is.

If it’s the latter, then we have allowed our state to move into a downward spiral from which becomes increasingly difficult to recover. Only those with the power and resources which, when combined, produce political influence, may prosper in such a climate.

When we become so complacent and inured to low expectations and even lower achievements, only those who are unscrupulous, devious, and manipulative will see a path to riches—to the detriment of those of us who allow it to happen.

But it doesn’t have to be this way. We don’t have to be satisfied with the status quo where we keep electing the same political opportunists who belly up to the trough to get first shot at the goodies, leaving the scraps for the rest of us.

Those people never seem to go away and whose fault is that?

I’m beginning to have serious doubts, for example, about the state’s Restore Louisiana program created to help victims of the 2016 floods. How many homeowners have actually been helped so far as opposed to those who find endless obstacles created by bureaucratic red tape—all while employees of the program continue to collect paychecks? How much of that recovery money is being eaten away by salaries of those who are supposed to be helping flood victims?

The governor says the hurricanes that struck Texas and Puerto Rico may slow the recovery process in Louisiana.

Why is that? Hasn’t the money already been appropriated for Louisiana? Why should the recovery process be slowed by those events if the money is already in place to help?

Perhaps it’s all just a part of the overall attitude of our politics as usual which has the state ranked as the third worst state in which to live, according to 24/7 Wall Street, the service which produces some 30 news releases per day on such things as state rankings, college rankings, the economy, and other issues.

LSU football has dropped out of the top 25 rankings. Louisiana has never been in it—except perhaps in the rankings of corruption, graft and ineptitude.

It’s latest ranking, released today, shows that Louisiana 10-year population growth of 6.4 percent is the 13th lowest. Could that be because our unemployment rate of 6.3 percent, according to the service, is third highest in the nation, or that our poverty rate of 19.6 percent (that’s about one of every five people in the state) is also third highest, or that our life expectancy at birth of 75.4 years is the fourth lowest?

What have our leaders done to address these issues?

  • They have fought increasing the minimum wage;
  • They have rejected efforts to ensure that women are paid the same as men for performing the same work;
  • They have robbed our colleges and universities of funding, forcing them to raise tuition which, in turn, is putting a college education out of reach for many;
  • They have decimated our medical teaching universities by giving away our state hospitals;

They have consistently looked the other way as the bad news mounts up but have proved themselves to be most diligent in:

  • Protecting the right to bear semi-automatic weapons;
  • Giving away the state treasury to business and industry in the form of general tax breaks that have to be made up by the rest of us;
  • Enacting tougher and tougher penalties for minor crimes that have produced a state with the highest incarceration rate in the civilized world;
  • Allowing our infrastructure (including more than a billion dollars in maintenance backlogs at our colleges and universities) to crumble beneath us with no solution in sight because of a lack of funding;
  • Protecting young girls by dictating a minimum age for exotic dancers while allowing the state to become a feeding ground for predators calling themselves adoption agencies that in reality, are little more than baby brokers;
  • Enacting legislation for faith-based charter schools and then raising holy hell when one of those applicants turns out to be an Islamic school.

Sure, we can stick out our chests and proclaim that at least we aren’t Mississippi which has the fifth-highest unemployment rate at 5.9 percent, the highest poverty rate (22.0 percent), and the lowest life expectancy at birth (74.5 years).

But in the final analysis, that’s really grabbing at straws.

Arkansas and Alabama rank ahead of Louisiana (fourth and fifth worst states in which to live, respectively).

Arkansas’s poverty rate is fourth-highest at 19.1 percent and its life expectancy at birth is seventh-lowest at 75.8 years.

Alabama has an unemployment rate of 5.7 percent (seventh-highest), a poverty rate of 18.5 percent (fifth-highest), and the second-lowest life expectancy at birth (75.2 percent).

Well, who, you might ask, is lodged between Louisiana and Mississippi for second-worst state in which to live?

That would be West Virginia, with the fourth-highest unemployment rate (6.0 percent), the seventh-highest poverty rate (17.9 percent), and the third-lowest life expectancy at birth (75.4 years).

Do you find it interesting that these same five states are always clustered at the bottom of all the rankings?

Know what else is interesting?

They’re all red states.

Isn’t it time we changed the mentality in Louisiana?

Isn’t it long past the time when we should be breaking out of the pack?

Shouldn’t we be asking really hard questions of our elected officials—from governor all the way down to the courthouse?

And the really soul-searching question:

Shouldn’t we turn off Dancing with the Stars and football and become involved in the recovery of a rotting state?

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If you really want to know what’s wrong with our political system and the people we elect to office, it can be summed up in the current race for State Treasurer.

Here are the Duties of that office:

According to Article IV, Section 9 of the Louisiana Constitution, the treasurer is head of the Department of the Treasury and “shall be responsible for the custody, investment and disbursement of the public funds of the state.” The Treasury Department website outlines the treasurer’s duties:

  • receive and safely keep all the monies of this state, not expressly required by law to be received and kept by some other person;
  • disburse the public money upon warrants drawn upon him according to law, and not otherwise;
  • keep a true, just, and comprehensive account of all public money received and disbursed, in books to be kept for that purpose, in which he shall state from whom monies have been received, and on what account; and to whom and on what account disbursed;
  • keep a true and just account of each head of appropriations made by law, and the disbursements under them;
  • give information in writing to either house of the Legislature when required, upon any subject connected with the Treasury, or touching any duty of his office;
  • perform all other duties required of him by law.
  • advise the State Bond Commission, the Governor, the Legislature and other public officials with respect to the issuance of bonds and all other related matters;
  • organize and administer, within the office of the State Treasurer a state debt management section

https://www.treasury.state.la.us/Home%20Pages/TreasurerDuties.aspx

Nowhere in al that does it even once say or even imply that the job has once scintilla to do with:

  • standing with President Trump to create new jobs or to cut wasteful spending, as former Commissioner of Administration Angele Davis would have us believe in her TV ads;
  • fighting to make drainage and infrastructure top priorities in the state budget, as State Sen. Neil Riser insists in his TV ads;
  • having the guts to say “No! No to bigger government, no to wasteful spending and to raising your taxes,” as former State Rep. John Schroder proclaims in his TV ads, or
  • stopping cuts to education, healthcare and wasteful government spending, as the TV ads of Derrick Edwards insist.

http://www.wafb.com/story/36425632/la-treasurer-candidates-launch-tv-ads-analyst-calls-them-flimsy-on-duties-of-office

So, why do they insist on campaigning on issues in no way related to the actual duties of the position they are seeking?

For the same reason candidates for Baton Rouge mayor (former Mayor Kip Holden and State Sen. Bodie White, who ran unsuccessfully for the job, come to mind) consistently campaign every four years on improving schools and reducing the number of school dropouts when the mayor’s office has zilch to do with the school board:

They consider the average voter to be unsophisticated, ignorant fools who don’t know any better. Or they’re so stupid they don’t know any better themselves. Those are only two choices.

Period.

Their campaign ads clearly illustrate the complete and total disdain the treasury candidates have for Louisiana voters. They obviously think they can throw up (ahem) fake news and pseudo issues that leave voters in complete darkness about each candidate’s relative qualifications to hold the job.

And by so doing, they send a loud message that neither is qualified for—or deserving of—the job.

When John Kennedy, who had previously served as Secretary of Revenue, an appointive position, ran for treasurer in 1995, he ran a somewhat relevant ad that said, “When I was Secretary of the Department of Revenue, I reduced paperwork for small businesses by 150 percent.”

That ad carried a message that actually resonated with small business owners drowning in paperwork and which at least sounded germane to the office of state treasurer—never mind that it was physically impossible to reduce anything by 150 percent. Once you reduce something by 100 percent, you’re at zero.

All of this rant about the four candidates for treasurer and the lame campaign rhetoric of candidates for Baton Rouge mayor—and just about any other political office you can name—just illustrates to what lengths politicians will go to cloud the real issues and to shy away from discussing matters they can actually address when in office.

How many times have you heard a candidate for U.S. Representative or U.S. Senate implore you to send him to Washington so that he can “make a difference”?

It’s disingenuous at best, fraud at worst.

So, on Oct. 14, be sure to go to the polls and cast your vote for one of the four frauds running for treasurer.

It’s the Louisiana way.

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There was a popular game about 40 years ago called “Whack-a-mole.” (For all I know, it may well still be around.) Anyway, the object of the game was for a player to “whack” a rodent with a rubber mallet each time it appeared out of one of five holes. The problem was each time a mole was “whacked”, it invariably popped up again from one of the remaining four holes.

So it is with certain news stories that just when you think you’ve written about all there is to say on the subject, up pops another angle to pursue.

This time though, two separate—and seemingly unrelated—stories that have been covered extensively in the past by LouisianaVoice have now converged to warrant a fresh look at old news.

Before I go any further, I should acknowledge the ever-sharp eyes of my bronchitis-infected friend and Ruston High School classmate John Sachs (Class of ’61). It is he, after all, that brought an otherwise routine local news story in the Farmerville Gazette to my attention. (I guess I’m going to have acquiesce and give him that honorary Deputy Ace Reporter badge he’s been clamoring for.)

Eagle-Eye John called me about efforts to hire a private prison management company to take over management of the 380-bed Union Parish Detention Center. You may recall that LouisianaVoice had a couple of stories about the facility last year, on MAY 10 and MAY 31 about a convicted rapist who was allowed out of his cell to rape a female prisoner. Twice.

That incident, deplorable as it certainly was, is not what this is about, however.

The Gazette story recounted the reason for the decision by LaSalle Corrections to decline Union Parish’s offer. Those reasons dealt with the potential shortage of prisoners if Gov. John Bel Edwards is successful in reducing the number of state inmates and the financial impact of such a move.

Another factor, said LaSalle Chief of Operations Johnny Creed, was the size of four other facilities in north Louisiana managed by LaSalle: Richwood Correctional Center (1,129 inmates), Jackson Parish Correctional Center (1,285), LaSalle Correctional Center (785) and Catahoula Correctional Center (835).

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(CLICK ON IMAGE TO ENLARGE)

And then Creed said the thing that caught Sach’s eye, prompting him to call me with his croaking voice and rattling cough: “As small as (Union Parish Detention Center) is, we would need to bring our work release inmate that work for Foster Farms from our Richwood facility.”

Wait. What?

Foster Farms has 100 work release inmates working at its cotton-pickin’ chicken-pluckin’ plant in Farmerville?

Isn’t this the same plant that Bobby Jindal, with the support of State Sen. Mike Walsworth (R-West Monroe), gave $50 million to in order to get Foster Farms to take over the plant from Pilgrim’s Pride back in 2009?

Wasn’t Foster Farms supposed to provide up to 1,100 jobs with that $50 million?

Does Foster Farms get a $2,400 tax credit for each inmate it employs in the work release program?

And aren’t work release programs something of a cash cow for sheriffs and private prisons farming out prisoners to work for just a smidgen more than minimum wage?

Yes,

Uh-huh.

Yep.

Hell, yes.

You mean to tell me Foster Farms gets a $240,000 tax credit (that’s credit, not a deduction, meaning that’s $240,000 income on which Foster Farm pays no taxes) for hiring 100 prisoners at $7.75 per hour (about 60 percent of which goes to the local sheriff), jobs that should be going to local folks?

Very perceptive, Grasshopper.

This, folks, is yet another lingering smell that hits our olfactory like a pair of dirty socks but which we affectionately call the Jindal Legacy.

The work release program is such a golden egg that sheriffs all over the state, reading the tea leaves shaped like dollar signs, rushed to build their own programs, complete with barracks and vans for workers. And to make sure the beds stayed filled, which is the only way they can get the maximum state dollars, the accommodating Louisiana Sheriffs’ Association lobbied (read parties, booze, women and campaign contributions) Louisiana’s law and order legislators to be more law and order-oriented and pass stiffer penalties for even the most insignificant crimes.

To see just how lucrative this could be for a small parish like Union, let’s run the numbers.

State law allows the sheriff or operator of the private prison to take up to 62 percent of a prisoner’s earnings. One hundred prisoners working 40 hours per week for 50 weeks per year at $7.75 per hour. That comes to $1.55 million earned by the prisoner.

The Union Parish Detention Center is unique in that it is the only such facility in the state in which neither the sheriff nor a private company has operational controls. It is operated by committee comprised of a member of the Union Parish Police Jury, the district attorney and parish police chiefs. Lincoln Parish at one time was run in the same manner but it is now run by the sheriff.

If the parish takes “just” 60 percent, that’s $930,000 per year for the sheriff/operator. And that’s over and above the rate the state pays the sheriff/operator to house the prisoners. More than six years ago, LOUISIANA VOICE published a story that examined some of the housing contracts between the state and several Louisiana parishes.

Despite the money generated by the work release program, the Union Parish Detention Center has continued to lose money. That is the reason for the unsuccessful attempt to lure LaSalle into managing the center.

We followed our December 2010 post with a story in AUGUST 2015 that illustrated the abuses that can occur when someone with the right connections can use that advantage to manipulate a system like work release for his own monetary gain.

Jail operators, be they sheriffs or private corporations, love the money the work release program brings in to augment that paid by the state for housing the prisoners.

And businesses like Foster Farms love being able to hire 100 prisoners at near-minimum wage and receive a $240,000 tax credit in the process.

It’s a win-win for everyone but the taxpayers.

So, bottom line: Thar’s gold in them thar jails.

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Bobby Jindal, the Rhode Scholar who rode into town on the crest of a billion-dollar surplus nine years ago this month, rode out 12 months ago leaving the state wallowing in red ink and now it is learned that he inflicted even more fiscal carnage on his way out the door.

And knowing the way in which he and his final Commissioner of Administration, Kristy Nichols, juggled the books, it’s not at all unreasonable to think that Jindal’s final example of fiscal irresponsibility may well have been an intentional act of political chicanery carried out to buy him time so that his successor would be left with the mess to clean up. (Of course, Kristy didn’t become commissioner until Paul Rainwater left in 2012, but that does not change the fact that a lot of dollars were moved around—swept—before and after she was promoted.)

Hey! It’s not that far-fetched. He did it with the Office of Group Benefits. He did it with higher education. He did it with the LSU Hospital System. Boy, did he do it with the hospital system—with a contract containing 50 blank pages, yet!

By the time Jindal left office, virtually the only state agency left with a shred of credibility and integrity was the office of the Legislative Auditor—and that’s largely because the office has complete autonomy and is independent from outside political pressure, particularly from the governor’s office.

And now, coincidentally, it is that same Legislative Auditor who has issued a damning AUDIT REPORT that reveals a major SNAFU (if that’s truly what it was) in which the Jindal administration “misclassified” a $34.6 million default payment made by Northrop Grumman Ship Systems made in 2011.

The payment was made to Louisiana Economic Development after the shipyard failed to meet required hiring quotas but instead of using the money to pay off equipment the state had financed for Northrop Grumman, the audit says the Division of Administration “swept” the money when it was balancing the budget. As a result, the state has already paid some $2 million in interest and administrative costs on the equipment, and is potentially on the hook for some $6.2 million more.

Bobby and Kristy loved the process of “sweeping” agencies of excess funds lying around in order to try and plug gaping holes in the state budget that dogged Jindal every single year he was governor. “Sweeping” for funds is something like picking up crumbs off the floor in an attempt to gather enough to make a bundt cake.

“Since the debt could not be immediately defeased (a provision that voids a bond or loan) because of the limited prepayment options, the funds should have been segregated into a sinking account for defeasement of the debt, not a statutorily dedicated fund account that could be swept by legislative action,” the audit report says.

But the Louisiana Office of Economic Development (LED), then headed by $300,000-a-year Director Stephen Moret, failed to do that and, presto! The funds got swept by the Jindal Housecleaning Service and as a result, the state “will continue to incur additional interest and administrative costs until the debt (on the equipment) is defeased,” the audit reads. “If not defeased before the Oct. 2022 … the state will incur more than $6.2 million in additional interest and administrative costs.”

LED entered into a Cooperative Endeavor Agreement with Northrop Grumman in the early 2000s. The company had acquired Avondale Shipyard in Jefferson Parish and Northrop Grumman, under the terms of the deal, agreed to maintain employment levels of some 3,500 jobs a year with an economic impact of $1 billion. In return, the state agreed, among other things, to issue bonds to finance more than $34 million worth of cranes and equipment that would modernize the shipyard.

But dreams and schemes are made of fragile things. Northrop Grumman fell short of its job requirements and LED notified the company in early 2011 that it wasn’t living up to its employment obligations. Northrop Grumman agreed to settle with the state for $34.6 million, which represented the acquisition cost of the equipment. It wired the money to LED in March 2011, the report says.

But the state didn’t use the money to pay off the debt on the equipment, nor did it set the funds aside in an escrow account to pay it off in the future. Instead, it “swept” the money into the Louisiana Medical Assistance Trust Fund, was enacted during the 2011 session to help supplement the state’s Medicaid program.

But don’t worry, folks. It’s just another example of the superb financial management of the state’s resources about which Jindal would boast—in Iowa, certainly not Louisiana—during his comical quest for the Republican presidential nomination in 2015, his final year I office.

And now the state finds itself hanging out to dry while trying to come up with that long gone $34.6 million, plus about $2 million in interest and administrative costs.

In a written response to the audit’s findings, Commissioner of Administration Jay Dardenne pointed out that Jindal’s actions, while ill-advised, were nonetheless legal. “The (Jindal) administration’s decision to use the funds for other purposes was not prohibited by the terms of the (agreement) with Northrop Grumman,” he says, noting that the Legislature approved of the financial maneuver.

Perhaps, but we all know the definitions of the legal thing and the right thing are sometimes poles apart. In this case, those responsible knew what that $34.6 million was for and they chose to do what was legal but not what was right.

The question now is does the Office of Risk Management carry excess coverage that would allow the State to make a claim for recovery of the money on the basis of stupidity? Should Jindal, Nichols, and Moret be asked to dig deep into their pockets to come up with the money?

Nah. It’ll never happen.

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