By State Treasurer John Kennedy

The Regular Session of the Legislature began April 25, and there are many worthwhile programs that our senators and representatives will be considering over the next few months. In particular, there is legislation this session that could help complete the single most important economic development and infrastructure initiative in Louisiana I-49 North and South.

Before I talk about the proposed legislation to solve I-49s funding problems, lets take a quick look at the numbers. Completing I-49 would require around $364 million to finish the section from Shreveport to Arkansas and roughly $1.3 billion to complete sections in Lafayette and New Orleans. To pay for the project, the state has asked the federal government to fund 80 percent of the costs with a state match of 20 percent.

One of the main reasons the project is currently stalled is the state does not have a specific plan in place for its portion of the funding of I-49. Communicating a specific plan now for providing the state’s match is a necessity to receive federal funds for the project. There is a way we can do that and move forward with the project without raising taxes.

The Treasury has developed a plan that would enable the state to dedicate the $15 million in excess unclaimed property collections the state receives each year to I-49. The state could take the $15 million, service the debt on $150 million in bonds, and divide the proceeds evenly between I-49 North and I-49 South.Rep. Billy Montgomery is offering this plan as House Bill 654 of the 2005 Regular Session of the Legislature.

In an average year, the Treasury collects between $30 million and $40 million in unclaimed property, and it returns around $15 million to citizens and businesses statewide. The remaining $15 million or more goes into the General Fund until the owners of the unclaimed property claim their money.

As the state’s Unclaimed Property Administrator, I can assure you that this plan would not take anyone’s unclaimed property or change the state’s promise to return it. It would simply direct that the $15 million going into the General Fund each year would be dedicated to I-49 until the owners of the unclaimed property claim it. The full faith and credit of the state of Louisiana will still stand behind its obligation to return this unclaimed property, just as it does now.

In addition, if the state issued unclaimed property bonds to fund its portion of I-49, it would not immediately impact the General Fund. The state would not issue bonds until the federal government put up its portion of funding for the project. Any future impact to the General Fund would also be minimized by growth in unclaimed property collections, which have doubled over the past six years.

We estimate that unclaimed property collections will continue to increase at the same rate or at a faster rate, especially because of the Treasury’s aggressive audit program to collect unclaimed property from businesses that have not turned it over to the Treasury. After a reasonable period of time, there will be little or no impact on the General Fund because the $15 million that is earmarked for I-49 would be replaced by increased unclaimed property collections.

In my opinion, this plan is the state’s best bet for funding I-49. If you would like to learn more, please contact my office at (225) 342-0010, or email me atcomments@treasury.state.la.us.