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4/23/2014
Are You One of 3,000 Individuals Owed Class Action Settlement Proceeds from Citizens Insurance?

BATON ROUGE, La. - If you are one of roughly 3,000 individuals who participated in a class action lawsuit against the Louisiana Citizens Property Insurance Corporation (Citizens) and never claimed your settlement proceeds, the money is now Unclaimed Property, according to State Treasurer John Kennedy.

 

"Regardless of the reason why this money was never claimed, it's our job to return it to you," said Treasurer Kennedy. "If you are owed money from this class action settlement, I encourage you to visit our website today to claim it. We will do everything possible to return this money as quickly and painlessly as possible."

 

The Treasury deposited $5.5 million in settlement proceeds on March 31 and loaded the names of participants into its Unclaimed Property database. There are 3,096 individuals who are owed claims in the amounts of $3,324.34 or $1,715.41. 

 

The proceeds come from a class action lawsuit that was filed against Citizens for the slow adjustment of claims after Hurricanes Katrina and Rita.  The state's Unclaimed Property Division received the proceeds for class members who did not collect their payment or who never cashed their checks.

 

"These particular claims are higher than our average Unclaimed Property refund, which is usually around $900," said Treasurer Kennedy. "If you participated in this class action settlement and never received your proceeds, there is no reason to let your money go unclaimed any longer."

 

All searches for unclaimed Citizens class action settlement proceeds should be done using the Treasury's main Unclaimed Property search page on www.LATreasury.com or by calling toll-free 1-888-925-4127 (Monday - Friday 8:00 a.m. to 4:30 p.m.).

4/23/2014
Louisiana House Unanimously Passes Bill to Cut Consulting Contracts

BATON ROUGE, La. - State Treasurer John Kennedy praised members of the Louisiana House of Representatives today for unanimously passing HB 142 by Rep. Jerome "Dee" Richard to cut consulting contracts by 10 percent and dedicate the $528 million saved to higher education.

 

"Louisiana's colleges and universities need money," said Treasurer Kennedy.  "This bill is a way we can help them without raising taxes or tuition."

 

Louisiana has 19,000 consulting contracts spread throughout state government, and approximately 14,000 of these contracts are for $50,000 or more.  In 2012, total state spending on professional, personal and consulting contracts was $5.28 billion.

          

Taxpayers can search through a list of state contracts here. A small sample of the contracts on this site include: 

  • $94,000 for a California consultant to "assist students to learn valuable social skills through organized play on their recess and lunch periods" (Contract #672113)
  • $874,930 for a consultant to "provide ... assistance to disadvantaged business enterprise companies doing business with DOTD" (Contract #658942)
  • $19,500 for DHH to pay a consultant to "coordinate two Golden Glove Boxing tournaments" (Contract #710616)
  • $250,000 in consulting fees for DOE to "provide valid and reliable data to parents to support informed school choice decisions" (Contract #674139) 

"Why would any reasonable public official give precious taxpayer dollars to the Hop 2 It Music Co., the Smile and Happiness Foundation or the Light City Church under any circumstances, but particularly when our colleges and universities and the kids they teach are falling behind the rest of America in a knowledge-based global economy," asked Treasurer Kennedy.

           

HB 142 passed the House today by a vote of 98-0.  In 2012, the bill passed the House by 94-0 and again in 2013 by a vote of 86-0.  The bill now faces an uphill battle in the Senate, where in previous years, it has been defeated in the Senate Finance Committee.

4/17/2014
Louisiana Taxpayers Save $1.7 Million in Bond Refinancing

BATON ROUGE, LA - The State of Louisiana went to market yesterday to refinance more than $121 million in Gasoline and Fuels Tax Bonds, resulting in $1.7 million in annual debt service savings for taxpayers, according to State Treasurer John Kennedy.

 

“The state originally issued these bonds to fund important highway projects in the TIMED program,” said Treasurer Kennedy. “Building new roads and infrastructure is vital to the economic development of our state, but the financial crisis had produced excess costs for the program.  The restructuring we did yesterday eliminates those extra costs.”

 

The bonds had a mandatory tender date of May 1 meaning they had to be paid in full by May 1 or be refinanced.   Annual debt service payments on the new bonds will total $5.3 million compared to original payments of $7 million.  The debt service on the refinanced bonds is less than what the state previously paid and is hedged with two swap agreements.      

 

Raymond James served as Senior Underwriter for the bond deal.  Jefferies & RBC Capital Markets served as Co-Managers; Lamont Financial Service Corporation as Financial Advisor; Foley & Judell, L.L.P. Bond Counsel; and Breazeale, Sachse & Wilson Underwriter’s Counsel.

 Opinion Columns

3/12/2014
Louisiana Needs A Med School In Lafayette

Louisiana needs another medical school.  Lafayette would be an ideal location.

 

Our state has a doctor shortage.  A third of our people live in a federally-designated primary care shortage area.  Over 2 million Louisianians lack the access to specialist physicians enjoyed by people who live in wealthier states.

 

Louisiana's physician shortage is probably going to get worse.  More of our doctors (28%) are 60 or older than are under 40 (19%).  Our three medical schools-LSU New Orleans, LSU Shreveport and Tulane-graduate about 450 doctors a year, but not all of them stay in Louisiana.  (In 2012, 108 out of 171 graduates of LSU Medical School in New Orleans remained in Louisiana; for Tulane's Class of 2012, it was 35 out of 177.)

 

Like the rest of America, our population is aging.  By 2030, 20% of all Louisianians will be 65 or older, and most of them will need a doctor.  The federal Affordable Care Act (Obamacare), which will insure many previously uninsured Americans, will push demand even higher.  No wonder the Association of American Medical Colleges predicts our country will need 63,000 more physicians by 2015 (140,000 by 2025) than we are likely to have to serve America's medical needs.

 

Other states are addressing their physician shortages.  29 new medical schools have opened in the last 20 years, including a major expansion in 2013 of the University of Mississippi College of Medicine.  Louisiana still has time to catch up, but only if we act immediately by establishing a fourth medical school in our state.

 

Our politicians can fight over the turf later, but an appropriate location for that new medical school is Lafayette.  Metropolitan Lafayette is one of the fastest-growing regions of our state, with a thriving, diversified economy, superb quality of life and an accomplished community of health care providers.

 

Lafayette General Medical Center, which is now a teaching hospital after taking over the state's Charity Hospital in Lafayette (the University Medical Center), is the largest full-service, acute care medical center in Acadiana.  Lafayette General could easily and efficiently support the new medical school, perhaps in conjunction with the new Our Lady of Lourdes Regional Medical Center, the Regional Medical Center of Acadiana and Women's and Children Hospital.

 

There will, of course, be hurdles.  For one thing, money is tight.  The new medical school at Quinnipiac University in Connecticut, which opened in 2013, cost $100 million.   I believe Louisiana could do it cheaper.  Louisiana could save money on its new medical school's physical plant needs by using some of the existing infrastructure in our Charity Hospital system.  Besides, once our new medical school is operational, a class of 100 students would generate $8.4 million a year in tuition for all classes in the 4 year program.

 

A second hurdle will be obtaining new medical residencies.  A medical school graduate cannot practice medicine in the U.S. until he has received on-the-job training as a resident under the supervision of a senior, fully licensed physician for 3 to 5 years, depending on the branch of medicine the resident chooses.  There is a looming shortage of medical residencies.  By 2020 the number of U.S. medical school graduates will exceed the number of residencies.

 

The good news is there are solutions.  Bipartisan legislation is pending in Congress to create 15,000 new residencies over the next 5 years.  Obamacare creates 600 new primary care residencies.  Teaching hospitals currently pay for 10,000 residencies a year; Louisiana could ask its new private hospital partners to contribute.  Commercial insurance companies, which will benefit handsomely from Obamacare, can be asked to help.  States can also use Medicaid monies to fund residencies.  It's important to address the need for more medical residencies in Louisiana teaching hospitals, because 60% of physicians end up practicing within 100 miles of where they did their residency.

 

Louisiana needs more doctors, and we're going to have to grow our own.  In 2013, Louisiana's three medical schools had 14,116 applicants for 493 spots.  A new medical school in Lafayette is needed, and makes financial sense.  If you want somebody to take care of you in 20 years, the training must start now.

 

2/17/2014
Both Right and Left Should Fight Food Stamp Fraud

Here are three things on which Louisiana liberals and conservatives should be able to agree.

 

First, Americans are among the most compassionate people in the world.  If you lose your job, you get unemployment benefits.  If you get sick and can't afford a doctor, you receive free care.  If you don't have a place to live, we'll provide one.

 

Second, this generosity is expensive.  It may be free to its recipients, but it's not to the taxpayers who pay for it.  There are 126 social programs for low-income Americans (72 of which provide cash or in-kind benefits), and that's just by the federal government.  State and local governments have hundreds more.  The federal government alone has spent $20.7 trillion in current dollars since 1964 on the war on poverty, and it currently spends $411 billion a year (12% of its budget) on programs for the poor, such as TANF, Section 8 vouchers, public housing, Medicaid, WIC, EITC, LIHEAP and TEFAP.  We do it because Americans care.  It's what separates us from other countries that allow their less fortunate neighbors to suffer or die.

 

Third, because America's social programs are so expensive, and require capital (taxpayer money) that could otherwise be spent on education, infrastructure, defense and research, or not taken from taxpayers in the first place, anyone who willfully lies, cheats or steals to get benefits from a social program for which he does not qualify should be prosecuted to the full extent of the law.  No exceptions.  To do otherwise impugns the integrity of America's social net, undermines the magnanimity that funds it, unfairly taints the people who need the safety net and play by its rules, and causes taxpayers to lose confidence in programs that help the poor.

 

Unfortunately, government frequently breaks this simple rule.  Take food stamps (the Supplemental Nutrition Assistance Program or SNAP), for example.  SNAP provides money, through a debit card, to low-income citizens to buy food.  The U.S. Department of Agriculture administers SNAP, but the benefits are distributed by the states, in Louisiana's case the Department of Children and Family Services (DCFS).  In 2008 there were 650,000 Louisianians on food stamps; today there are 900,000 (out of 4.5 million people).  The program cost $836 million in 2008; today it costs $1.5 billion.

 

In May of 2013, the Louisiana Legislative Auditor audited DCFS's administration of the food stamp program in Louisiana.  Here's what he found:

  • In 2012, DCFS gave $750,000 in food stamps to 322 people who made more than $50,000 a year.
  • In 2011 and 2012, DCFS gave $1.1 million in food stamps to 1761 people who are in jail.
  • In 2011 and 2012, DCFS gave $107,864 in food stamps to 84 convicted and therefore ineligible drug felons.
  • From March 2010 to March 2011, DCFS gave food stamps to 1573 people who were double-dipping by receiving food stamps in Louisiana and another state.
  • In 2012, DCFS gave food stamps to 3060 people who spent most of the money ($2.06 million) in other states, suggesting they don't live in Louisiana.

What happened to these food stamp violators?  Nothing.  Zero.  Zilch.  Nada.

           

This is inexcusable.  It is yet one more reason why middle class taxpayers--the people who pull the wagon--are so frustrated.  They see people at the top getting undeserved bailouts, people at the bottom getting unearned handouts and themselves getting the bill.

           

Tell your public officials to enforce the food stamp laws.  Those who lie, cheat or steal to get benefits should be prosecuted.  This is a principle on which liberals and conservatives should be able to agree.

1/8/2014
A Plan to Fund Higher Education

Louisiana's colleges and universities need money.  There's a way to help them without raising taxes or tuition:  reduce spending on state government's consulting contracts by 10% and dedicate the $528 million saved to higher education.

 

When Mike Foster was governor, the state's budget was $12 billion.  It was $19 billion under Governor Blanco.  Today it's $25.3 billion.  Over this time, Louisiana's population has grown little and inflation has been low.  This notwithstanding, funding for Louisiana post-secondary education has been cut to the bone.

 

Louisiana spent $1.6 billion from its general fund on higher education in 2008.  We had finally reached the southern average for the first time in 25 years. This year's general fund spending for higher ed is $525 million-a breathtaking 67% reduction.  Even after taking into account tuition and fee increases on the backs of students and parents, total funding on higher ed is down $353 million.  State funding for higher education in Louisiana is down 17.6% this fiscal year alone (3/4s of the states have raised higher ed funding this year), the most dramatic reduction in America, according to the American Association of Colleges and Universities.  Frankly, I don't know how our schools keep the lights on.

           

At the same time, the state is spending more than ever on consultants, many of whom are out-of-state, which means the dollars don't even stay here.  According to the Legislative Auditor, Louisiana has 19,000 consulting contracts spread throughout state government.  Governor Jindal's former top financial advisor testified before the Streamlining Government Commission that 14,000 of those consulting contracts are for $50,000 or more.  For 2005 to 2010, the Louisiana Department of Education alone spent $615 million on 5,499 consultants.  In 2012, total state spending on professional, personal and consulting contracts was $5.28 billion.

           

Why do we need to spend $94,000 in taxpayer money on a California consultant to "assist students to learn valuable social skills through organized play on their recess and lunch periods" (Contract #672113)?  Why spend $874,930 on a consultant to "provide ... assistance to disadvantaged business enterprise companies doing business with DOTD" (Contract #658942)?  Does DHH really need to pay someone $19,500 to "coordinate two Golden Glove Boxing tournaments" (Contract #710616)?  Does the Department of Education need to spend $250,000 in consulting fees to "provide valid and reliable data to parents to support informed school choice decisions" (Contract #674139)?  Why would any reasonable public official spend $57,100 to "inform and educate the Hispanic community ... of seatbelt usage" (Contract #708691), or give precious taxpayer dollars to the Hop 2 It Music Co., the Smile and Happiness Foundation or theLight City Church under any circumstances, but particularly when our colleges and universities and the kids they teach are falling behind the rest of America in a knowledge-based global economy?

           

Some think the way to help higher education is to raise tuition-again.  They are wrong.  Louisiana has a lower percentage of college graduates than any state except West Virginia.  We will not bridge this talent gap and catch up by raising (even more) the cost of a degree.  Besides, since 1985, college tuition in America is up 500%--more than health care or gas or the cost of a home.

           

There's a better way.

           

In 2012, by a vote of 94-0, the Louisiana House of Representatives passed a bill (HB 327) by Rep. Dee Richard that would have directed every agency in state government to reduce its spending on consulting contracts by 10%.  The Senate Finance Committee killed the bill unanimously.  In 2013, the Louisiana House passed the same bill (now HB 73) by a vote of 86-0.  The Senate Finance Committee once more defeated the bill on a 4-4 vote.

 

HB 73 needs to be reintroduced and passed.  According to the nonpartisan Legislative Fiscal Office, it would save $528 million annually, which should be dedicated specifically in the legislation to higher education.  That's not enough, but it's a start.

 

There will be opposition.  Some will argue the bill will harm the state's privatization efforts.  Not so.  HB 73 is about government waste, not whether a vital state service can be provided more efficiently by the private sector.  Some will accuse the legislature of micromanaging.  Not so.  HB 73 does not specify which contracts should be eliminated-that's up to the agencies-or whether any should be eliminated at all.  An agency can meet its goal of reducing consultant spending by keeping all its contracts while negotiating lower prices.  Others will argue that every one of the state's consulting contracts is necessary.  I don't believe it, and I don't think taxpayers do either.  Besides, some of our agency heads make as much as $400,000 a year.  If they can't implement the reduction, I bet we can find someone who can.  Finally, the argument will be made that consulting contracts are funded with federal dollars.  Some are; many aren't.  The answer is to reduce or eliminate the contracts using state money and ask the feds to give us permission to redirect the federal money for the nonsensical contracts to higher ed.  We shouldn't be wasting American taxpayer dollars on frivolous, wasteful consulting contracts anyway.

 

The formula for a better Louisiana is simple:  real jobs for adults and a good education for our children.  We can't have one without the other.

 

This plan will work. The carnage in higher education must end.

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