Harlan Kirgan
The St. Landry Parish Council approved obtaining a line of credit of up to $1.5 million from Washington State Bank.
The credit line is to end a practice of moving money from account to account and sometimes using dedicated funds.
The measure passed 10-2 with Council members Alvin Stelly voting “No” and Nancy Carriere abstaining.
Parish President Bill Fontenot said, “Basically, we would like to do our accounting in a more transparent and appropriate way of business.”
Fontenot said, “You are moving money to make it to the end of the year. Robbing one fund to fund another fund.”
He added, “That’s those ‘due tos’ and ‘due froms’ we are always talking about.”
The plan next goes to the state Bond Commission for approval.
“We’ve always borrowed money, but we’ve borrowed it from ourselves and it is not efficient doing it that way,” he said at Wednesday’s meeting of the Parish Council in Opelousas.
Eric Lafleur, a state senator and bond attorney who was at the meeting, said the credit line would prevent the parish government from spending money that has been set aside in various accounts.
The interest rate would be about 3 percent and the money would likely be borrowed in the fall and must be repaid by March 1, he said.
Asked what happens if the parish fails to repay the money by March 1, Lafleur said of the bank, “They are going to come get it.”
Lafleur said the parish will use tax money that comes at the end and beginning of the year to pay the loan.
Spending would have to stay within the boundaries of the parish budget, he said.
“He can’t spend more than what you approve in your budget,” he said of the parish president.
Council member Harold Taylor said, “Too often we have to borrow from dedicated funds and that ain’t a good thing to do. That is a really dangerous thing to do if you don’t pay it back.”
Fontenot said the credit line would ease the parish’s cash flow problems.
The parish receives about $4.9 million in property taxes, which are due by the end of year.
“But in order to make our budget make it to the end of the year we had to borrow from accounts and also at times it got so difficult to meet payroll and all that some vendors were paid late,” Fontenot said in an earlier interview.
St. Landry Parish Government revenues total $22.1 million. The top two revenue sources in 2016 were $4.9 million in property taxes and $6.5 million in sales tax.
The sale tax revenue is dedicated to the Smooth Ride Home Program, which will pave about 300 miles of road by end of this year. The 15-year program passed in 2013 is funded by a 2 percent sales tax collected in rural St. Landry Parish.
But that sales tax money is dedicated to the Smooth Ride Home Program.