State government’s Fiscal Review Committee voted this week to ask the courts to appoint administrators for two financially troubled Louisiana towns.
If the courts agree, the fiscal matters of the town of Stirlington in Ouachita Parish and the city of Bogalusa in Washington Parish will be run by administrators tasked with getting them on solid financial ground. The municipalities will cover the administrators’ costs while local elected officials can only serve as advisors.
Louisiana Legislative Auditor Daryl Purpera, who chairs the committee, urged local leaders to cooperate with their administrator, who would want to work with them but would have the authority to “push you aside” if needed.
Stirlington, a municipality of about 1,700 people, has about $21 million in debt, officials said. A typical debt for a town of that size would be more like $1.7 million, said Bradley Cryer, the Legislative Auditor’s director of local government audit services.
About $8.8 million of the debt was attributed to the creation of a sports complex that may not produce enough revenue to service its debt. Cryer said the town was unable to produce enough reliable information to conduct a proper audit.
“You inherited a mess,” said Ron Henson, first assistant state treasurer and committee member, to Caesar Valasquez, Stirlington’s new mayor. “I don’t know if you have time to do enough to correct it.”
Among other issues, Bogalusa has a $22.4 million liability for a pension system that is only 17 percent funded, Cryer said. Henson referred to the system as a “ticking time bomb.”
Voters rededicated two existing taxes to the retirement system but voted down another tax.
“They’re tax-weary and tax-leery,” Bogalusa Mayor Wendy O’Quin Perrette said of her constituents.
She said she is in the process of laying off city employees, increasing fines and fees and reducing services. The root problem, she said, is that the city was built for 25,000 residents but is currently home to less than half that number.
The town of Clinton in East Feliciana Parish was given a 30-day reprieve by the committee, which will allow for enough time to receive an engineering report describing how much it will cost to fix the town’s ailing water system. That report will allow for a better picture of the town’s financial state, committee members said.
Clinton Mayor Lori Bell currently is being prosecuted for malfeasance, accused of neglecting the town’s water system issues. It is the third time she has been arrested for allegedly misusing her office. Her attorney said Bell should not have been arrested for what he describes as a civil matter but asked her to give a statement rather than answer questions.
Bell said the issues with the water system are being addressed. She said the town has engaged the Louisiana Rural Water Association to produce a study about how much it should be charging for water, rather than the paltry $13 a month it charges currently.