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13.7.06

Blanco, special interests try to spin her veto choices

All of Gov. Kathleen Blanco, cable companies, and local governments went into damage control mode to justify the special treatment handed out to certain special interests, to the detriment of consumers and taxpayers, with her recent veto decisions.

Blanco is fooling nobody by her issuance of an executive order which will have nongovernmental recipients of line item largesse in the state budget submit documentation and financial statements regarding their uses of the funding. All it does is to require reporting, it does not mandate any evaluation of the actual merits of the uses to which the money is put. True accountability would be to make sure the spending is in accordance with an essential need of the state. Or, as Treasurer John Kennedy noted, the time to scrutinize questionable projects is before they get into the budget, not after they have been put there by legislators.

Cable television interests attempted to spin away criticism of the veto of HB 699, which leaves its provision essentially in a monopoly controlled by them and local governments. Sharon Kleinpeter, vice president of governmental and public affairs for Cox Communications (which, by the way, is reducing its presence in the state with the recent completed sale of its north Louisiana operations), said the bill was unnecessary because there are no real barriers to competition in the cable industry.

That’s not entirely true. The barrier is local government’s attitudes and economic reality – nothing in the law requires any government to accept any offer to provide services. At present, the large fixed costs for provision of infrastructure makes it prohibitive to new entrants. Thus, one part of HB 699 would have waived off certain costs to new entrants in order to encourage competition – costs, in fact, emanating from the whims of local governments. One was the ability of local government to use pass-through fees on cable subscribers to raise revenue, a stealth fee increase on its citizens. Another was mandating “buildout,” meaning forcing providers to create supply in economically unviable parts of their jurisdictions. Both mean higher rates, one as a fee, and the other as a subsidy.

This is why HB 699 would have reduced costs to consumers and provided more choice. And that’s why both local governments and cable companies fought it – the former to protect its additional revenues, the other to protect its monopoly status, with the latter point brought home when Cox immediately raised its rates in two locations the day of the HB 699 veto.

Thus, it is with incredible arrogance and/or stupidity that one representative of local interests, Roland Dartez, executive director of the Police Jury Association of Louisiana, said, “We really think we’re going to be able to protect the consumers a lot better this way.” No, it just protects your ability to squeeze more out of them. It is also with incredible skepticism that one should greet Louisiana Municipal Association Executive Director Tom Ed McHugh’s statement, “We can work with the industry … to get them out competing quicker than the bill itself.”

If McHugh is serious, he’ll ask for legislation which gets rid of the stealth fee increase ability of local governments and negates buildout provisions. After all, if rates do go down with competition, demand will increase supply which will bring more money into government coffers from the sales tax on the rates and it will increase the economic incentives to supply in areas previously unprofitable. If he doesn’t, it shows his group's members merely wants to protect their power and privilege.

Legislation along these lines needs to reappear and pass next session. Maybe in an election year Blanco will listen more closely to the people than to special interests.

12.7.06

Blanco veto decisions shows love of big government

So let’s see, according to Gov. Kathleen Blanco, (1) you use your line item veto on state spending projects either if the spending is going to be restored or it’s connected to somebody facing legal woes, and (2) you veto bills when it’s uncertain whether local government revenue would decline to the benefit of ratepayers but you sign them when it’s certain local government revenues will increase at the expense of taxpayers.

That the larger message Blanco delivered in her series of veto and related messages concerning the most controversial bills of the session at her deadline to deal with them. It started with her poor explanation for the veto of HB 699 which would have introduced competition to the provision of cable television by granting telephone companies entrance into it by statewide franchise.

Why this was a good bill and refuting the specious arguments of its opponents has been addressed previously. Blanco wrote that she vetoed it because it was uncertain whether there would be a loss of revenue for local governments, causing the need for tax increases or service cuts.

She’s probably right, but for the wrong reason. Under the current local franchising agreement law, local governments can charge fees to ratepayers that get cable television which have nothing to do with its provision – in other words, a backdoor way of raising revenues on the back of ratepayers. HB 699 would not have permitted this although it would have apportioned monies from rates paid through the statewide franchise to local governments in relation to the number of subscribers. So, local government would lose the ability to impose stealth revenue fees – but that’s something good, not bad. Blanco shows who’s side she’s really on here – bigger (local) government, not their citizens.

Blanco also questioned (but, again, with no certainty) that the bill might violate laws dealing with local government property rights. Let’s say it did, that’s an easy one to solve – change the law if the HB 699 were found by the courts to do that. Maybe she forgets that (with the exception of a few local governments whose charters existed before the latest Constitution) the state has the last word on what powers local governments have in this area. And, in no way does HB 699 interfere with existing contracts – but even if it did, why not just offer the same statewide franchise to existing franchisees next year?

She seems concerned about hypothetical situations that could hurt (but, as noted above, actually would help many) taxpayers with HB 699, but with HB 1281, she just lets it go. This bill would steer tax dollars from state coffers to special interests in Jefferson Parish. Even with this certainty, she signed it, and then tried to have it both ways by arguing she had worked out a deal with Parish President Aaron Broussard essentially not to implement it and state Rep. and author of the controversial portion of the bill John Alario to change the new law next session.

Promises are nice, but what if Broussard doesn’t get reelected this fall? Or if Alario can’t get the bill to pass (assuming he genuinely tries to do so)? If Blanco really meant to short-circuit this favor, she would have vetoed the bill and not left its non-implementation to chance. Renovating historic structures in Baton Rouge wouldn’t be any less likely to happen if the ability to use tax increment financing was delayed a year. Instead, we must conclude either she is too trusting or trying to save face.

And, despite millions of dollars of funding going to local government who often don’t really need some project or to private organizations that have no accountability requirements and no real benefit to the entire state in their state-funded activities, she approved over 90 percent of such spending – and most of what she didn’t she admitted likely would be restored soon. Almost half of the rest of her vetoed spending was connected to someone who had legal troubles and who was getting bad press for it; little else did Blanco consider it worthy of a veto, almost none of it from $32 million of “special legislative projects.” Again, Blanco would rather cozy up to (big) local government and placate powerful political allies than direct resources to help the entire state.

Simply, Blanco’s explanation of her actions on these bills ring hollow. She loves big government, thinks it can solve all problems, and proved it with these actions and explanations of them.

Blanco decisions favor special interests, snub people

Gov. Kathleen Blanco made clear where her loyalties are with her actions of what bills to sign and to veto with the 2006 Legislative session – doing the bidding of special interests, certainly not on the behalf of the people.

On the one hand, she signed HB 1281, as well as HB 658. These bills allow special interests in Jefferson and Sabine Parishes to siphon off state money indefinitely and to receive favorable land deals. On the other hand, she vetoed HB 699 which would have brought more competition and lower prices to consumers for cable television; instead, she kowtowed to greedy cable television companies and to the voracious appetites of local government for more of the peoples’ money.

She also largely whiffed on line-item vetoes in the state’s operating budget. A handful of small items being refused hardly rids the budget of millions of dollars of unnecessary spending that should be the responsibility of local governments to fund on their own or represent outright gifts with no accountability to private organizations. Again, she would rather please politically-connected special interests than to be a proper steward of the people’s resources.

What does it take for this opportunist to put the people, not governments and special interests, first? Do they have to rise up in mass to articulate their disgust? That’s the impression left with a veto it seems Blanco unwillingly did cast, against HB 1028 which would have allowed state legislators to give themselves premium access to state insurance even if they are only part-timers.

It shouldn’t have to come to that, and these poor decisions give yet one more reason why Louisiana cannot wait until she leaves office.

11.7.06

Redistricting soon both possible, essential for Louisiana

After the U.S. Supreme Court recently affirmed that states could reapportion themselves at any time, Louisiana has a strong case to do so with its Legislature as a result of the hurricane disasters of 2005 which has caused the state’s population to lose at present as many as 300,000 people and has dramatically shifted population patterns within it.

On the one hand, for representative democracy to actually be so, equiproportionality must exist among these districts, or else rotten burroughs spoil things. On the other hand, the statistical basis on which to do so is fleeting unless the state commits a good chunk of change to carrying out some kind of census.

While some may contend the wide variances in district populations must be tolerated until the next federal census and the 2011 election cycle, there is some middle ground here. The need is obvious; for example, turnout in the 2006 primary in New Orleans’ flood-ravaged District E was nearly half that of the 2002 primary turnout, down about 20 percent, even with heroic get-out-the-vote efforts funded by state taxpayers.

The state should proceed by petitioning to the Department of Justice that the state use registered voters as the basis on which to reapportion during the 2007 session for that election cycle only, based upon the Court’s 1966 ruling in Burns v. Richardson. There, the court allowed Hawai’i to do just this until the 1970 census information became available because of a large transient population. In this instance, citizen displacement and the influx of a transient population because of the hurricanes should merit similar treatment.

If pre-clearance is granted by Justice, the new districts could be in place by next July at minimal expense. That’s still about two months before qualifying, leaving plenty of time for campaigning in the new districts.

Whether political considerations will allow this to happen is another matter. But fairness to the citizenry dictates that the state makes the effort to ensure that all voices get heard equally, justifying the redistricting.

10.7.06

Blanco has chance to walk the walk with line-item vetoes

So Gov. Kathleen Blanco starts getting some political heat about her saying one thing, getting rid of budget categories that steered state money to local requests at the whim of legislators with her permission, then doing another, permitting he same kind of items back into the budget and saying she had no real plans to scrutinize them any more than in the past. Then she turns it up so more on herself by blaming the situation on state Treasurer John Kennedy, who noted that he has no formal power in the area, but who then accepted her invitation to come up with a list of line-item vetoes.

The biggest project on the $9.2 million list is the $500,000 going to the Louisiana Leadership Institute, the child of state Sen. Cleo Fields to steer money into his district for “a nonprofit organization providing programs and services to build leadership, improve academic skills, increase self-esteem and inspire motivation in Baton Rouge area students.” Apparently, fielding a prize-winning marching band is one strategy to boost this self-esteem: the group’s band won the “Battle of the High School Marching Bands” last November in Carson, CA, winning money to buy new uniforms and instruments even as tens of thousands of taxpayer’s dollars were spent to send the band there while the state struggled to recover from the hurricane disasters. (Meanwhile, third place Monroe’s Carroll High School didn’t get anything extra from the state.)

Fields was somewhat upset by Kennedy’s recommendation, acknowledging that maybe he ought to find non-governmental sources of funding if there was going to be some much capriciousness in the process. It’s rather interesting that Fields only now has come to some realization that he ought to wean the organization off of taxpayer dollars, since he’s been doing the opposite for many years – the group got $75,000 in 2001, $200,000 in 2002, $300,000 in 2003, $500,000 in 2004 and 2005, and the $500,000 this year plus two other separate line items worth an additional $200,000.

This item is an excellent example of what ought not be in the budget. If the state thinks sending bands to California is a service it ought to be performing, then either it should create a program in state government to do this so that this can face legislative and/or bureaucratic scrutiny, or it should create a competitive grant program to have nonprofit organizations accomplish this. Earmarking money straight out of the general fund with next to no oversight on its use is just bad public policy.

If this is indicative of the other 200 items listed by Kennedy, vetoing the entire contents of his list would show that Blanco just doesn’t talk the talk, but walks the walk when it comes to making Louisiana government more efficient – especially when the state remains a supplicant to the federal government for disaster-recovery funding.