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A local oil company failed to pay more than $300,000 in taxes on its wells to Terrebonne Parish over a 3-year period, according to a report by private auditors.
The report, still in draft form, points an accusing finger at former sheriff Vernon Bourgeois, alleging that he did not seize the wells as state law mandates. It also contains statements alleging additional management and accountability problems during other allegations of mismanagement during his one four-year term
Bourgeois said last week he was not aware that the company, called Baby Oil and owned by Houma entrepreneur Neil Suard, owes back taxes. The report, prepared by the firm of Kolder, Champagne, Slaven & Co., includes:
• An allegation that Bourgeois improperly drew $16,000 vacation pay when his term ended last year contrary to written procedures.
• Allegations that parish equipment was used without compensation by a company producing the reality show “Cajun Justice” and that deputies were paid for working on the show while they also drew parish salaries.
• Criticism of bookkeeping concerning certain federal grants as well as alleged issues with office credit cards.
• A questioning of how a contract was handled with the private firm that operates the parish’s work-release program for state inmates. A pending attorney general’s opinion, at least in part, indicates that questioned elements of a contract amendment were made in accordance with the law.
The audit does not allege that criminal activity occurred, nor was that its intent. The report, when final, could be subject to a review by the Louisiana Legislative Auditor, however. That office has the ability to refer items for review to the office of the Attorney General.
The president of the New Orleans-based Metropolitan Crime Commission, Rafael C. Goyeneche III, reviewed some of the allegations at the request of the Tri-Parish Times.
Goyeneche noted the limited scope and purpose of such audits. But he also said he found several aspects of the report disturbing and that they may need a closer look by an independent agency such as the Legislative Auditor. There appears a “distinct pattern” of mismanagement according to items in the report, he said.
“Possibly state and federal laws were violated,” Goyeneche said. “Certainly sums money may have gone uncollected and public funds may have been misspent… This appears extremely serious and requires a formal investigation to determine if there is any unlawful conduct.”
Denial of wrongdoing
Bourgeois denies the existence of improprieties and said if there were errors they were just that. He stands by decisions he made during his term.
“I loved serving the public,” Bourgeois said. “I did everything I thought was right for Terrebonne Parish.”
Larpenter, Goyeneche said, should specifically request that the Legisaltive Auditor’s office do its own review of the findings, leaving it up to that agency whether a criminal referral is needed.
“The sheriff should request a complete investigation of the entire term of office of his predecessor,” Goyeneche said.
One of the more troubling aspects of the report to Goyeneche and others who have seen it is the money owed to the parish by Baby Oil.
According to recently filed court papers, Baby Oil was assessed in 2009, 2010 and 2011 for taxes owed on 28 wells, totaling $315,575.81 including interest, penalties and fees.
The court papers say Suard sent a letter to Bourgeois while he was sheriff.
“(Suard) acknowledges that the taxes are due and owed and he requested time from the then-sheriff to pay same,” the court papers read.
The court papers involve a lawsuit filed by Larpenter to collect the taxes.
Bourgeois said he knows that for many years Suard would pay his taxes under protest – an acceptable procedure that is acceptable if there is a disagreement or a problem.
But actual failure to pay taxes, according to the audit, is supposed to result in an immediate seizure and sale of property to satisfy the debt.
“Certain taxpayers failed to timely pay ad valorum taxes on movable property and the former sheriff did not seize and offer such property for sale,” the audit reads, citing the Louisiana Constitution as stating that at the end of each year taxes are due and go unpaid, action is to be taken. The collector – namely the sheriff – “shall advertise for sale the property on which taxes are due.”
Use of the word “shall,” the audit states, indicates that any other action is not an option.
According to Terrebonne Assessor Loney Grabert, various parish agencies would be out the amount of taxes unpaid if they were not collected.
Grabert’s office is concerned not with collecting but with assessing the value of property. The sheriff is the tax collector.
Baby Oil is the only known entity that failed to pay taxes during Bourgeois’ term where prescribed action was not taken.
Bourgeois said he knows of no direct request to him by Suard, and that he cannot recall any time the two ever spoke during his term.
Suard cuts a high profile in Terrebonne Parish. A former owner of the ill-fated Bayou Bucks indoor football franchise, Suard sued the parish in 2004, alleging that misrepresentations were made at the time he made the purchase. He was awarded $800,000.
Messages were left for Suard, the company’s owner, with employees at his Lockport barge company as well as on a cell phone voice-mail last week. Suard, whom an employee said was in Mississippi on a hunting trip, did not respond.
Suard is not accused of any criminal activity.
‘Cajun Justice’
The “Cajun Justice” television show, which airs on the A&E Network, profiles sheriff’s office deputies and contains footage of police work done on Terrebonne’s bayous. The show has been criticized by some locals, who say it bolsters bayou country stereotypes at the expense of truth.
Larpenter has stated emphatically that his department will have no further dealings with the producers.
Bourgeois, who appeared in the show and helped coordinate his officers’ involvement, has stood by the venture. The show has cost the parish nothing, he maintains, and the $1,500 per episode the department was paid more than compensated for the use of vehicles, fuel and other assets.
The audit takes a different view.
“Certain employees received compensation from the TPSO and a television production company for simultaneous periods of time,” it alleges. “Also TPSO may not have received fair value for the use of its equipment during filming.”
The audit states that according to state law, “no public servant shall receive anything of economic value, other than compensation and benefits from the governmental entity to which he is duly entitled, for the performance of the duties and responsibilities of his office or position.”
The Louisiana Constitution, the audit states, bars loaning, pledging or donating “to or for any person, association or corporation, public or private … funds credit, property or things of value of the state or any political subdivision.”
A review should be made of all equipment used during filming, the report states, as well as consultation with the Attorney General and legal counsel as to the legality of simultaneous compensation.
A payment made directly to Bourgeois having nothing to do with the show was the topic of another issue raised in the report.
Bourgeois acknowledges that he drew more than $16,000 in vacation pay, and that employees who resigned or left under any circumstances other than termination drew vacation pay as well.
The audit raises questions about whether the practice is in keeping with certain stated policies of the department. Auditors base that on the lack of a policy allowing it. Some attorneys have suggested that a sheriff, while entitled to vacation time, is not entitled to draw the pay upon leaving.
But the matter is still undecided.
“We also recommend that the Sheriff consult with legal counsel and the Louisiana Attorney General to determine whether the payment of accrued vacation, including the payment to the former Sheriff, were a constitutional violation and, if considered necessary, seek to recover the amounts improperly expended,” the audit states.
Bourgeois has not seen the audit and the auditors had no contact with him. He is anxious to read the completed version, which will likely be available soon.
Larpenter said he cannot comment on the audit since it is still a draft and work concerning it is ongoing.
“They’re still asking me questions,” he said.
