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|State Bond Commission Approves $143 Million for Local Projects |
BATON ROUGE, LA - The State Bond Commission approved $143 million for projects statewide and saved taxpayers more than $18 million at its Oct. 16 meeting, according to State Treasurer John Kennedy.
"We approved funding that will repair schools, improve drinking water and enhance health care infrastructure, among other projects," said Treasurer Kennedy. "We also continue to save money on interest."
Among the individual projects approved were:
- West Baton Rouge Parish, $250,000 in Certificates of Indebtedness, Series 2014, not exceeding 6%, not exceeding 10 years for the West Baton Rouge Convention and Visitors Bureau: for financing the cost of signage, lighting, equipment and other capital improvements and renovations to the West Baton Rouge Tourist Information and Conference Center.
- West Carroll Parish, $1,534,000 Letter of Credit, not exceeding 6%, not exceeding 1 year, for the West Carroll Parish Police Jury: for satisfying DEQ's financial assurance requirements for the payment of closure costs for the landfill and incurring debt to the extent funds are drawn from the Letter of Credit.
- Acadia Parish, $7,358,000 in Taxable Limited Tax Revenue Bonds (Qualified Zone Academy Bond), Series 2014, not exceeding 1%, not exceeding 17 years for the Acadia Parish School Board: for rehabilitating, repairing and equipping schools.
- Ascension Parish, $2,500,000 in Taxable Sewer Revenue Bonds, in one or more series, not exceeding 0.95%, not exceeding 22 years, for the city of Donaldsonville: for constructing and acquiring improvements and extensions to the sanitary sewage collection and disposal system, including all necessary land, equipment and furnishings and all engineering, legal and other incidentals costs and fees.
- Ascension Parish, $15,170,000 Taxable Sales Tax Bonds, in one or more series, not exceeding 0.95%, not exceeding 20 years, for the city of Gonzales: for acquisition, construction and improvements, extensions and replacements to the wastewater treatment and disposal system, including acquisition and construction of new collection systems and a treatment plant
- Avoyelles Parish, $2,100,000 in Taxable Water Revenue Bonds, not exceeding 3.45%, not exceeding 22 years for Waterworks District No. 1, for: constructing and acquiring additions, extensions and improvements to the drinking water system, including equipment and fixtures.
- Caddo Parish, $75,000,000 in Water and Sewer Revenue Bonds, in one or more series, not exceeding 6%, not exceeding 25 years, for the city of Shreveport: for acquisition and construction of improvements, extensions and replacements to the combined revenue producing water and sewer utility system.
- Lafayette Parish, $4,200,000 in Sales Tax Bonds, in one or more series, not exceeding 5%, not exceeding 15 years, for the city of Carencro: for capital improvements and funding a reserve fund
- Union Parish, $255,000 in Water Revenue Bonds, in one or more series, not exceeding 3.45%, not exceeding 22 years, for the town of Bernice: for acquiring and constructing additions, extensions, and improvements to the drinking water system, including equipment and fixtures.
- Jefferson Parish, $25,000,000 in Multifamily Housing Revenue Bonds, in one or more series, not exceeding 8%, not exceeding 40 years, for the Louisiana Community Development Authority, Tanglewood Apartments Project: for acquisition, rehabilitation, and equipping of a 384 unit multifamily housing complex located in Westwego.
- Calcasieu Parish, $10,000,000 in Hospital Revenue Bonds, Series 2015, not exceeding 6%, not exceeding 15 years, for the Calcasieu Parish Public Trust Authority, Lake Charles Memorial Hospital Project: for acquisition, construction, renovation and equipping of hospital facilities.
Likewise, the commission approved more than $18 million in savings by refinancing existing debt. The savings were:
- Ascension Parish, $1,600,000 in Revenue Refunding Bonds, in one or more series, not exceeding 5%, mature no later than August 1, 2035, for Fire Protection District No. 1, for refunding Revenue Bonds, Series 2005: saving taxpayers $64,800.
- Caddo Parish, $27,500,000 in General Obligation Refunding Bonds, in one or more series, not exceeding 5%, not exceeding 5 years, refunding all or a portion of General Obligation Refunding Bonds, Series 2005A, for the city of Shreveport: saving taxpayers, $3.6 million.
- Caddo Parish, $76,700,000 in Water and Sewer Revenue Refunding Bonds, in one or more series, not exceeding 5.5%, not exceeding 21 years, refunding all or a portion of Water and Sewer Revenue Bonds, Series 2001A, 2001B, 2001C, 2002A, 2002B, 2003A, 2003B, 2004A, LCDA Revenue Bonds, Series 2007 and LCDA Utility Revenue Bonds, Series 2010C for the city of Shreveport: saving taxpayers $3.8 million.
- Orleans Parish, - $80,000,000 in Special Tax Refunding Bonds, Series 2014, not exceeding 5%, mature no later than July 15, 2025, for the Ernest N. Morial - New Orleans Exhibition Hall Authority for refunding Senior Subordinate Special Tax Refunding Bonds, Series 2004, saving taxpayers $10.6 million.
The Louisiana State Bond Commission meets monthly to review and approve applications from parishes, municipalities, special taxing districts, and other political subdivisions of the State requesting authority to incur debt. For more information, visit www.LATreasury.com.
|Statement from Treasurer John Kennedy on Budget Surplus Debate |
I woke up this morning surprised to find out I am now responsible for sweeping agency funds and crafting the state budget. I am more than happy to take on those responsibilities if the Legislature chooses to task me with them. In the meantime, let me clear up some distortions in statements made this morning by the Division of Administration.
As Treasurer, I am constitutionally responsible for the custody, investment and disbursement of state funds. It is a job that I take very seriously. At least three times a year, the Treasury sends a comprehensive report to the administration about every penny, nickel and dime in the state general fund, and the Treasury is audited every year by the legislative auditor.
As Treasurer, I'm NOT responsible for ensuring that the administration is truthful with legislators and the public about the amount of money that can be appropriated from the state general fund. It is the administration’s responsibility to take our reports and tell legislators and the Revenue Estimating Conference about any and all available money instead of creating a secret slush fund.
It is clear that we spent more money than we brought in last fiscal year. We have a $141 million deficit. It's also clear that the administration wants to use its own secret slush fund to resolve the problem while blaming others for the mess.
I dont blame them. I wouldn't want to be held responsible for the bad budget practices that drove the Office of Group Benefits into financial ruin, drained the Medicaid Trust Fund for the Elderly and crippled our universities. As Treasurer, I'll continue to be a watchdog over the people's money. If the Legislature wants me to take charge of the budget, I will.
|Treasurer Kennedy Offers Financial Solution For Small Business Program|
BATON ROUGE, LA - State Treasurer John Kennedy identified $400,000 Thursday that can be used to assist a financially strapped program that helps businesses find federal dollars.
The Louisiana Procurement Technical Assistance Center is in danger of closing its doors after failing to secure money in the $25 billion state budget. The center needs at least $185,000 to keep operating its counseling centers. Since 1989, LA PTAC has helped Louisiana businesses secure more than $4.5 billion in government contract dollars.
"This is a vital resource for small businesses in Louisiana," Treasurer Kennedy said. "We cannot allow this 25-year-old program to grind to a halt. The money is available to keep it in business."
The state wants Treasurer Kennedy to help dissolve a quasi-public corporation called the Louisiana Office Building Corp. The corporation, which hasn't met in at least a decade, has more than $400,000 sitting in the bank and no debts. The state wants to put the corporation's money into the state general fund.
"I'm in agreement that this money shouldn't just sit in the bank," Treasurer Kennedy said. "The money should be put to good use. I can think of no better use than to save the Louisiana Procurement Technical Assistance Center."
Treasurer Kennedy will ask the Division of Administration this week to earmark the corporation's money for LA PTAC. The small business program assists businesses in 54 Louisiana parishes.
"The PTAC program has operated effectively in Louisiana for many years, leveraging relatively small state investments to attract billions of dollars in federal contracts," said State Rep. Walt Leger III. "This investment supports Louisiana small businesses, creates jobs, and generates revenues so the state can invest in education and health care. It's a no-brainer. I'm grateful that the Treasurer has identified funds to keep this program going and applaud his work to support Louisiana's small businesses."
|Plain Talk On The OGB Health Plan Mess|
Newly discovered information is drawing back the curtain on the real reasons for sweeping health plan changes that will impact 230,000 state workers, teachers and retirees. As someone who is concerned about the state’s deeply flawed budget practices, I’m asking legislators and the legislative auditor to get involved in order to prevent burdening our Louisiana families with what is tantamount to a detrimental tax increase. Get involved now. Get involved before it’s too late.
At issue is the state Office of Group Benefits, which provides health insurance to thousands of current and retired state workers, schoolteachers and their spouses and children. For years, the office operated smoothly, building up $525 million in reserves while offering fair health plans.
Things changed when the state encountered budget problems. Instead of tightening its belt, the state helped itself to the reserves. OGB is not a government giveaway program. State workers’ dollars helped build up the fund balance. The money shouldn’t be stolen from them – and, to be clear, it is being stolen from them.
How the state took the money involves a sleight-of-hand budget trick at which most accountants would shudder. Heck, even Bernie Madoff would shudder. Like other employers, the state pays 75 percent of an employee’s plan premium. In 2013 and 2014, the state intentionally – and recklessly – lowered premiums to decrease the amount of money the state had to put up so it could use the money to balance the state’s budget. Because of the lower premiums, OGB burned through its reserves. Now changes have to be made in order to save a ship that was deliberately steered into an iceberg.
State employees, retirees and schoolteachers will have higher deductibles and fewer benefits. That amounts to a virtual tax increase for Louisiana families.
This wasn’t supposed to happen. In 2011, then-Commissioner of Administration Paul Rainwater assured taxpayers OGB’s surplus would not be “stolen” (his words) or diverted to balance the budget. A few years later, current Commissioner of Administration Kristy Nichols said keeping hundreds of millions locked up in a reserve fund isn’t smart. It’s not smart for whom?
The state initially claimed it dropped premiums on the advice of its actuary. Here’s the problem: There’s always a pesky paper trail. The actuary, Buck Consultants, wrote a report, saying it didn’t recommend either decrease. Buck’s take was that the state deliberately set premium rates “artificially low to draw down the OGB’s reserve fund.”
Now the state is suggesting that the crucial rate recommendations by Buck may be in a bureaucrat’s email inbox somewhere. The state’s “looking” for the elusive emails.
It’s clear that the premium reductions were a political decision made in a political environment to free up money to balance the budget. By spurning its million-dollar actuary’s advice, the Office of the Commission jeopardized the stability of state health plans.
Now the Office of the Commissioner has made another political decision to replenish the fund balance by reducing benefits instead of increasing premiums. Remember increasing premiums would force the employer – in this case, the state – to put up additional dollars. Instead, the state is socking this solely to families.
The arrangement makes one thing abundantly apparent: A single appointed bureaucrat has far too much power over something that impacts a quarter of a million people. We need long term reform. Short term, plan members should be given the option to absorb premium increases instead of just reduced benefits. That’s how we handle the retirement systems for pensions. Is health care any less important?
Look, I’ll put my small government credentials up against anyone’s. This is not about the size of government. This is not an entitlement program. State employees put their trust – and their money – into a system that was supposed to safeguard their health insurance. Their trust was misplaced to solve political budget problems.
It’s clear that legislators need to clean up this mess, and they need to do it immediately. Ask the legislative auditor’s actuary to take a look at OGB’s plans. Ask the Public Employees Retirement Systems’ Actuary Committee to assume control of OGB.
Health coverage is too important. Let’s slow this down and get it right. We owe it to taxpayers. We owe it to the people whose lives are being affected.
|Why I Invest In Israel Bonds|
Last year, I urged Louisiana taxpayers to scour their mutual fund portfolios for high-risk Puerto Rico bonds. I didn't want college educations and retirements relying on Puerto Rico's shaky economy.
You won't find Puerto Rico bonds in the Louisiana Treasury's investment portfolio. What you will find, though, are bonds embraced by Eleanor Roosevelt, Albert Einstein and Harry S. Truman.
The Louisiana Treasury currently holds $18 million in Israel Bonds. Those bonds earn 2.868 % when the 3-year U.S. Treasury is yielding 1.08 %. As State Treasurer, I invest in Israel Bonds for a few simple reasons: They are a safe, solid investment from a country with a sound economic future. Unlike Puerto Rico bonds, you won't find Israel Bonds hovering above a "junk" level credit rating. The credit rating on Israel Bonds is high.
But, first, a little history: Israel Bonds' history involves the genius of Albert Einstein and the glitz of old Hollywood.
Israel became a nation in 1948 after it became a haven for Jews fleeing persecution elsewhere in the world. The new nation quickly set about securing a financial foothold. A conference at Jerusalem's King David Hotel in 1950 launched Israel Bonds.
Political figures and Hollywood elite embraced the bonds as an investment in Israel's security. Roosevelt, Einstein, Truman, Elizabeth Taylor and Cary Grant jumped onboard. Since 1951, more than $36 billion in Israel Bonds has been sold. It's an astonishing success story.
Through the innovation of Israel Bonds, Israel quickly shed its training wheels as a newly formed nation. Today Israel is an economic world leader.
As the Organization for Economic Cooperation and Development wrote in its 2013 economic survey: "Israel's output growth remains relatively strong, unemployment is at historically low levels, its high-tech sector continues to attract international admiration, and new off-shore gas fields have come on stream.
U.S. investment in Israel is strong. Google has had offices in Israel since 2006 and digitalized the Dead Sea Scrolls. Eager to find a seat at the table in Israel's tech sector, Facebook snapped up a company in 2013 that had employees in Israel. Johnson and Johnson partnered with Israel's Office of the Chief Scientist on a biotech incubator. Hewlett Packard has labs atop Mount Carmel.
Economic development flows both ways. The U.S. imports billions of dollars in goods each year from Israel. The import list includes diamonds, pharmaceutical products, machinery and medical instruments.
Like other peace-loving countries, Israel wrestles with the threat of terrorism. This summer was particularly grizzly with the murders of three Israeli teenagers by militants. By no means is the leadership of Israel a threat to peace.
Here's how the U.S. Secretary of State's Office sums up our nation's relationship with Israel: "The United States was the first country to recognize Israel as a state in 1948. Since then, Israel has become, and remains, America's most reliable partner in the Middle East. Israel and the United States are bound closely by historic and cultural ties as well as by mutual interests."
That - along with Israel Bonds' sold track record - is good enough for me.
|Joe's Unclaimed Property Find|
As state treasurer, I end up with countless dollars that flow into my office because businesses cannot locate people. I get stock dividends, uncashed checks, abandoned checking accounts and unredeemed gift certificates.
If you toss a check into a drawer because it's only for a few dollars, the uncashed amount winds up in the state treasury. If you move without leaving a forwarding address, your utility deposit refund winds up in the state treasury. If your grandma forgets about that savings account she opened up for you when you were born, the money winds up in the state treasury.
This brings me to an important point: I either need a bigger safe or people need to claim their money. We go to malls a few times a year and offer to plug people's names into our Unclaimed Property search engine.
We advertise that roughly one in six people has Unclaimed Property. Still, we have a staggering amount of cash that belongs to other people. You hear so much about it that you tune it out - or you think that you keep a tighter hold on your pocketbook than Ebeneezer Scrooge. So let me tell you a true story about "Joe."
Joe is a blue collar worker in Monroe with six kids and a house that is tumbling down around him. He's a hard worker who takes odd jobs when he can get them. Still, he struggles to pay his bills, and there's never enough extra to keep up his home.
Years ago, Joe worked for a well-known national company. He got stock options that ended when his employment did. Joe moved on without cashing out his stock. He didn't leave a forwarding address.
Fast forward a few years. A private company sends Joe a letter offering to help retrieve money from the state treasury for him in exchange for a finder's fee. It turns out that Joe has Unclaimed Property.
Fortunately, Joe had the good sense to hand the letter from the private company to a friend. The friend just happened to know State District Court Judge Scott Leehy. Leehy immediately suspected that the letter referred to Unclaimed Property in the state treasury. He did a little research and found out that Joe has more than $30,000 in dividends, not including half a million dollars in stock.
"He had no clue that he had anything," Leehy said. "This is the nicest man. He's poor, but he has a lot of pride. He's a great family man."
With Leehy's help, Joe filed a claim for the $30,000 in dividends. That claim helped us unearth the half a million in stocks as well.
Joe worked for this money. He earned it. Last week, I signed a check releasing the money to him. I was glad to do it.
You would be surprised by how much in Unclaimed Property ends up in the state treasury. I recently wrote an even bigger check to a man in the Acadiana region. He is a businessman who had $100,000 in unclaimed property.
More than $600 million in Unclaimed Property currently is in the state treasury. The money includes old bank accounts, deposits, inheritances and stock dividends. Searching for the money simply requires logging onto www.LATreasury.com or calling 1-(888)-925-4127.
It's free to search for Unclaimed Property and claim it. Let me repeat that. It's free - completely free - to search for it and claim it. It's your money; it's not our money although a few businesses want to do the work for you and take a cut.
You have better odds of finding money in the state treasury than you do of winning the lottery.
Just ask Joe.