Finally, the implications of the recent legislative session’s HB 1281 are receiving mainstream media notice, but that still does not reveal the entire backstory.
While the bill does many things, most notably it creates an unprecedented situation in Louisiana by creating a tax increment financing district mainly to help an existing business, not to generate new enterprises. This is the notorious Tournament Players Championship course which receives a state subsidy; if not enough rounds of golf booked a certain way are sold, the state must make up the difference.
In essence, it creates a bit of a shell game. The state contractually may owe the course money that it would have to carve out of operating revenues. This bill would create a district empowered to pay off those expenses, as well as others, for the course. The catch is the money would come directly into the district, as the bill would allow funds to bypass those which otherwise would go into state sales tax collections.
That the state would have no representation in deciding the use of those funds, other than the Department of Economic Development and the Joint Legislative Committee on the Budget in the dedication of collected funds and the State Bond Commission in reviewing some funds expenditures in authorizing such plans also makes for another unique aspect. In short, the bill provides for a steady stream of what otherwise would be state sales tax revenues into a small area of Jefferson Parish controlled by local officials and interests.
This sweetheart deal is a testament to the legislative prowess of state Rep. John Alario, from that district. Even though he didn’t secure himself a seat on the conference committee dealing with this bill in the waning days of the session, he still managed to insert this provision, which wholly changed the nature of the bill, and sprung it on the House on the last day of the session.
Some unusual things happened prior to its being taken up. First, in order for it and several other late conference committee reports even to be considered then, the House had to suspend its rules. Then, just prior to its being brought up, bill supporter state Rep. Gil Pinac successfully asked for a rule that would limit debate on it. And the person who presented it was not its author, state Rep. Yvonne Dorsey who was present (and voted for the bill; neither was she, the Speaker Pro-Tem, in the chair), but Alario.
State Rep. Mike Powell caught onto it and led others in opposing the bill, but came up short 58-32 (a few switched to the “nay” side subsequently.) (This was the second time in only minutes that Alario would take to the floor a bill drastically altered in conference that would benefit a Jefferson Parish interest. Prior to the HB 1281 debate, he presented HB 658 by Speaker Joe Salter which was supposed to govern a donation in Sabine Parish; tacked onto it in conference was a state donation in Jefferson to an entity called TCW/Firewall Venture I, LLC. Only Powell opposed it; it has yet to be signed by the governor.)
The incident demonstrates the inadequate present situation where a conference report can be sprung upon a chamber with little time for it to review at the end of a session. House Rule 8.27 does force a layover of a legislative day but that time may well be insufficient to properly digest the changes such as Alario had introduced. (This session, HR 7, by none other than Powell, would have tacked on extra waiting time to any conference report where there were substantial substantive changes made in a bill in conference at the end of a session. That resolution never made it out of committee.)
One of the critics who now have belatedly raised voices against HB 1281 is state Sen. Mike Smith, complaining the incident shows how Gov. Kathleen Blanco allows some interests to run amok in the Legislature. Smith has close ties to Agriculture Commissioner Bob Odom who is locked with Blanco in a duel to control state Democrats, so anything that discredits her helps Odom.
Regardless where from the criticism comes, it’s entirely valid. As previously noted, if Blanco is serious about acquiring reform credentials, she needs to veto this bill.
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