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Louisiana lawmakers convene task force to help distressed municipalities

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(The Center Square) — A legislative task force “to study the dissolution or absorption of fiscally distressed municipalities” set the tone in its first meeting with a vote to change its name.

It’s now known as the “Solutions to Achieve Viability and Efficiency” task force.

Chairman Sen. Louie Bernard, R-Natchitoches, suggested the change following presentations from officials with the Legislative Auditor’s Office, Louisiana Municipal Association, Police Jury Association, and Government Finance Officers Association on the myriad factors impacting the state’s most distressed communities.

The focus, all agreed, should be on measures to proactively help municipalities maintain financial health amid declining populations, business loss, infrastructure issues, and other obstacles that have driven 21 to seek help from the state. Some have sought to dissolve their governments entirely.

Auditors find many cannot pass a budget, declining revenues, degrading water and sewer systems, and inadequate budgeting, financial management and monitoring.

All but one of the municipalities working with the state are losing population, with 21 representing 8% of municipalities with declining populations versus 2% with increasing populations. A financial risk model the LLA uses shows 83 municipalities in fiscal distress.

Since 2005, 12 entities have gone into fiscal administration, which involves the attorney general, treasurer, and LLA voting to put the local government under complete financial control of the state. That fiscal administration, officials said, costs locals roughly $150,000 a year and typically lasts two to three years, officials said.

Currently, there are 22 municipalities in Louisiana with past due annual financial reports, including four with more than three past due. In the last five years, 50 municipalities have submitted annual financial statements past the deadline, not including those with emergency exemptions, officials said.

A presentation from the Louisiana Municipal Association provided an overview of the many financial strains on local governments, highlighting over 100 unfunded mandates.

The mandates include civil service requirements, police and fire workers compensation, election expenses, coroner’s fees, state agency fees, and costs complying with open meetings laws, among many others.

Failing water systems — more than 40 in Louisiana with “D” or “F” grades — is another significant challenge.

Guy Cormier, executive director of the Police Jury Association of Louisiana representing parishes, stressed repeatedly that the task force should focus on solutions to help locals avoid dissolving, while others on the task force called for clarity in that process for those that can’t avoid it.

The task force was created by Senate Concurrent Resolution 43 approved in the 2023 session to study the issues facing struggling municipalities and create a process for helping municipalities fix their finances.

Members consist of lawmakers, local elected officials, designees from the attorney general, state treasurer, and commissioner of administration, as well as representatives from the Louisiana Municipal Association, Police Jury Association, Louisiana Sheriff’s Association, state Chiefs of Police, AFL-CIO, and the Louisiana School Boards Association.

The task force will study a variety of solutions, such as regional service agreements and other ways municipalities can work together with parishes and others to save money, and make recommendations for action in a report to the legislature by next September.

Its next meeting is scheduled for Oct. 25 in Baton Rouge.

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