Lafourche Parish establishes $5 million credit line

The Lafourche Parish Council established a $5 million line of credit with Capital One Bank at its last meeting. Parish President Charlotte Randolph said the money would be used in advance of Community Development Block Grant reimbursement.

The parish president maintains the sole authority to pull from the fund. She can do so without council approval but must give each councilman prior notice before drawing from the credit line.

The parish has $33 million in pending projects, all of which have received council approval. Many of the projects are stalled until CDBG funds become available, Randolph said.

“We don’t want to delay these projects,” she said. “We don’t want to say we can’t afford to pay for these projects. Each one of you has a vested interest in this CDBG money. This money is only a reserve in the event that we are not repaid in a timely manner.”

The ordinance that authorized the line of credit was debated for about 10 minutes by the council and eventually passed with a 5-to-4 vote. Councilmen Louis Richard, Joe Fertitta, Matt Matherne and Daniel Lorraine opposed its passage.

Lorraine, the longest-tenured councilman, said, “I’ve never dealt with one like this before,” and raised hypothetical questions about what would happen if CDBG reimbursement never came.

Once pledged, CDBG reimbursements will come to fruition, Randolph said. It’s just the matter of time in between that is delaying the parish on some of its projects.

“Otherwise, we will not touch this money if not necessary,” she continued. “Again, as we said earlier, it’s the type of thing that we would bring to the council and advise you of any expenditure.”

The movement to establish a line of credit began in November. At the time, the council unanimously authorized the administration to begin researching the process to establish a $3 million line of credit with the Louisiana Department of Treasury.

Matherne asked that the ordinance be deferred until the council’s next meeting so that it could be looked at more closely. The ordinance, at the administration’s request, was deferred at the two previous meetings while the details were finalized.

Councilman Rodney Doucet, who voted in favor of the ordinance, described the line of credit as “working capital” and said it could be used to “get the parish back in order” after an unforeseen disaster, such as a hurricane, while the parish waits on FEMA money.

Any money withdrawn from the credit line carries a 3.65 percent interest rate.