The other day we told you about a 7.5% tax increase that the councils would decide about on September 1st, 2020. The reason for this increase is to account for commercial property values substantially decreasing this year. This is especially thanks to the governor demanding that businesses shut down “for their own protection.” Forcing businesses to shut down caused a reduction in commerce. Less commerce effetely lowers demand, which businesses respond to by reducing their inventories. Lower inventories means lower taxes on businesses.
A loophole in Louisiana’s state constitution, Article VII, Section 23 (A), says when property valuations drops like this, the government taxing authorities may increase the rate of taxation so that they collect the same amount of money they did the previous year. That means you have to cut your budget to pay a higher percentage of your property’s value in taxes so that the government doesn’t have to cut its budget.
This is all caused by the tax assessor
Conrad Comeaux has been making the rounds, encouraging the local taxing authorities to raise taxes to the highest level allowed by law. In fact, this isn’t new. He’s been doing it for years even when property values go up.
This year, property values only went down for businesses. Residential was “flat” according to the assessor, but some home values went way up last year. That happened because of the new constitutional amendment, forcing the government to phase-in major value increases over four years. Last year was the deadline before the new law kicked in, so hundreds of homeowners saw major increases. This year, the assessor is sticking it to the residential property owners again. As a reminder, it is these residential property owners who elected Mr. Comeaux – businesses don’t get a vote.
There’s not really a deadline for the assessments
Although, traditionally, assessments may be reviewed between August 1 and September 15th, according to the Louisiana Tax Commission and the Louisiana Legislative Auditor, the assessor has no real deadline to submit assessments so that taxes may be levied. However, the assessor does have the power to waive the council’s June 1st deadline, listed in RS 47:1705(A) and RS 11:1481(1)(а)(iii)(аа).
There is a significant difference in urgency between the various parishes, too. For example, this year in St. Martin Parish, assessor R. Todd Dugas had turned in his assessments by May 13th. However, Lafayette’s Conrad Comeaux waited until August 6th! Remember, LCG’s budget hearings began on exactly the same day, making it impossible for the parish to plan accurately. Then, the council had to introduce levying of the assessor’s property tax millages in less than two weeks: on the 18th.
Also, had the assessments been completed in April or May (like in other parishes) the impact from John Bel Edwards COVID shutdown would not have materialized to the degree it had by August. At the onset, JBE wanted to “flatten the curve” for a few weeks. That didn’t impact valuations. However, five months later, business was damaged and so were related valuations. Waiting so long allowed valuations to drop considerably, and therefore the recommended increased levy amount of each tax.
A “Read My Lips” moment?
The assessor’s motivations in delaying the official assessment announcement until the first day of LCG’s budget hearings is not clear. However, it may be good to remember that Josh Guillory made a strong campaign promise to not raise taxes. It’s also worth mentioning that Mr. Comeaux financially opposed Mr. Guillory’s candidacy for Mayor-President.
We can see this evidence in several campaign finance reports. He contributed a nominal $110 to the campaign of Carlee Alm on September 12, 2019 (page 11 of report #83723, filed November 12, 2019). However, he also contributed sizably to the anti-guillory PAC, Lafayette First PAC. On page two and three (2-3) of the Special 48-hour report as well as page four (4) of the PAC’s annual report shows that Mr. Comeaux contributed $3,500. That organization spent $30,279.22 on negative campaign ads against Mr. Guillory, representing more than ten-percent of all expenditures.
Could waiting so long to release assessments have rushed the budget process? Was this an attempt to force Mr. Guillory to abandon a campaign promise to not raise taxes? After all, Bill Clinton’s victory over George H. W. Bush has often been attributed to Bush’s line, “read my lips: no new taxes.”
COVID and the tax assessment deadlines
At the September 1 meeting, in the face of 77 people calling in opposition and ZERO calling to support the tax increases, the City Council unanimously decided to reduce your taxes back down to where they were last year. However, Kevin Naquin, Bryan Tabor, and AB Rubin of the parish council voted to raise your taxes anyway! Since then, many people have been calling the Mayor-President’s office to encourage him to veto the taxes. And, it worked!
Josh Guillory’s complete VETO of both tax increases!
The first veto of the airport tax increase happened late Friday afternoon. This can probably be attributed to the Airport having a $40 million unrestricted fund balance (2019 airport annual report, page 13). In fact, Councilman Josh Carlson brought this to the attention of the Airport’s representatives at the September 1st meeting. In that meeting it was clear the airport’s representatives didn’t know how much money the airport had. They just wanted more.
RE: Disposition of Ordinance No. PO-040-2020
Veto Message of Mayor-President Joshua S. Guillory
Dear Council Members:
I have vetoed Ordinance No. PO-040-2020, seeking to increase the property tax rate of the Lafayette Regional Airport millage to 1.83 mills. I do so for the following reasons. I do not believe in increasing taxes without a vote of the people. While property values in Lafayette Parish have dropped since the last reassessment, the first impulse should be for government to focus upon the services that are essential to its mission and cut others, rather than to automatically impose greater property taxes on our citizens. This veto is directed toward that basic principle.
I would urge the Parish Council not to override this veto, and instead, to pass another ordinance levying this tax at its prior millage. According to the 2019 report dated June 17, 2020 from the Louisiana Legislative Auditor , the Lafayette Regional Airport has an unrestricted net position of approximately $40,707,753 and can certainly continue to accomplish its core functions without imposing an additional tax burden upon the people of this parish.
For all of the foregoing reasons, I have vetoed Ordinance No. PO-040-2020.
Complete VETO of the other taxes, too!
The other ordinance, PO-039-2020, was an amalgamation of 13 other property taxes, which made a line-item veto impossible. So, Mayor-President Joshua Guillory just vetoed the whole thing. However, as you can see from his comments, he was clear that he would have preferred to line out items with high fund balances, or programs that are not a core function of government.
RE: Disposition of Ordinance No. PO-039-2020
Veto Message of Mayor-President Joshua S. Guillory
Dear Council Members:
As discussed at length during the Council discussion on these matters, I am strongly opposed to tax increases without a vote of the people. There are serious questions regarding these measures. Therefore, I have vetoed PO-039-2020.
The specific levies within Ordinance No. PO-039-2020 that prompt me to veto this ordinance are the following:
1. The 3.12 mill Library tax (2017-2026)
2. The 1.97 mill Library tax (2013-2022)
3. The 2.36 mill Combined Health Unit tax
4. The 0.27 mill Cultural Economy tax
While property values in Lafayette Parish have dropped since the last reassessment our first step should be for government to focus upon the services that are essential to its mission and prioritize, rather than to automatically impose greater property taxes on our citizens. This veto is directed toward that basic principle. I hereby urge the Parish Council to pass revised ordinances levying these taxes at their prior millages.
Leaving the two Library millages at their current rates would result in a total reduction in revenue to the Lafayette Parish Library of approximately $746,099. This reduction consists of a reduction in the 3.12 mill Library tax (2017-2026) of approximately $460,826, and a reduction in the 1.97 mill Library tax (2013-2022) of approximately $285,273. Similarly, leaving the Combined Health Unit millage at its current rate would result in a total reduction of revenue of approximately $373,050.
After a thorough review of the last few years fiscal year-end audits, it is readily apparent that the budgeted amounts for each of the fiscal years exceeds identified needs. Quite simply, the agencies affected by these reductions in revenue can continue to provide their essential services to the citizens of Lafayette Parish even with this reduced revenue.
With regard to the levy of the 0.27 mill Cultural Economy tax, that matter is scheduled to be placed before the voters of Lafayette Parish on November 3, 2020 on the question of whether that millage is better devoted to Parish fire protection and Parish roads and bridges. It is premature to raise the Cultural Economy millage when it may be rededicated by the voters in less than two months.
For all of the foregoing reasons, I have vetoed Ordinance No. PO-039-2020.
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