The State Bond Commission barred two of the largest banks in the world from participating in efforts to fund some highway projects in Louisiana because of firearms policies instituted after recent mass shootings.
On 7-6 vote, the commission excluded Citigroup Inc., the nation’s third largest bank, and Bank of America Merrill Lynch, the second largest, from participating in a $600 million plan to widen Interstate 10 in Baton Rouge and improve access into the Louis Armstrong New Orleans International Airport, along with a project in Shreveport.
State Treasurer John Schroder made the motion saying the banks’ restrictions infringed on Louisiana residents’ constitutional right to buy guns. “As treasurer and chairman of the Bond Commission it is one of my duties to help hire financial professionals and not necessarily social engineers,” he said.
Bank of America handles 18 percent of the state’s general obligation bonds and Citibank administers another 5 percent. Schroder said after the meeting that he doesn’t plan on disrupting those existing relationships but would bring the issue up when those contracts expire.
A few weeks after a gunman killed 17 people at Parkland, Florida’s Marjory Stoneman Douglas High School on Feb. 14, Citigroup announced it would no longer do business with retailers peddling high capacity magazines or selling guns to anyone who hasn’t passed a background check; or is under the age of 21, except those who have passed firearm hunter safety courses or are involved in the military or law enforcement.
Anger over gun policies adopted by two of the world’s largest banks after recent mass shootings threatened funding for highway projects in Bat…
In April, Bank of America stopped lending money to gun manufacturers that make military-like firearms for civilian use, such as the AR-15-style rifles.
The actions by the privately owned banks enraged some Republicans, including Louisiana U.S. Sen. John N. Kennedy, of Madisonville, who said the institutions should focus on their businesses and not gun control.
Louisiana’s Bond Commission is likely the first official government agency in the country to exclude banks because of firearm policies.
“It puts us in an awkward position,” Senate President John Alario, R-Westwego and a member of the Bond Commission, said of the vote.
Excluding Bank of America and Citibank from the process because of a social policy could open the state to being sued. “I am worried about the bottom line to the state of Louisiana, too. True conservatives worry about the dollars,” he said.
Renee Boicourt, the commission’s financial advisor, said prohibiting the two banks that control a third of the nation’s government bond market would cost state taxpayers more money. She also noted that only Chicago considered tying gun control policy to bonds, but city officials backed off upon realizing the move would make bonds more expensive.
“You can’t put a price tag on the Second Amendment,” state Rep. Blake Miguez, an Erath Republican who was serving as a proxy Representative of the House.
Miguez said the Louisiana Bond Commission should not be doing business with Citibank and Bank of America because their policies improperly restrict the availability of certain styles of weapons used in mass shootings.
“I know you’re from New York,” Miguez told Brandee McHale, the head of Corporate Citizenship at Citigroup Inc., who had come to Baton Rouge to testify about the financial giant’s gun policy. “This is Louisiana. This is not California. This is not Canada. … This is an infringement on 2nd amendment Constitutional rights in Louisiana.”
“We don’t believe we are standing in the way and infringing upon 2nd amendment rights,” McHale countered, adding that Citigroup has very few, if any, small business clients in Louisiana that sell guns. For the most part the bank does business with large, multi-state retailers, most of whom adopted similar gun sales policies on their own.
Individual consumers still can use their Citibank credit card to buy firearms, she said.
“The ability of the merchant to sell the item is being restricted by you,” Attorney General Jeff Landry said, pointing at executives from the two institutions.
The Bond Commission has the authority to decide if the state should hire an agent that believes in restricting the citizens right to bear arms. “We’re basically trying to evaluate underwriters," Landry said
Landry and Kennedy are frequently named as possible GOP challengers to Democratic Gov. John Bel Edwards’ 2019 reelection.
Edwards’ legal advisor, Matthew Block, opposed the motion to exclude the banks arguing that state and federal constitutions restrict government actions, such as infringing on the 2nd amendment right to bear arms. The commission’s decision was aimed at punishing a private company’s decision.
House Speaker Taylor Barras, a Republican who is a banker in New Iberia and a member of the Bond Commission, said after the meeting that bond prices are set by the market. “This was deciding who we would pay a fee to be a senior advisor,” Barras said. “As we evaluate bidders, it’s within our jurisdiction to ask those questions.”
Senate Finance Committee Chairman Eric LaFleur, D-Ville Platte and bond attorney who is a member of the commission, said the panel’s duties are narrowly defined in law as determining whether bids follow the law and maximizing on savings.
“We don’t have this much discretion,” LaFleur said.
Bond Commission staff has 16 remaining bids to grade.
How they voted
To block Citibank and Bank of America over gun policies: Interim Secretary of State Kyle Ardoin, Attorney General Jeff Landry, House Speaker Taylor Barras, State Treasurer John Schroder and State Reps. Blake Miguez, Mike Huval and Phillip Devillier.
Against blocking: Governor legal counsel Matthew Block, Senate President John Alario, Division of Administration counsel Rick McGimsey and State Sens. Eric LaFleur, Jay Luneau and John Smith.
Absent and not voting: Lt. Gov. Billy Nungesser.