In The News › Sheriff, mayor forge rare alliance on property tax proposal

Sheriff, mayor forge rare alliance on property tax proposal

By Jim Mustian

The Advocate

Octobner 26, 2014

After months of divisive bickering over the future of Orleans Parish Prison, Mayor Mitch Landrieu and Sheriff Marlin Gusman have found a rare bit of common ground on the Nov. 4 ballot.

In an unusual consensus, both elected officials are supporting a property tax that would help pay for a series of costly, court-ordered reforms at the jail for which the city, under state law, is financially responsible. In coming years, city officials expect the sheriff’s consent decree with the U.S. Justice Department to cost tens of millions of dollars — a liability that poses a threat to the stability of city coffers.

The ballot proposition, a 10-year tax expected to generate as much as $9 million a year, would not increase current property tax rates but would give Gusman considerably more latitude in how he spends the proceeds of a tax that benefits his office. While the existing millage is earmarked specifically to pay off bonds for capital projects, the ballot measure would let him use the money to pay for the raft of consent-decree related costs at the jail, such as salaries for new deputies and medical and mental health care for inmates.

The Orleans Parish Law Enforcement District — the name under which the Sheriff’s Office issues bonds — already levies a 2.9-mill property tax dedicated to servicing bonds that voters authorized in 2008. That millage rate, which is set each year at a level necessary to cover the principal and interest payments, is projected to decline in coming years as the bonds are retired.

The proposed new, 10-year tax essentially would capture for other purposes the portion of the millage no longer needed for debt service. The new tax would be levied at 2.9 mills minus the rate of the current tax. In other words, the new tax rate would increase as the current tax decreases, keeping the total millage levied by the district at 2.9 mills a year.

“The taxpayer won’t see it at all,” Gusman said of the new tax, though acknowledging voters would forego an eventual tax decrease by approving the measure. “It’s meant to be flexible while at the same time limiting it to Sheriff’s Office funding.”

The sheriff said he doesn’t know of a single organization that opposes the proposition. Even the Bureau of Governmental Research, which has expressed skepticism about Gusman’s unchecked control over the Law Enforcement District, is supporting the ballot measure.

BGR, a nonpartisan research organization, said it continues to be concerned about the governance of the district, adding that “the failure of the Sheriff’s Office to provide details about how the revenue from the proposed tax would be spent is troubling.”

“But it is clear,” the group said in a recent report, “that additional revenue is needed to implement court-ordered reforms at the Parish Prison, and the court’s oversight provides greater confidence that the sheriff will spend the funds appropriately.”

Homeowners with a homestead-exempt property valued at $200,000 would still owe $36.25 a year under the 2.9-mill property tax, according to BGR.

The uncommon alliance forged by the sheriff and the mayor highlights the dire conditions at the jail and the fragility of the city’s budget.

Landrieu, speaking at a news conference last week, warned that a failure to pass the proposition would have “real” consequences for the city, which still would be required to foot the bill for jail reforms. The millions of dollars the city would have to reallocate to the jail could otherwise pay for upward of 100 new police officers, the mayor said.

“If this proposition does not pass,” Landrieu said, “we would have to cut city services and cut the general fund to help pay for mental health and medical care at the jail.”

Landrieu told The New Orleans Advocate in a recent interview that he has been working with the Federal Emergency Management Agency “to give us more money than they wanted to give us to rebuild (Katrina-damaged) things in New Orleans that they undervalued before.”

“We have confected an agreement with FEMA,” Landrieu said, “to give us enough capital money to actually go in and pay for” several projects now being financed by Law Enforcement District bonds.

“We think we’ve killed two birds with one stone by (paying for) the capital (projects) on the FEMA side and giving the sheriff the money to do the medical and mental health (reforms) that the judge is almost certainly going to tell us to do,” he added.

Created by state law in 1989, the Law Enforcement District is a special taxing entity that has allowed the Sheriff’s Office to issue bonds for buildings and equipment. For instance, several million dollars generated by the district’s millage were allocated to pay for parts of a soon-to-open new jail not covered by FEMA grants.

Voters in 2008 approved an extension of the 2.9-mill property tax in connection with a $63 million bond issue that generated capital funds for the Sheriff’s Office, the municipal and juvenile courts, the coroner, the district attorney and the clerk of Criminal District Court. Gusman said none of those other criminal justice entities that have benefited from Law Enforcement District funds would be adversely impacted by the current ballot proposition.

For his part, Landrieu said he retains reservations about Gusman’s approach to the jail reforms, and he expressed renewed frustration with the state law that requires the city to pay for inmates’ care even though the sheriff controls operations at the jail.

“This is a conundrum that exists in Louisiana law that makes it hard to govern,” the mayor said. “When you have a political entity that has the power to run an office but doesn’t have the responsibility to pay for it and somebody else does, it allows you to make decisions that are not consistent with the common good.”

But at a time when the city and sheriff have repeatedly clashed over how to satisfy the terms of the consent decree, Landrieu said the Law Enforcement District tax proposition “is by far the best idea that I’ve seen.”

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