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|State Bond Commission Approves $486 Million for Local Projects|
BATON ROUGE, LA - The State Bond Commission approved $486 million for projects statewide and saved taxpayers more than $29 million at its March 19 meeting, according to State Treasurer John Kennedy.
"The state may be spending more than it takes in, but the State Bond Commission is saving money for taxpayers through lower interest rates," said Treasurer Kennedy. "We were able to achieve more than $29 million in savings this month. Our work directly benefits the public."
Among the individual projects approved were:
- Beauregard Parish, $7.6 million in General Obligation School Refunding Bonds for the Beauregard Parish School Board, Parishwide School District: saving taxpayers $207,000.
- Bossier Parish, $12 million in General Obligation School Refunding Bonds for the Bossier Parish School Board, Parishwide School District: saving taxpayers $568,000.
- Bossier Parish, $20 million in Revenue Bonds for the Louisiana Community Development Authority's City of Bossier City, Louisiana Project: for additions, acquisition, repairs and/or expansions needed to maintain works of public improvement.
- Bossier Parish, $11.75 million in Revenue Refunding Bonds for the Louisiana Community Development Authority's Bossier Parish Public Improvement Project: saving taxpayers $521,000.
- Caddo Parish, $3.5 million in Water Revenue Refunding Bonds for the town of Blanchard: saving taxpayers $255,000.
- East Baton Rouge Parish, $75 million in Road and Street Improvement Sales Tax Revenue Refunding Bonds for the Metropolitan Council of the Parish of East Baton Rouge and City of Baton Rouge: saving taxpayers $4 million.
- East Baton Rouge Parish, $26 million in General Obligation School Refunding Bonds for the Zachary Community School Board, Zachary Community School District No. 1: saving taxpayers $1.7 million.
- East Baton Rouge Parish, $155 million in Revenue Refunding Bonds for the Board of Supervisors of Louisiana State University and Agricultural and Mechanical College: saving taxpayers $7 million.
- East Baton Rouge Parish, $40 million in Subordinate Lien Revenue Bonds for the Louisiana Community Development Authority's Parish of East Baton Rouge Road Improvement Project: for constructing new public roads and streets and/or the widening of existing public roads and streets.
- East Baton Rouge Parish, $15 million in Revenue Bonds for the Louisiana Community Development Authority's Perkins Road Memory Care, LLC Project: for (1) acquisition, design, construction, furnishing and equipping of an approximately 33,000 square foot memory care facility in East Baton Rouge Parish and (2) funding a reserve fund, if necessary.
- Jefferson Parish, $52 million in Sales Tax Refunding Bonds for the Jefferson Parish School Board: saving taxpayers $2.5 million.
- Jefferson Parish, $17 million in Multifamily Housing Revenue Bonds for the Louisiana Community Development Authority's GMF- Bellemont Apartment Homes Project: for acquiring, rehabilitating and equipping a 291 unit multifamily housing complex located in Metairie, Jefferson Parish.
- Orleans Parish, $50 million in Hospital Revenue Refunding Bonds for the Louisiana Public Facilities Authority's Touro Infirmary Project: saving taxpayers $11.76 million.
- Ouachita Parish, $450,000 in Water Revenue Bonds for the Prairie Road Water District: for constructing and acquiring improvements and extensions to the waterworks system, including equipment and fixtures.
- Pointe Coupee Parish, $300,000 in Limited Tax Certificates of Indebtedness for the Pointe Coupee Parish Police Jury: for constructing and improving gas facilities.
- Richland Parish, $875,000 in Sewer Revenue Bonds for the town of Delhi: for constructing and acquiring improvements and replacements to the sewerage system, including appurtenant equipment and accessories, a work of public improvement.
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.
|State Revenues Down|
BATON ROUGE, La. - The February 2015 Net Receipts Report shows that total state revenue thus far for 2014-2015 was $5.320 billion, a one percent decrease compared to that time last year. Total revenues also were down one percent in January compared to the previous year, reflecting weak personal income tax collections and falling severance tax receipts.
The state estimated in May 2014 that the state general fund would grow by 4.3 percent this year. Instead, revenue collections are down one percent with four months left in the fiscal year.
General sales tax cash receipts for FY 2014-2015 to-date are $1.846 billion, for an increase of $94 million or 5 percent compared to last year. General sales tax cash receipts this time last year were $1.752 billion, which was $15 million more than the prior year.
Individual income tax cash receipts for FY 2014-2015 to-date are $2.133 billion, for a decrease of $18 million or 1 percent compared to last year. Individual income tax cash receipts this time last year were $2.151 billion, which was $99 million more than the prior year.
General severance tax cash receipts for FY 2014-2015 to-date are $565 million, for an increase of $9 million or 2 percent compared to last year. General severance tax cash receipts this time last year were $556 million, which was $1 million less than the prior year.
Corporation and franchise tax cash receipts for FY 2014-2015 to-date are $209 million, for a decrease of $166 million or 44 percent compared to last year. Corporation and franchise tax cash receipts this time last year were $375 million, which was $272 million more than the prior year for an increase of 264 percent.
Gasoline and special fuels tax cash receipts for FY 2014-2015 to-date are $406 million, for an increase of $12 million or 3 percent compared to last year. Gasoline and special fuels tax cash receipts this time last year were $394 million, which was $9 million more than the prior year for an increase of 2 percent.
Miscellaneous taxes cash receipts for FY 2014-2015 to-date are $153 million, for an increase of $22 million or 17 percent compared to last year. Miscellaneous taxes cash receipts this time last year were $131 million, which was $24 million less than the prior year for a decrease of 15 percent.
To view the report in its entirety, visit www.latreasury.com and click "Net Receipts Statement for the Month of February 2015."
|Treasurer Kennedy: Don't Waste Remaining Portion of Tobacco Settlement |
BATON ROUGE, LA -State Treasurer John Kennedy urged the Division of Administration Wednesday to reconsider selling the remaining portion of the state's tobacco settlement.
"Any farmer knows it's a bad idea to sell your seed corn because then you can't plant next year's crop," said Treasurer Kennedy. "By selling the rest of the tobacco settlement, we'll be adding to the structural deficit in the budget. We should fix the budget, not sell off yet another taxpayer asset like a junkie selling his TV or smartphone to buy another fix."
Treasurer Kennedy led the effort to sell 60 percent of the state's tobacco settlement income stream to investors in 2001 to hedge against the possibility of tobacco companies declaring bankruptcy. The money went into a trust fund that earns money for health care, education and TOPS.
In the past few years, the state has sold property, spent all the money in the Medicaid Trust Fund for the Elderly, raided the Artificial Reef Fund, taken money out of the state employee health insurance claims fund and declared numerous tax amnesties in order to generate one-time cash to fix holes in the budget, which has caused a $1.6 billion structural deficit. Moody's and Standard & Poor's have put Louisiana on negative credit watch as a result. The Division's new proposal would sell the remaining portion of the tobacco settlement in order to generate $750 million for spending. The settlement stems from tobacco companies' settlement of lawsuits over states' smoking-related health care costs.
"My fear is that all $750 million of this money will be spent. Everyone will want a piece of the pie," said Treasurer Kennedy. "That will only add to our structural deficit, and, besides, what will we do next once the money is gone? We've got to stop thinking about the next election and begin thinking about the next generation. Hocking the family silver to pay the rent is not the answer. Don't hold this fire sale."
|Higher Education Can and Must Be Saved|
If you look long enough at the cuts to our higher education budget, you begin to feel like Alice in Wonderland tumbling down that deep rabbit hole. You don't know when the nightmare is going to end.
A report by Moody's Investors Services told the nation what we in Louisiana already knew. Our public colleges and universities have suffered deeper budget cuts than anywhere else in the U.S. over the past five years.
Charts by the Center on Budget and Policy Priorities show we're digging ourselves deeper and deeper into a hole.
In 2013, Louisiana was second to New Mexico in the negative change to state spending per student with inflation adjusted. Now Louisiana stands first, spending $5,004 less per student. Our neighbor to the east, Mississippi, is spending $2,524 less per student. Texas has managed to spend only $1,996 less per student.
Moody's warned that Louisiana's colleges are ill-equipped to face additional credit stress. In simpler terms, Moody's is warning that it will slash the credit ratings of our colleges and universities unless we clean up our budget mess. Our higher education system doesn't need a lower credit rating on top of the budget cuts. A lower credit rating would make it more expensive to borrow money when it's time to build new dormitories or fix the chemistry lab.
Thus far, we've settled on raising tuition as the solution to our problems. As Alice found when she ate the "Eat Me" cake and outgrew the room, bigger isn't always better, especially when it means taking a bigger chunk out of our families' household income to put kids through college. That's a tax increase, even if you don't call it one.
So let's stop taking more and more money out of our taxpayers' pocketbooks. Let's not even have a discussion about new tax increases. We don't need to raise taxes.
The state budget under Governor Mike Foster was $12 billion. Now it's $25 billion. Unless we're giving every state worker a $120,000 LS Lexus Hybrid to tool around the state in, we have enough money to meet our needs. All we need to do is stop foolish spending.
A report by the Public Affairs Research Council of Louisiana estimated we could save $300 for every Medicaid patient who goes to a doctor's office or a clinic instead of the emergency room. Why is that significant? Medicaid and uninsured patients in Louisiana make 900,000 visits to the emergency room each year for routine care. Get a handle on that problem, and the savings are in the hundreds of millions.
Another problem - and it's one I've talked about so much that even I'm getting a little tired of punching the alarm button - is the number of consultants on the government payroll. We have 19,000 consultants. Would you believe we've paid someone to teach people how to use Facebook?
Let me tell you about Edythe Kirchmaier. Teddy Roosevelt was president when she was born. She knitted care packages for World War I soldiers. Now age 107, she recently became Facebook's oldest registered user. And she did it without the help of a paid consultant. You can follow her on Facebook. If you're unsure how, just ask Edythe to teach you.
The Louisiana Legislature will convene in April to debate the state budget in earnest. Legislators will have to figure out how to fill a $1.6 billion budget hole. I hope they don't continue to devastate higher education with cuts. I hope they don't hire more consultants. I hope they settle on sensible solutions that get us back into credit rating agencies' good graces and set the state on a smooth course for the future.
|Leave TOPS Alone|
The year was 1988. A successful New Orleans businessman named Patrick F. Taylor had a speech to give. His audience was 183 restless middle schoolers who weren't college bound. Heck, many weren't even high school bound. They were biding their time until they could drop out of school.
Instead of a pep talk, Taylor decided to make a pitch. He would pay for the kids to go to college if they kept going to class, stayed out of trouble and maintained a "B" average. With that promise, Taylor established the building blocks for TOPS.
TOPS (the Taylor Opportunity Program for Students) is the state-funded college scholarship program that has benefited more than 200,000 kids in Louisiana. It doesn't just send kids to LSU or Southern. It sends them to truck driving school if they want to drive a truck. It sends them to court reporting school if they want to become a court reporter. In other words, TOPS fulfills dreams.
Now some will tell you that TOPS has become too expensive. They'll tell you the sky is falling. They'll tell you the state budget is on a collision course, and TOPS is helping fuel the inevitable crash. They'll tell you that changes can be made gradually to make the program more affordable for the state. Here's what I say: Leave TOPS alone. We can't afford to diminish what TOPS does for our state.
The Hamilton Project, an arm of the Brookings Institution, crunched the numbers last year on what a college degree is worth. Not surprisingly, a degree in chemical engineering is more of a moneymaker than a drama degree. Also not surprisingly, any degree is better than no degree. The Hamilton Project's conclusion: "Median earnings of bachelor's degree graduates are higher than median earnings of high school graduates for all 80 majors studied." For every successful college dropout like Bill Gates, there are a thousand other dropouts clocking in at minimum wage jobs and not making a living wage.
Patrick Taylor knew the importance of a college education. He left home at 16 and made his way to LSU, which didn't charge tuition at the time. Today, it easily costs $10,000 in tuition and fees a year to attend LSU as a full-time student once books and summer classes are included. That's a hefty bill for a middle class family with four other kids still at home.
Now I don't want to shock you, but Louisiana is not a wealthy state. Median income is well below the national average. We're rich in culture, food, history and tradition. Economically, we often struggle. That's why education is so important. Our future can be better than our present or our past, but only if our kids go to school.
We offer our kids a free elementary school education. We offer them a free high school education. But a high school education isn't always enough. We need to continue to offer young Louisianians help with a college education if we expect them to succeed in a keenly competitive, global, knowledge-based economy. We also need to continue to give them an incentive to stay in Louisiana, instead of migrating to Denver and Dallas and Atlanta.
Georgia has a form of TOPS. It's called HOPE. In 2011, big changes were made to HOPE - changes that were made in the name of saving the state money. Suddenly, technical college students had to maintain a higher grade-point average. Tuition assistance was slashed. The result was that 62,504 fewer kids received HOPE. Within two years, Georgia backpedaled on the changes.
We should not make the same mistake in Louisiana that Georgia made. TOPS has been a roaring success. Sixty nine percent of the more than 62,000 students who received an initial TOPS payment between the 2002-03 and 2006-07 academic years graduated from a Louisiana public college. That's a triumph.
I'll leave you with Patrick Taylor's take on why TOPS matters: "Attendance at public colleges and universities must be based on the ability to learn and not the ability to pay."
|Let People Pray at LSU|
Fifty years ago, administrators at the University of California at Berkeley tried to curtail free speech on campus. They quickly had a situation on their hands: Hundreds of protesters materialized, a priest clambered onto the top of a police car to quiet the crowd and students swarmed the Administration Building. Eventually, the governor intervened, telling the university's president to broker a truce. The Free Speech Movement was born.
Maybe you weren't a child of the 1960s. Maybe you weren't even alive in the 1960s. Rest assured, the 1960s were more than Woodstock, bad hairdos and really good music. The era helped cement the idea that college campuses are a place for intellectual freedom and free speech.
A Christian prayer rally featuring Gov. Bobby Jindal that's scheduled for January 24 at LSU in Baton Rouge should take place as planned regardless of what you think of the organizers or what you think about the rally's content. Free speech is just that, the freedom to speak your mind. I can think of no better forum for free speech than a public college campus.
Our colleges teach our young people and stimulate their minds. It's on campuses that they explore the issues and find their own voices. Students deserve a full catalog of choices.
Fifty years after the Free Speech Movement, however, there are some who want to muzzle the First Amendment right to free speech on college campuses. They are wrong. "I do not agree with what you have to say," the 18th Century philosopher Voltaire once said, "but I'll defend to the death your right to say it." Voltaire was also a staunch advocate of freedom of religion, realizing, correctly, that freedom of speech and worship are inextricably related.
U.S. Supreme Court Justice William Douglas put it this way: "The framers of the Constitution knew human nature as well as we do. They too had lived in dangerous days. They too knew the suffocating influence of orthodoxy and standardized thought. They weighed the compulsions for restrained speech and thought against the abuses of liberty. They chose liberty."
The objections being raised to the LSU prayer rally are undoubtedly sincere, even if you don't agree with them. The primary objection is with the rally's sponsor, the American Family Association, a religious group that opposes gay marriage and homosexual rights. The LSU Faculty Senate and many students have characterized the prayer rally as damaging to the university's reputation. Protests are planned. Both the prayer rally and the protests should be allowed to take place. It's a slippery slope when you tell people whose opinions you disagree with that they can't speak or assemble or worship their God on a college campus. Intellectual freedom is about the free exchange of ideas.
Full disclosure: I'm a practicing Methodist. But I'd feel the same way if the LSU rally was to promote atheism.
Let people pray at LSU. And let people protest too.