Last month, Officials with LUS and Lafayette Consolidated Government met with bond rating agencies Moody's and Standard & Poor's in New York to give a detailed presentation on the fiber project. LUS Director Terry Huval fielded a number of questions from the agencies on everything from state law and lawsuits affecting the project to the overall financial health of LUS, LCG, and the regional economy.
Louisiana state law provides LUS can only indirectly back the bonds on the project, through fair market loans to its new communications division. "We're plowing through a lot of new territory here," Huval says. "I don't know if there's been very many entities that have issued bonds for a communications system like this. So there's a lot of attention being given here."
At the end of the day, Standard and Poor's gave the project an A- rating and Moody's awarded an A2. Both ratings are only one step below LUS' regular utility bond rating of A and A1. But with bond insurance, purchased through XL Capital, LUS will still receive a AAA rating with investors. That translates into an interest rate slightly under 5 percent for the approximately $110.45 million in bonds LUS is selling for the project.
"We were very pleased with those results," Huval says. "We've got the best rating we could have hoped to have gotten out of this." He adds that the bond agencies spoke highly of both LUS' ability to handle large projects, such as the two new generating plants that were built on time and on budget, as well as the merits of the fiber initiative. "They commented favorably about our commitment and vision on the project," Huval says. "I think they also saw that this could be a very powerful thing for a community to be able to do."
LUS' bond sale faced multiple lawsuits related to the public utility's ability to back up the sale on behalf of its communications start-up. Earlier this year, the state Supreme Court ruled in favor of LUS on the issue, allowing it to move forward with its bond sale. LUS first introduced its initiative to operate a citywide network offering phone, cable and high-speed internet to residents in 2004. City voters approved a measure to allow LUS the ability to issue up to $125 million in bonds for the project nearly two years ago, in July 2005. Huval says the legal delays, brought both by BellSouth and mysterious resident-opponent Elizabeth Naquin, have unintentionally helped the project in some ways. "Technology-wise and know-how wise, we now have a number of advantages as a result of the delays," Huval says. "There's a lot more experience that folks have and the engineering company we brought in, Atlantic Engineering, is already providing us a lot of insight."
This summer, LUS will work on preparing a bid package for construction of the project, which should be under way before the end of the year. LUS hopes to begin serving its first customers starting in 2009.
MAY 21 Gambit columnist Clancy DuBos writes about the Mother's Day shooting, and how the stages of shock and blame and healing mirror those traveled by the same city following Hurricane Katrina. The city will recover, just as it did following the storm, by reaching out to help the people injured most seriously by the event, DuBos writes. It's how we heal, he says.
MAY 21 Here's a post on the Advocate (but buried on a subpage, not on the front) that reports something Louisiana Voice reported some time ago: a top DOE official lives in Los Angeles and "commutes" to Baton Rouge. The positioning of the story caused a stir on Facebook Monday, with several posters asking if the Advocate was covering someone's hiney. Sentell's stories on DOE are notoriously soft, and this one is no different: don't expect any hard questions in here.
MAY 21 Here's another post from blogger Tom Aswell about the "course choice" program. He's already reported on kids being signed up without their consent or knowledge, and has more here: For example, he tells of a six-year-old who was signed up for high school Latin. He also digs a little deeper into the sister companies of the main one operating in Louisiana; all of them seem to have complaints against them. Stinky.
MAY 21 Given the 80 percent cut in higher ed funding since he's been in office, it's clear Gov. Jindal would rather give tax cuts to out of state companies than have a functioning system, blogger Dayne Sherman argues in this post. The cuts have been such a disaster, Sherman says, that it will take 30 years to fix what's been broken. He says he believes the aim is to shut down most of the schools before Jindal leaves in 2016.
MAY 21 Blogger CB Forgotston says there are too many elections in Louisiana, and they're costing us too much money. The proof is in the pudding: turnout for most of these nonsensical pollings gets worse and worse, CB opines, even as millions of dollars that could be spent on health care or higher ed go down the tubes. The legislature must take action to stem the tide of pointless elections, he says.
MAY 21 Here's an interesting investigative piece by WVUE on the retirement benefits of some Jefferson Parish public employees. According to the story, the taxpayers are paying 100 percent of the retirement contributions of employees who started work prior to a certain date in April 1986 -- and have done for more than 30 years. It costs the parish millions annually, and might not be legal, the story reports.
MAY 21 This post on Bayou Buzz provides insight from Louisiana's intrepid pollster, Bernie Pinsonat, on the winners and losers from this year's legislative session. But to hear Bernie tell it, there's almost nuttin but losers: Jindal, the Republican party, the Fiscal Hawks all get big goose eggs in his win column.
MAY 20 This post on The Lens takes a look at a huge (either $500K or $250K) bill that one NOLA charter now has for school lunches. The RSD says the charter group didn't fill out the proper paperwork for federal reimbursement, but the story details how the RSD didn't ensure the people running the charter had the proper training, despite requests from hapless charter employees trying to fill out forms. Either way, somebody's asleep at the wheel.
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