President's Report-October 17, 2023
UPDATE ON BROADBAND EXPANSION PROJECTS-ITEM 1 OF THE ADMINISTRATIVE/FINANCE AGENDA
In August of 2022, I reported that Cajun Broadband applied for Round 1-A funding from the Office of Broadband Development and Connectivity under the Granting Unserved Municipalities Broadband Opportunities Act (“GUMBO”) for the installation of fiber in the Poche Bridge/Cecilia areas. Although Cajun was advised several months ago that the award was granted, the actual funding documents have only been recently received. An overview of the project, as verified by Cajun Broadband by e-mail dated October 10, 2023, reflects that the project will cover Cecilia, continue down La. Highway 31 through the Poche Bridge area, concluding west of Breaux Bridge on La. Highway 94. As you will recall, for this application, I committed $400,000.00, and that amount has been budgeted from our ARPA funds.
It is anticipated that over 500 homes and businesses will be subject to broadband services by this project which is expected to be completed around April of 2024. The base speed to be provided is 100MPS/100MPS, downloads/upload. The services will support scalability speeds of 1,000MPS/1,000MPS, download/upload.
I have commissioned the preparation of a Cooperative Endeavor Agreement to solidify the terms and conditions of Cajun’s obligations which must be executed prior to our contributing our commitment. The CEA will be in all material respects identical to our previous accord with Cajun Broadband. I will ask for a Resolution approving the CEA at the November Council meeting.
A second Round 1-A application of Cajun includes proceeding from where the above mention area ends to the Portage area near Arnaudville. I committed $290,000 for this application.
I reaffirm that the entirety of the Parish commitments are within the budget set for use of the ARPA funds.
I remain optimistic about the direction we are heading in our efforts to introduce high speed internet services to our rural communities. I truly believe that our March 22, 2022 CEA with Cajun Broadband sent a strong message that we are committed to providing broadband services in St. Martin Parish; hence, enhancing the GUMBO scoring for the Parish and its providers who have partnered with us. I will keep you posted on developments in this matter, especially as regards other Round 1-A awards including those in favor of Allen's Communications about which I have previously reported.
APPROVAL OF ARCHITECTUAL CONTRACT WITH PARISH ARCHITECTURE, LLC
At the November Council meeting, I will seek a Resolution authorizing a contract with David Robichaux with Parish Architecture, LLC to address much needed repairs to the roofing system at the Courthouse. Last April, I advised that those repairs include the roof, roof drainage, moisture protection, and exterior finishes. All gutters, flashing and downspouts serving the upper and lower older eaves and gables are either cooper or terne coated cooper. Caulking has been improperly applied at the seams of the gutters where soldering should have been used. In many instances, the transition flashing between roofs and rake edges is bent, creating an unreliable drainage condition. The cornice corners are separating at their seams. Specifically, the upper cornice corner overlaps copper gutter systems along the drip edges, and gable edges are in a deteriorating condition. The locations where they intersect with the copper gutters, in most instances, seem to be the source of these problems. Mr. Robichaux has opined that several factors further contribute to the deterioration:
- The downspouts are not seamed correctly;
- The fascia cleat for the gutter turns inwards into the gutter, pushing water back inside and behind the gutter liner. Thus, a multiple of consequential problems develop including, but not limited to decay and damage to wood soffit and trim.
Finally, the low slope modified bitumen roof lacks sufficient granular material and roof tiles are broken in several locations.
The current estimated cost to address the roofing issues alone is estimated at $271,845.15. As regards correcting the exterior moisture problems, the cost is projected to be $260,477.36. Moreover, once the roofing work commences, additional problems may likely be exposed driving the remediation costs even higher. We have budgeted over $800,000 for 2024 for these repairs and other matters which may arise.
Thus, we are now in a position to commence the preparation of the plans and specifications so that the roofing repairs can be bid. On October 16, 2023, I will be meeting with Mr. Robicheaux for a timetable for this project which will include planning (preparation of specifications, etc.), bidding, and construction schedules. Finally, I note that Parish Architecture, LLC specializes in roofing systems such as that on the Parish Courthouse.
As an aside, the total Courthouse maintenance for 2024 is budgeted at $1.2 million for FY 2024.
ITEP CONTRACT NO. 20170492-B-ITE WITH LASUCA
You will recall that on April 4, 2023, the Council adopted Resolution Number 23-0025-RS approving of amendments to the Industrial Tax Exemption Program contracts between the Louisiana Department of Economic Development and the Louisiana Sugar Cane Cooperative, Inc. The background related to that action is best summarized by the following excerpts from my report of March 2023:
“This item of the agenda addresses ITEP issues associated with applications for tax exemptions previously awarded to the Louisiana Sugar Cane Cooperative, Inc. (“LASUCA). As alluded to in the prior section of this report, LASUCA was granted an 80% exemption of ad valorem taxes over the last several years, all sponsored through the Louisiana Industrial Tax Exemption Program [“ITEP”]. A condition of the exemptions granted under contract numbers 20170492-ITE, 20170492-A-ITE, and 20170492-B-ITE was the creation of specific jobs at a stated total annual payroll.
Louisiana Sugar Cane Cooperative Inc is now requesting that the Parish, School Board, and Sheriff support its request to the Louisiana Board of Commerce and Industry to correct various administrative errors that were made during the preparation and filing of the attendant Cooperative Endeavor Agreements for the various project phases embraced by the aforesaid contract numbers. Specifically, LASUCA is requesting that the “support” come in the form of a “resolution of support” (or a letter in the case of the Sheriff). The specific requested amendments are of Exhibit A of each CEA for 20170492-ITE, 20170492-A-ITE, and 20170492-B-ITE in the following particulars:
#20170492-ITE - Create 20 new jobs with $1,253,973 in payroll (these are the new jobs and wages created by the expansion project minus the H2B wages which are not acknowledged by the state economic development office);
#20170492-A - Retain 89 jobs with $6,626,028 in payroll (this is the portion of new jobs which had been created during the first phase as well as the existing 70 jobs which were in place before the project started); and
#20170492-B -Retain 90 jobs with 6,644,542 in payroll (These are the full 20 new jobs created by the project as well as the 70 existing jobs and the associated payroll).
The questions which have led to the need to amend the CEA arise from the fact that LASUCA included in its calculation of job creation obligations what is referred to as “H2B” employees. These are legal immigrants who work in the United States pursuant to lawfully issued visas. The Board of Commerce and Industry have does not include such employees in its application of the term “job creation”. This interpretation/application of its “rules” has been subject to debate. Nonetheless, to prevent any misunderstanding or future issues, LASUCA now desires to remedy the conflict by revisions to its previous CEA’s.
My office only recently received from the Board of Commerce and Industry a formal Notice of Non-Compliance for #20170492-ITE because the payroll requirement for the “new” jobs created was $1,650,000; however, the annual payroll actually met was $1,253,973. A Notice of Non-Compliance was concurrently received for #20170492-A because the original CEA provided for the creation of 6 new jobs with a payroll annually of $222,850; however, the Board advises that no new jobs were in fact created.
After meeting with LASUCA representatives and their attorney on March 14, 2023, together with Jennifer Stelly of SMEDA, Sheriff Breaux, and School Board finance personnel, an argument can certainly be made that LASUCA’s position seeking these revisions of the subject CEA’s is tenable. Nonetheless, as regards the requested amendments, the Council may adopt one of three courses of actions:
- Defer all decisions to the Board of Commerce and Industry; or
- Agree to the amendments to the CEA, thus ameliorating the basis for the Notices of Non-Compliance; or
- Agree upon a default payment in an agreed upon amount.
Any decision must be made and provided to the Board of Commerce and Industry no later than May 15, 2023.”
Resolution Number 23-0025-RS is applicable solely on a prospective basis and does not apply retroactively. Indeed, the Council was informed last March that additional remedial action may be necessary for the year 2022. Thus, and as expected, on September 21, 2023, I received from the Board of Commerce and Industry a formal Notice of Non-Compliance for Contract #20170492-ITE for the year 2022. The basis of the alleged violation was that the payroll requirement for the “new” jobs’ creation was $7,671,336.00 (representing 116 jobs); however, the annual payroll actually was $6,401,668.00 (representing 106 jobs).
Thus, it will be necessary, as predicted last March, that the Council adopt another Resolution, specific to the year 2022, acknowledging the action last April which recommends that no remedial action be taken against LASUCA by the Louisiana Board of Commerce and Industry and/or the Louisiana Department of Economic Development. Noteworthy is that the School Board and Sheriff’s Office have taken such action. Also, out of an abundance of caution, I will request that representatives of LASUCA be present to again address the Council on this matter.
ITEM 3 OF THE PUBLIC WORKS AGENDA-CANAL REDUCUTION REQUEST-ORDINANCE SUMMARY NUMBER 1410-OR
Item 3 of the Public Works Agenda is another request for a reduction of the limits of a servitude established by virtue of La. R.S. 38:113. Ordinance Summary No. 1410-OR was introduced at the regular meeting of October 3, 2023, and is scheduled to be voted on at the November regular meeting.
The property in question is located at 1231 Capritto Forty Arpent Road and is owned by River Rental Tools. The company is seeking to expand its operations which will include the construction/expansion of its current facilities such that there will be an impingement on the one-hundred-foot servitude area. Indeed, a slab was already poured which is forty-eight feet from the canal bed. According to the contractor for the project, either the surveyor or title examiner did not impart the correct information relative to the limits of the Parish’s servitude.
In any regard, Public Works personnel, inclusive of our Director, inspected the site and determined that forty-eight feet would be sufficient to provide the necessary access to the canal for maintenance. Moreover, in discussions with the contractor, it was made clear that the reduced area must be free of any structures, fencing, or other encroachments inclusive of trees and other foliage`. The canal in question is identified as “L-1H-5A.”
I have suggested that the owner and/or contractor be present at the meeting to answer any questions which this request may generate. Also, although I doubt that such is necessary, I nonetheless provide the following regarding R.S. 38:113 which was set forth in my August report:
“I remind you that La. R.S. 38:113 grants unto parish drainage districts control of canals specifically selected as part of a parish-wide drainage system. The limits of the servitude are one hundred feet on both sides of the bed of the selected lateral. By Resolution adopted by the Parish on February 27, 1973, 348 laterals were designated as forming part of the St. Martin Parish drainage system. Moreover, in past reports, I have noted for your edification that:
‘There are two salient aspects associated with such a statutorily created servitude. First, the Parish may reduce the limits of any such servitude at its discretion and on a case-by-case basis. However, any such reduction must be by Ordinance under the dictates of Section 2-11 of the Home Rule Charter. Second, despite the servitude rights afforded by the statute, any damage to the personal property of a landowner occasioned by the activities of the Parish in exercising its servitude rights is subject to compensation from the Parish. Two court decisions which discuss this principle involve St. Martin Parish: Dugas v. St. Martin Parish Police Jury, 351 So.2d 271 (LA. App. 3 Cir. 1977) Berard v. St. Martin Parish Government, 13-114 (La. App. 3 Cir. 6/5/13), 115 So.3d 761. Candidly, these decisions in my view improvidently and unreasonably extended the obligations and rights legislatively afforded local governing authorities.
As a consequence of this judicially recognized and enforced principle, there are numerous practical problems which have developed in exercising the maintenance rights and obligations associated with these “38:113” servitudes. These problems include:
- Cases where property owners have planted trees and/or constructed buildings, fences, and similar structures within the servitudes;
- The development of subdivisions with homes, outbuildings, fences, and other structures within the servitude;
- Laterals which run through municipalities whether as a product of annexation or otherwise; and,
Therefore, frequently in such instances the Parish cannot access the bed of a lateral for cleaning, enlargement, and/or related maintenance endeavors because of encroachments such as buildings, fences, or trees having been placed within the limits of the servitude. To do so would result is substantial consequential damage to such property which in turn would expose to Parish to monetary liability in accordance with the legal principles enunciated in the jurisprudence.’”
Finally, I feel constrained to reference Resolution Number 23-080-RS which the Council adopted on October 3, 2023. That edict identifies pertinent factors to consider when vetting requests for reductions of the servitude limits established by La. R.S. 38:113.
HENDERSON CONTROL STRUCTURE
I have previously mentioned that the Henderson Control Structure needs to be rehabilitated. The hydraulic system which regulates the opening and closing of the control gates frequently needs repairs and the control house long ago started “showing its age.” Furthermore, on the southwest (levee) side of the structure, the banks are reflecting severe erosion which must be addressed. Of course, the issue, as with most infrastructure, boils down to costs.
Consequently, over the last several months, working in concert with our hazard mitigation consultants, we have evaluated alternative funding sources to address the foregoing. Recently, I thought about using the balance from the 2019 bond sale for the replacement of the Pontoon Bridge. It appears that we may have over a million dollars left after payment of all costs attendant to the bridge replacement.
The Department of the U.S. Treasury must approve the use of GOMESA funds, and any use thereof which must have a nexus to coastal projects. Since we were successful in obtaining Treasury approval for the bridge replacement, I strongly believe we can legitimately use the balance of the bonds to address the Henderson Control Structure problems. In the next few weeks, I will further explore this avenue with our bond counsel and/or our RESTORE Act/GOMESA consultants.
FEMA IMPLEMENTATION OF IMMEDIATE NEEDS FUNDING
Last month, I reported that:
“…FEMA recently announced that its Disaster Relief Fund (DRF) is approaching exhaustion. Hence, given the current disaster environment, FEMA has deemed it necessary to implement what is referred to as “Immediate Needs Funding (INF)” guidance to govern payments from the remaining balance of the DRF. The decision was effective “immediately” because the current disaster landscape, defined by major fires, droughts, and multiple hurricanes, mandated that FEMA initiate INF. FEMA asserts that such action will allow it to continue its focus on response and urgent recovery efforts without interruption.
INF is intended to meet the urgent needs of disaster survivors and will prioritize funding for lifesaving, life-sustaining, and critical disaster activities. There have been a number of times in the past where the Agency found it necessary to issue INF, as a precautionary measure, to maintain an adequate DRF balance while awaiting passage of appropriations legislation.
When INF is implemented, funding will continue for Individual Assistance and Public Assistance only when essential for lifesaving and life-sustaining activities, state management costs, mission assignments and critical ongoing disaster operations.
Under INF, there will not be new obligations for Public Assistance not essential for lifesaving and life-sustaining activities, permanent work and the Hazard Mitigation Grant Program. Obligations for these activities will be paused until the DRF is sufficiently funded. However, FEMA will continue to accept and process Public Assistance and Hazard Mitigation grant applications even in categories where the obligations are paused.
What this means for St. Martin Parish is that until the DRF is replenished, Public Assistance will not be available for debris clean-up, mosquito control, or repairs to nonessential infrastructure. Hopefully, Congress will act expeditiously to appropriate full funding of the DRF.”
Shortly after the submission of the foregoing, Congress provided FEMA with funding. This is particularly important because FEMA is now expected to reinstate its Home Elevation Program which was suspended because of the INF declaration. I will keep you informed when the application period for the program is announced.
HAZARD MITIGATION ADMINISTRATION
The bulk of the Parish’s hazard mitigation program has heretofore been handled by Gary O’Neal through the firm of C.H. Fenstermaker & Associates. Unfortunately, Mr. O’Neal has announced that he is leaving Fenstermaker to assume a position with a national firm. I have conferred with Fenstermaker to ensure that our mitigation projects which have been assumed by them remain on track. THIS INCLUDES THE HOME ELEVATION PROGRAM. Indeed, I have been assured that the hazard mitigation section of Fenstermaker will remain intact even if it will be necessary for the firm to subcontract such services.
REGION III MEETING
I remind the Council again that this year St. Martin Parish is scheduled to host the Region III meeting of the Police Jury Association of Louisiana. This is one of the responsibilities imposed as a consequence of my serving as the 2023 President of Region III. The meeting is scheduled for October 19, 2023, commencing at 6:00 P.M. at the Cecilia Civic Center. The agenda is currently being prepared through joint efforts of my office and that of the Council Clerk. Moreover, contributions have been received and no costs will have to be incurred by the Parish.
Brooke Thibodeaux, Clerk of the Council, and Lesley Thibodeaux, my Executive Secretary, are to be commended for their efforts in the planning, organizing, and soliciting of private contributions for this event. The planning of this affair has been both taxing and time consuming. I cannot thank enough for their efforts and commitment to making this event a success.
HAZARDOUS WASTE DAY
Once again, I remind everyone that the Parish’s hazardous waste day is OCTOBER 21, 2023, from 8:00 a.m. to noon. The event will again be conducted at Parc Hardy in Breaux Bridge. This site proved convenient last year and helped greatly in traffic control especially, though not exclusively, as regard ingress and egress of the premises.
As customary, we will accommodate only St. Martin Parish residents. The items that will be collected include:
- Alkaline Batteries
- Lithium Batteries
- Auto Batteries
- Electronics (computers, printers, cell phones, etc.)
- Aerosol products
- Latex and Oil Based Paint
- Poison Liquids
- Poison Solids
- Motor Oil
- Fire Extinguishers
- Fluorescent Bulbs
- Mercury Thermometers
- Propane Tanks
A comprehensive list of items collected and those which will NOT be collected will be particularly described on the promotional literature to be prepared in the coming weeks and disseminated on social media posting and to the public by traditional methods and media. It will be similar to the one used last year, and replicas will be distributed to you personally upon final publication.
Also, the Library Board for the Parish will again provide equipment for the shredding of documents and other paper materials.
The City of Breaux Bridge is likewise assisting the Parish in this endeavor as was the case with the last year’s hazardous collection event. Also, the Parish’s OEP is participating in the event with the Parish.
The Parish’s tax collection reports for September 2023 represents a decline in collections for the second consecutive month. Of interest, according to my comparison of the recent collections with those from prior years, is that the September net collections are generally less than those in August. Nonetheless, in accord with my past monthly reports, I have prepared and hereby submit the following summary of the most recent monthly tax collections:Net Collections for Sales Tax District #1:
September 2023 Net Collections: $330,870.51
September 2022 Net Collections: $409,938.55
September 2021 Net Collections: $296,438.12
September 2020 Net Collections: $259,591.50
Average 2022 Monthly Collections: $344,955.41
Average 2021 Monthly Collections: $309,495.52
Average 2020 Monthly Collections: $251,006.17
Average January-September Net Collections:
Sales Tax District #1
January-September 2023 Average: $356,326.37
January-September 2022 Average: $345,663.52
January-September 2021 Average: $306,937.85
January-September 2020 Average: $246,298.33
Sales Tax District #2:
September 2023 Net Collections: $144,514.28
September 2022 Net Collections: $134,315.81
September 2021 Net Collections: $97,529.29
September 2020 Net Collections: $152,940.57
Average 2022 Monthly Collections: $140,560.01
Average 2021 Monthly Collections: $112,363.68
Average 2020 Monthly Collections: $95,507.00
Average January-September Net Collections
Sales Tax District #2
January-September 2023 Average: $155,687.06
January-September 2022 Average: $132,756.95
January-September 2021 Average: $104,118.99
January-September 2020 Average: $97,940.65
Sales Tax District No. 1:
The September monthly net collections for this year are substantially greater that the September net collections for the last several years except for September of 2022. Despite the slight decrease in the last two months’ collections, the average amount collected for the first nine months of this year exceeds the average collections for the past several years. Similarly, the average net collections for January -September of this year ($356,326.37) exceed the average collections for the same time period over the last ten (10) years. Hence, the average for this year is not the product of one or more strong months of collections. At this point, the drop in monthly collections in August and September is not overly concerning. The overall trend is not only upward, but, more importantly, appears to be on par with current inflationary rates.
Sales Tax District No. 2:
The September net collections for 2023 are greater than any September net collections over the last decade with the exception of September 2020. The average monthly net collections for the first nine months of this year are in excess of the average collected for the same 9-month period over the last several years. Likewise, the average collections thus far in 2023 are greater than the average collections for the entire 12 months of the years 2020 through 2022.
In Sales Tax District #1, the average monthly collections for the first nine months this year are $10,662.85 greater than the amount collected in the same time period in 2022. This computes to a 3.08% increase. In Sales Tax District #2, the average collections for January-September 2023 are $22,930.11 more that the amount collected for those months in 2022. This is reflective of an 17.27% increase. As succinctly alluded to previously, the most encouraging aspect is that the collections increases are above the inflationary rates for the last year as reported by most publications which I have reviewed.
With inflation, sales tax collections are expected to rise, and to accurately gauge the net impact of increased collections, one must compare increases in tax collections to the current inflationary rates. Increases at or below the inflationary rate should be troublesome. Consequently, the increases in Sales Tax District No. 1 of 3.08% compared to an inflationary rate at 3.7 to 5% over last year are right at the inflationary rate. More importantly, the increase of 17.27% in collections in Sales Tax District No. 2 is extraordinary when measured against the inflationary rate.
Hotel/Motel Tax Collections:
The hotel/motel tax collections for September 2023 were $42,819.55 compared to September 2022 collections of $21,906.03 and 2021 September collections of $19,232.31. The average monthly collections for the entire 12 months of 2022 were $25,297.62 and were $26,404.71 in 2021. The 2023 average monthly collection up to October first is $37,333.43. This computes to a 10.68% increase above the total collections for the entire year of 2022.
Furthermore, I note that the September 2023 collections are less than the collections in July and August of this year. This decline is consistent to what we see relative to the collections in Sales Tax District # 1. Nonetheless, as with the sales tax collections, the total increases for the year are indicative of positive activity especially when the rate of inflation is considered.
Based upon the foregoing, I am AGAIN constrained to repeat these remarks from my last reports regarding vigorous efforts which have been made to collect these taxes:
“Noteworthy is that there have been more aggressive efforts to insure that the Air BNB’s in the Parish are collecting the required hotel/motel taxes, as required. Recently, it was discovered that many Air BNB were, inexplicably neglecting to collect and/or remit the required assessments. Hence, I credit those efforts.
Last month, I observed that sales tax collections can be expected to greater than in years past because of inflationary factors coupled with remote sales. Nonetheless, an examination of the increase in our hotel/motel collections requires one to surmise that there are obviously increased economic activities in our Parish.”
Video Poker/Off Track Betting:
Each year, Video Poker and Off-Track Betting revenue receipts are very sporadic from June to October because of the state’s fiscal year which ends on June 30th. While no collections were reported for August, we did receive video poker revenue of $94,668.57 in September.
To date, the Parish has received $1,668,319.96 in video poker revenue. This computes to a monthly average of $185,368.88. In 2022, the Parish’s collections totaled $2,181,723.16 for the entire year, which computes to a monthly average of $181,810.26. In 2021, the total collections for that year were $2,063,827.88 for a monthly average of $171,985.65. If these collections remain on current track, then we can expect significant increases for the final quarter of the year. The collections up to this point certainly buttresses the proposition that there is more economic activity in our Parish.
There have no Off-Track Betting Revenues received as of the date of this report. This is not unusual for this time of year.
Despite the overall positive picture relative to our collections, I again observe that the economic landscape of our state and nation still remains extremely uncertain. Sean Hundley, Director of Finance, and I will continue to closely scrutinize our revenue sources and keep you abreast of all developments. Similarly, our expenditures shall remain a focal point as we administer the Parish’s finances.