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Lafourche Parish administrators have released a 2016 budget proposal that is conservative compared to last year’s because revenues are down across the board and
potential legislative action threatens to slash property tax revenue by 40 percent.
The 2016 budget, which was presented by Lafourche Parish Finance Director Renita Jackson to the Parish Council during their Sept. 22 meeting, cuts spending by 15 percent compared to this year’s budget.
“General maintenance services and those sort of things are going to be the same,” said Archie Chaisson, Lafourche Parish administrator. “We’re still going to provide the best possible drainage, the best possible services to the residents.”
The proposed operating budget for 2016 is valued at $98,507,852, significantly less than 2015’s $115,922,506 amended budget.
“We’re not going to be doing as many capital projects as we have done previously,” Jackson said. “And the reason being is because we don’t know how [revenues] next year are going to play out. So we would rather meet our operational expenses in order to keep the parish running…”
Jackson told the council the most significant decrease in money coming in is in oil and gas royalties the parish collects from oil and natural gas production. The income is down nearly 35 percent this year when compared to collections made by this time in 2014, by over $1 million dollars.
That fund is used to build drainage projects, repair roads, and help out the animal shelter if they are short of cash. But the only thing that money will go toward next year is the emergency savings account that parish officials can tap into during times of crisis, like a hurricane, Jackson said.
According to Lafourche Parish records, total sales tax collection in 2015 through August was $10,232,746.91, down 37.9 percent compared to collections made through August of last year.
“There have been different companies that have been laying off individuals,” Jackson said. “I still don’t know how [much] of an impact that is going to have on our sales tax, so we’re just going to have to be watching everything by the month to see if it’s going to be a huge change.”
The effects of the reduced income to Lafourche Parish government means that there will be few large-scale construction projects begun in 2016.
The only capital projects budgeted for in 2016 are improvements to the boat launches in Chackbay, Choctaw and Kraemer; work to resurface the tennis court and build bathrooms at Oak Ridge Park; and repairs that are required to be done on some parish roads in order to qualify for grants from the Department of Transportation and Development.
Aside from reductions in all of the different sources of money that the parish collects, parish officials have created a shoe-string budget for next year in case potential changes are made by the state legislature to address the state’s budget problems.
A constitutional amendment to exempt offshore vessels from paying property taxes, freeing the state from having to reimburse vessel owners a full tax credit for that parish tax, is again being discussed as one of many possible remedies to fill a state budget shortfall.
The tax, which goes to parishes but then is refunded to vessel owners by the state, was the target of legislators seeking to close a $1.6 billion budget gap during this year’s legislative session. In the end, the credit was left untouched.
Lafourche Parish would lose over $50 million in property tax revenue, which represents roughly 40 percent of all property taxes collected in the parish every year.
Chaisson said much depends on the new governor and legislature after elections during October, but that the issue will likely be brought up again during the special legislative session that is planned to be held in January or February of next year.
He said the current plan of action is to fight any bill that aims to gut the watercraft tax, but there is no contingency plan developed in case the credit and tax are done away with.
Chaisson said that should their fight against the legislative measure fail, parish officials will have until the beginning of 2017 to plan an alternative way to fund the government and make drastic cuts to spending.
Officially called the Ad Valorem Tax Credit for Offshore Vessels, the credit concerns taxes levied primarily on vessels operating offshore.
No parish in Louisiana collects more than Lafourche in watercraft property taxes. Cameron Parish, which collected $5,492,344 in watercraft taxes last year, is the second-most dependent, relying on watercraft taxes for 14.8 percent of their property tax base.
“To watch that watercraft tax go away would be somewhat catastrophic,” said Archie Chaisson, Lafourche Parish administrator. “When you look at in 2017 having to make a 40 percent budget reduction, that’s going to hurt.”
