A state Senate committee rejected legislation House Republicans had trumpeted in a video as the way to “fix a corrupted capital outlay process.”
The Senate Revenue and Fiscal Affairs committee Tuesday then added some projects, rearranged others and shipped the state’s construction budget to the full Senate for consideration.
In March, as part of a new social media outreach program, the House Republican Majority released a video about legislation they claimed would reform the way capital outlay is handled. Treasurer John Schroder said over swelling music that “the way we fund public projects in Louisiana is broken.” House Bill 122 sponsor Rep. Phillip DeVillier, R-Eunice, said the state needs to “get politics out of the way.”
When HB122, which easily passed the House, arrived in the Senate, the members of the committee didn’t mention the partisan video. But they grilled DeVillier about the ad's suggestions that legislators are not to be trusted and that legislative processes, such as capital outlay, are riddled with fraud and abuse.
“Maybe they don’t trust us,” Sen. Jay Luneau, D-Alexandria, said about taxpayers, “because maybe some politicians go through the process of saying we’re not to be trusted.”
He and other members of the panel argued that while not perfect, state government is managing finances better than in the past.
DeVillier agreed, praising Democratic Gov. John Bel Edwards.
“I’d like to say on record that I think the governor is doing a good job with trying to take capital outlay as it used to be spent and doing a better job,” DeVillier said. But, “I really and truthfully think this bill helps our state move in the right direction.”
The way capital outlay has been done for years is legislators fill up House Bill 2 with all sorts of construction projects. The Legislature approves the projects. Because far more projects are included than money available, the Division of Administration, whose leader is chosen by the governor, ranks the proposals for the state Bond Commission, which acquires the loans necessary. The rest of the legislatively approved projects receive no money and no authority to sell bonds for funding.
With little discussion the Louisiana House authorized borrowing close to $700 million to continue work on dozens of state projects from drinki…
HB122 would put more money towards roads and bridges, add a step to the process by having legislators give final approval of the list of projects going before the Bond Commission, and requiring local governments to put up a sizable portion of matching dollars for their projects.
“It’s a bad policy for us to give state dollars to non-state projects,” DeVillier said. Once the local project is complete, the state doesn’t own the assets.
Democratic Sen. Troy Carter, who once was a member of the New Orleans City Council, pointed out that the projects sought by local governments — drinking water infrastructure, for instance — benefit the state. Many communities, particularly in rural areas, have no money to put up and they would have to forego new construction for infrastructure, building repairs and other efforts.
“We’re further bogging down the process by adding more bureaucracy and politics. I’m not sure that fits in with your notion of transparency and reform,” Carter said before moving to reject the legislation. None of the committee members, including the Republican senators, objected.
Revenue and Fiscal Affairs Chairman JP Morrell, D-New Orleans, then took up the state construction budget, making 32 pages of changes, adding about $242 million. The legislation was approved without debate or objection and now faces a vote by the entire Senate. The House then would be asked to approve the changes made in the Senate.
Upon arrival in the Senate, House Bill 2 had authorized $631 million for the highest priority projects. The Senate panel shifted about $23 million more, a total now of $653 million, into that category likely to get bond money in the fiscal years beginning July 1.
The state can sell about $315 million in bonds to fund projects. That limit is expected to increase to about $435 million in April.
The category that provides funding for those priority projects in future years now is about $1.2 billion in obligations. The new projects that will receive money if all the highest priority dollars are used is now valued at $130.4 million.
The total value of the bill is about $3.4 billion.
“It’s over appropriated, as always,” Morrell said.