The L’Auberge Casino and Hotel asked Tuesday to be annexed into the city of Baton Rouge, a move being described as a “tremendous victory” for Baton Rouge officials in their ongoing effort to stifle the proposed city of St. George.
The proposed annexation is the most recent in a series of high-profile land acquisitions by the city of Baton Rouge, including the Mall of Louisiana, which shrinks both the footprint and revenue stream for the potential new city.
The casino’s annexation would mean a loss of nearly 10 percent of the revenues the organizers of the new city were counting on in their proposed $80.8 million budget.
Baton Rouge attorney Mary Olive Pierson, who has been assisting city officials with annexation issues, said she thinks securing the casino is a devastating blow to St. George’s prospects.
“I think we had already put the nail in the coffin (for St. George) with those other annexations,” Pierson said. “Now, the coffin has been dropped in the ground and they’re starting to throw dirt on it.”
Pierson said she personally met with casino officials in Missouri to persuade them to join the city of Baton Rouge. The casino was not offered any incentives or tax breaks and will, in fact, pay higher property taxes than it currently does because of the Capital Area Transit System tax that applies to the city of Baton Rouge, Pierson said.
“It’s the devil you know, versus the devil you don’t,” she said. “We can tell you within a penny what you’re going to pay in taxes, but in St. George, you have no idea what your taxes are going to be.”
The city of St. George’s budget, like East Baton Rouge parish, is heavily dependent upon revenues generated by the businesses within its boundaries. Baton Rouge officials have decried the St. George incorporation effort, because the new city would use money that otherwise would flow into the parish coffers. The casino, along with the Mall of Louisiana, has been in the crosshairs of both competing governments because they are considered important revenue generators.
St. George officials proposed an $80.8 million budget, which included $7 million in gaming taxes from L’Auberge.
Baton Rouge officials argued the gaming taxes belonged to the city of Baton Rouge because of a signed contract, but the funds were expected to be an issue of contention. If L’Auberge is annexed into Baton Rouge, it would effectively prevent St. George from having access to that revenue.
Lionel Rainey, a St. George spokesman, said the loss of L’Auberge would not significantly affect the city’s proposed finances, because the budget included an ample surplus that can absorb the loss.
“This is not a surprise,” Rainey said. “We support their right under the law to request to be annexed into the city of Baton Rouge, just like we hope the city of Baton Rouge will support the rights of people who live in the southern part of the parish to vote on a new city after we turn in the signatures.”
The proposed boundaries of St. George encompass about 80 square miles and 100,000 residents in the southern part of East Baton Rouge parish.
For the past year and a half, organizers have been gathering signatures from registered voters in the area on a petition to put the city proposal to a vote. Only residents in the boundaries of St. George will be permitted to vote.
Organizers say they already have more than 18,000 signatures, which is greater than the minimum number of 17,746 required to get on the ballot. But they say they want more time to collect additional signatures as insurance and are looking at trying to get the proposal on the ballot in the spring.
A L’Auberge casino representative said in a statement that the decision ensures a stable business environment.
“We have always enjoyed a great relationship with Mayor Kip Holden and the Metro City Council, and this petition for annexation gives us an opportunity to further that partnership,” said Mickey Parenton, senior vice president and general manager.
He added, “Baton Rouge has been a stable business market in which to operate, and we believe this decision creates an environment even more conducive to business growth and prosperity.”
Rainey said St. George’s “economic forecast is sound,” and no financial experts have come forward to say that the city could not financially stand on its own.
The proposed city’s initial budget assumed it would return $17.7 million to the city-parish budget for parishwide offices that include family court, juvenile court, the District Attorney’s office, the Registrar and the Coroner. Rainey said those funds, which St. George organizers regard as a good faith measure on their part, could be retained by the new city if Baton Rouge continues to chip away at their expected revenue streams.
St. George’s budget also suffered another major blow earlier this year when Baton Rouge annexed the Mall of Louisiana,which is being legally challenged. Baton Rouge has also annexed Celtic Studios, Costco, Our Lady of the Lake Regional Medical Center and a handful of vacant parcels of land in the southwest part of the parish.
In total, more than 5-square-miles has been carved out of the St. George boundaries by annexations.
The city of Baton Rouge can only annex land directly adjacent to the city boundary, and only if the individual property owner or a majority of property owners in a given area choose to be annexed.
L’Auberge is petitioning along with a group of other land owners that together make up about 1,190 acres.
The other petitioners, which include Sugarcane Property LLC, Ascension Ready Mix, University PUD and Yendalg LLC, create a connection from the city of Baton Rouge boundary south of Ben Hur Road, along Nicholson Drive, down to the southern border of the parish.
The Metro Council is expected to vote on whether to approve the annexation later this month.