The East Baton Rouge Parish Redevelopment Authority has become the battleground for an ugly fight between two of the capital area’s most unlikely political foes.
In a fight over funding for the agency, which is tasked with reviving blighted areas, Mayor-President Kip Holden is lashing out at the RDA’s executive director, Walter Monsour, who formerly served as his chief administrative officer and was well-known as one of the mayor’s closest political allies and advisers.
On Monday, the RDA board announced its intention to lobby the Metro Council to overrule Holden by finding $3 million of recurring funds in the city budget to replenish the RDA’s rapidly dwindling budget for operations and redevelopment projects.
Holden has since come out swinging, criticizing Monsour’s $365,000 salary and benefits package, and accusing the agency of misplaced spending priorities, lack of accountability to taxpayers and an inability to work well with other agencies.
Monsour declined an interview, deferring to RDA board chairman John Noland, who said he is dumbfounded by the mayor’s recent hostility toward Monsour and the agency, noting that the mayor championed the bill to create the RDA in the Legislature in 2007.
“I’m not a social scientist, I’m not a sociologist. I’m not a mental health official. I can’t understand it,” Noland said of Holden’s recent comments to the press. “Not only is he repudiating the RDA but he appears to be doing it in a pretty personal and pretty hostile way, and I’m sorry for that.”
The RDA, best known for its two high-profile redevelopment projects in Ardendale — formerly called Smiley Heights — and the planned redevelopment of the old Entergy Building on Government Street, has exhausted both its funds for operations and to take on additional improvement projects.
RDA officials say they’ll be out of business by Dec. 31, 2015, if they don’t find emergency funding to the tune of about $3 million.
“In my view, there is an overarching, even moral obligation on the part of the city and the parish of Baton Rouge to fix the stuff that is broken here,” Noland said. Noland said he’s a supporter of the mayor, and regrets that they’ve embarked on the political warfare, but said he’s not willing to let the RDA die without a fight.
He said Holden is bucking a national trend of major cities that support RDAs or similar redevelopment organizations, both financially and in spirit.
“There are 100 top cities, every one of them has an RDA or is forming one,” Noland said. “Why did I get the mayor that’s opposed to it?”
Holden responded that his obligation is to run the city-parish efficiently and with a balanced budget.
“Don’t I have a moral obligation to make sure the city runs, to make sure there’s a fire department? A police department? EMS?” Holden said Friday.
Holden has been adamant for months, both in comments to the press and to RDA officials, that he would not give the agency additional funds. He said he’s allocated about $7.6 million to the RDA from a combination of general fund money and federal and state grants.
The RDA, to date, has operated on mostly one-time grants and federal funds, including a $3 million grant from the East Baton Rouge Parish Mortgage Finance Authority.
In 2009, the agency was awarded $60 million in New Market Tax Credits, which is a federal program aimed at bringing investments into low-income communities. The tax credits were essential to funding major capital projects, and the administrative fees charged for awarding the credits to developers and other agencies have funded the RDA’s $1.3 million annual operating budget, which mostly provides for staff salaries.
The RDA subsequently has applied for tax credits three times and been denied each time.
Noland and Monsour said the plan all along has been to prove the agency’s value to the community and then ask for recurring city funding. But Holden said the agency relied too heavily on the New Market Tax Credits, failed at securing them and now is looking for a handout.
“They tried something and failed at it and now expect us to save them,” Holden said. “When you are accountable for public dollars, it means you must spend them wisely. If you don’t spend them wisely, you are going to end up in the situation that they find themselves in.”
Holden has previously supported the agency and helped secure the seed money and legislation to get it off the ground. But now he says the agency doesn’t play well with other developers and community groups. He said it hasn’t been effective in redeveloping blighted areas in the community and is irresponsibly funding Monsour’s bloated salary.
“I can tell you we’ve been inundated with people concerned about the salary and benefits package that Mr. Monsour has,” Holden said.
Monsour is paid a base salary of $265,000 plus $100,000 in benefits. Monsour said in an email that the benefit package includes “health insurance, life insurance, automobile allowance, 401(k), etc.” and that his compensation hasn’t changed since 2009.
Neither Monsour, nor Noland, would disclose the breakdown of Monsour’s benefits package or detail the amount of his car allowance.
Noland said he understands the public outcry over Monsour’s salary and accepts responsibility.
“It’s the one thing I wish I could fix,” he said. “When Walter left the city, we recruited him to become our chief executive and he said, ‘I have made a financial sacrifice for four years as the (chief administrative officer) and I’m not willing to do it any longer.’ ”
Noland said Monsour brought much-needed “instant credibility” to the fledgling agency that allowed the RDA to recruit a strong staff. He also said he believes that Monsour has brought value to the agency commensurate to his high pay.
The salary has become a bone of contention for some council members as they consider the city-parish’s budget for 2015. One major issue this budget cycle is a request for raises for the lowest-paid employees in the government.
“I’m not going to tell them I’m not going to give them pay raises so I can pay someone $300,000 a year. That’s obscene,” Councilman John Delgado said. “If they’d proven their worth, they’d be self-sustaining by now, but they are not. They are coming to taxpayers hat in hand.”
Noland said city funding is the only viable alternative for sustainability and that if the council doesn’t allocate the funds, then Monsour likely will be asked to step down in order to free up additional funds.
“Walter has said he cannot work for the kind of salary we are prepared to pay, so we are on the horns of a dilemma,” Noland said. “We will have to seriously consider parting with Walter.”
Noland said he believes the RDA is effectively proving its value to the community. He said tremendous progress has already been made at the Ardendale development, which eventually will house spaces for residences, retail, and Baton Rouge Community College and the East Baton Rouge Parish school system’s career academy. The RDA touts that it has created 761 new housing units, created 3,350 new jobs and invested $265 million in projects parishwide.
The RDA also has authority to take adjudicated properties, which are properties in government hands because taxes haven’t been paid on them, and put them back into commerce. The mechanism helps clean up blighted properties while giving the RDA a way to collect revenues from the properties.
The RDA has taken on 129 adjudicated properties, and turned the majority over to nonprofits that have restored them, many of which are vacant lots.
None of the properties generate revenue for the RDA. Only the Ardendale and Entergy properties have the potential to create a revenue stream because the RDA still owns them, Monsour said in an email.
Larry Bankston, executive director of the Baton Rouge Growth Coalition, said the RDA serves an important role in the parish, despite not yet having an opportunity to fully demonstrate the scope of its abilities.
“It’s a situation where you always hope people could do more,” he said. “But they were created in the most disastrous of economic times in our country.”
Several agencies that work with the RDA did not respond to or declined messages seeking comment for this story, including the Baton Rouge Area Foundation, the Mid City Redevelopment Alliance and the Center for Planning Excellence.
John Schneider, who has been involved with downtown redevelopment projects such as Hotel Indigo and Kress @ Third and Main, said the RDA is just diverting grants that could otherwise be used by city government’s own Office of Community Development. He said the RDA also is charging developers higher than normal premiums for work and adjudicated properties to sustain its operations budget.
“Unless there are distinguishable missions and funding sources for the RDA vis-a-vis EBR Community Development agency, we have a duplication that is not needed,” he said in an email.
Councilwoman Donna Collins-Lewis said the RDA should be credited with bringing together all the agencies that are making the transformative Ardendale development possible.
She said inner-city blight is a major issue in the parish and one that often gets overlooked by government.
“I want to make sure everyone in the city is provided for, and the RDA is vital to that,” she said.
Holden is expected to unveil his proposed city-parish budget for 2015 in early November. The Metro Council in December will vote on whether to approve it. The Metro Council can only make line-item changes to the budget with eight votes.
Councilwoman C. Denise Marcelle said she considers the RDA to be a “much-needed entity” and would like to support it but questioned where the money would come from.
Mayor Pro Tem Chandler Loupe noted that the RDA has a need for recurring money for eight years. He said it’s unrealistic to bank on the council overruling the mayor’s budget every year.
“If they’re looking for eight years of funding, this is not the mechanism to do it,” Loupe said. “You have to have the mayor’s approval. You need him to put you in the budget.”
Noland said he recognizes the challenges of their budget strategy moving forward.
“Is it a problem? Yes. Do I stay up at night worrying about this? Yes, I do,” he said. “But I’ve put 25 years into this work. And I’m the most astonished person in Baton Rouge to find myself in the position with a mayor who says: not one red cent. Not one thin dime.”