Voters this fall may decide the fate of a lawsuit over the state’s $646 million rainy day fund.
Baton Rouge attorney Kyle Keegan said a constitutional amendment on the Oct. 22 ballot may make the lawsuit he filed last year against the state moot.
The amendment aims to fix a part of the Louisiana Constitution that requires an almost-immediate repayment of money taken from the fund. The lawsuit seeks to force legislators to comply with the current state constitution instead of using a state law that grants more time to repay the fund.
“We don’t actually care how the problem gets fixed, whether the Legislature fixes the mistake themselves or the court does it for them,” Keegan said.
The problem involves when legislators must repay money they withdraw from the state’s rainy day fund.
The rainy day fund — formally called the Budget Stabilization Fund — was set up to tide the state over when revenue falls short.
Two years ago, legislators took $198 million from the fund to help balance the state operating budget.
The withdrawal sparked squabbling over when the money would have to be repaid.
The state constitution seems to require an almost-immediate repayment. A 2009 state law gives lawmakers more time in replenishing the fund by setting a high revenue benchmark that must be reached before the money has to be repaid.
A dispute arose over whether a law can be used to circumvent the state constitution.
Former state Rep. Ronald Gomez and taxpayer Robert Reid sued the state in the 19th Judicial District to contest the 2009 state law.
“The Louisiana Constitution is the supreme law of the State to which all legislative acts must yield,” they argued in the suit, which Keegan filed on their behalf.
Gomez and Reid asked state District Court Judge Kay Bates, of Baton Rouge, for a summary judgment granting an immediate ruling in their favor. A hearing on the matter was set for October.
However, the constitutional amendment on the fall ballot is delaying the court case.
The amendment would give legislators five years to repay the fund.
Senate President Joel Chaisson II, D-Destrehan, said the lawsuit did not spur him to sponsor the amendment in Senate Bill 147.
“I’ve been working on getting an amendment to the rainy day fund before the voters for three years now,” he said.
Chaisson said the fund simply does not work. “It was never envisioned to operate the way it does,” he said.
Chaisson said the current repayment requirement in the state constitution would be similar to taking out a bank loan and then being required to repay it before leaving the bank.
The amendment would not resolve the fear that the lawsuit might force legislators to immediately repay the $198 million they took from the fund two years ago. The repayment would come during tough budget times for the state.
But Keegan said he is not trying to address the wrongs of the past.
“Do it right moving forward,” he said.