BATON ROUGE, La. (AP) — Louisiana will borrow $100 million to repair and improve rural roads around Louisiana, in a plan scaled back Thursday by state officials grappling with a shortage of construction funds and trying to stay under the state's debt ceiling.
The Bond Commission agreed without objection to sell bonds to investors for upfront cash for road work in 37 parishes. But the plans were cut from $250 million to $100 million because of concerns about breaching the debt cap.
Commission member Rep. Jim Fannin sponsored the bill that authorized the rural road borrowing and pushed for the bond sale — even at the smaller size.
"It's not just rural roads. It's about putting people to work and doing the right thing for the state," Fannin, D-Jonesboro, said.
The dollars will pay for construction on roads not eligible for federal matching money in the highway program. The debt will be paid off with registration and license fees and taxes on commercial trucks and trailers.
Commission members reduced the rural road borrowing as part of overall discussions of how to deal with a shrinking pool of funds for construction work and with a limited amount of borrowing capacity remaining under the state's constitutional debt limit.
The state borrows money to pay for construction projects through bond sales to investors, with the debt paid back with interest over decades.
That pool of funding, which pays for items like road improvements, college building repairs and economic development projects, is running dry. And the state is teetering so close to its debt ceiling that the ability to borrow more is limited.
The construction project fund will run out of cash within five months, said commission director Whit Kling.
He said the state has enough borrowing capacity under the state debt limit to keep construction work going for another nine to 12 months with another bond sale.
But he warned that without a multiyear plan to restructure the debt, the state will be on track to breach its ceiling in the 2014-15 budget year if it borrows up to its full capacity in the next few months.
"You can address the liquidity issue now ... but if you don't address the structural imbalances and the legal constraints with a work-out plan, you'll hit the wall. You will not be able to issue any more debt," Kling told the commission.
The funding crunch stems from lawmakers and governors approving $1.1 billion more in lines of credit for construction work over the last 12 years than they borrowed or appropriated money to pay for, Kling said.
Meanwhile, stagnated state income and the economic downturn kept the debt limit lower than expected. The limit requires that the state's annual debt-repayment requirements fall under 6 percent of the state's yearly income from taxes, licenses and fees.
The Jindal administration, top lawmakers and Treasurer John Kennedy — all members of the Bond Commission — planned to discuss ways to refinance and restructure Louisiana's existing debt to keep the state clear of breaching its debt limit.
Kennedy, chairman of the commission, said he expects the panel next month to consider a bond sale to keep the construction fund filled with enough money to avoid projects grinding to a halt.
"I will feel a lot better when we know that we have enough money in the account to get us through the year," he said.
JUNE 17 If anyone ever wonders why Saints fans hate Atlanta with a capital H, here's a good indication. Radio "professionals" at an Atlanta station created an entire segment around making fun of former Saints player Steve Gleason, who is now paralyzed by ALS. Listen, nobody's ever accused DJs of being rocket scientists. But how could someone think it is amusing to pretend to ask a man with a degenerative, fatal disease if he will be alive next week? The DJs have been fired, and are now whining about how gutless their former bosses are. Wow.
JUNE 18 Here's the latest from the Advocate on the fatal hit-and-run accident allegedly involving the president of the Livingston Parish School Board. He's accused by police of hitting a 21-year-old man on a highway early Sunday and driving away. The man died at a hospital later. On Monday, police seized the president's truck and towed it away. But he's available for board meetings: apparently a $500 bond is sufficient for this type of thing over in St. Helena Parish.
JUNE 18 Former broadcast journalist Griffin Scott has posted this plea on his blog for financial assistance from his readers. Scott, who says he was fired after he wrote something fairly innocuous (for Facebook) on his wall, is suing a media giant for his job back. He's framed himself as David going after a bloated media giant, and he's probably not far off.
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JUNE 17 Political columnist John Maginnis has some advice for Louisiana Republicans: grow up. After the schism that occurred in this past session - fiscal hawks teaming up with Democrats to spank the Republican "majority" and hand Gov. Jindal his, er, aspirations for continued solon control -- they need to figure out how to get along with each other, Maginnis writes.
JUNE 17 Here's the Picayune's obit story for Dorothy 'Miss Dot' Domilise, the lady who made poboys at the uptown restaurant that bears her name. Miss Dot moved to New Orleans during World War II, where she met and married her husband Sam. When she passed away Friday she was 90, and had spent more than 60 of those years working at the restaurant on Annunciation Street.
JUNE 17 This editorial in the Advocate speaks in favor of the consent decrees that have federal judges overseeing police operations and the sheriff's parish prison in New Orleans. Mayor Landrieu and Sheriff Gusman can't get along, so outside forces, like the Inspector General and the judges, are needed to make sure things run right, the editorial opines.
JUNE 18 Here's a post from Manny Schewitz on Forward Progressives that is good for a chuckle. Manny had an epiphany back in November, and is sharing it with us today: he believes that Fox "News" is killing the GOP by pandering to right wing nuts. Now, don't get it twisted: Manny's not broke up about it. He says he enjoys watching the downward spiral with a shot of whiskey and "a schadenfreude chaser."
Frank’s Casing Crew, now doing business as Frank’s International, will make its final appearance on ABiz’s list of the Top 50 Privately Held Companies in Acadiana this year, and once again, it will likely be at the top with more than $1 billion in annual revenues. The 75-year-old company specializing in tubular fabrication and installation services to the oil and gas industry plans to go public this year.
The defeat, or rather highjacking of House Bill 420 in the final days of this year's Legislative Session, say Reps. Vincent Pierre and Terry Landry, is the result of the propaganda spread by one unidentified local media outlet and an unnamed former state Representative, but nothing to do with the original legislation's lack of checks, balances or details.
He’s a singer. A songwriter. A piano man. A family man. He’s even got his own Wikipedia entry. He’s David Egan. And he knows ancient secrets about the monolithic stones of Stonehenge that he’s not willing to share.