ENROLLED
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VETOED
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Veto Message
Regular Session, 2010
HOUSE BILL NO. 277
BY REPRESENTATIVE SAM JONES
AN ACT1
To enact Chapter 10-E of Title 33 of the Louisiana Revised Statutes of 1950, to be2
comprised of R.S. 33:4550.1 through 4550.12, relative to St. Mary Parish; to create3
and provide for the St. Mary Hydroelectric Authority as a political subdivision4
within such parish; to provide for the boundaries, governance, and powers and duties5
of the district; to provide for district funding, including the issuance of bonds and the6
use of district funds; and to provide for related matters.7
Notice of intention to introduce this Act has been published8
as provided by Article III, Section 13 of the Constitution of9
Louisiana.10
Be it enacted by the Legislature of Louisiana:11
Section 1. Chapter 10-E of Title 33 of the Louisiana Revised Statutes of 1950,12
comprised of R.S. 33:4550.1 through 4550.12, is hereby enacted to read as follows: 13
CHAPTER 10-E. ST. MARY HYDROELECTRI C AUTHORITY14
§4550.1. Creation15
All the territory in the parish of St. Mary lying within the watershed of the16
Wax Lake Outlet and the Atchafalaya River and their tributaries, shall be embraced17
in the limits of and shall constitute a district to be known as the St. Mary18
Hydroelectric Authority, referred to in this Section as the "district".19
§4550.2. Board of commissioners20
A. The governing authority of the district shall be vested in a board of21
commissioners, referred to in this Chapter as the "board", composed as follows:22
(1) The state representative who represents House District No. 50, or his23
designee.24 ENROLLEDHB NO. 277
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(2) The state representative who represents House District No. 51, or his1
designee.2
(3) The state senator who represents Senate District No. 21, or his designee.3
(4) The president of St. Mary Parish shall appoint two members subject to4
the approval of the parish governing authority.5
(5) The mayor of the town of Baldwin shall appoint one member subject to6
the approval of the municipal governing authority.7
(6) The mayor of the town of Berwick shall appoint one member subject to8
the approval of the municipal governing authority.9
(7) The mayor of the city of Franklin shall appoint one member subject to10
the approval of the municipal governing authority.11
(8) The mayor of the city of Morgan City shall appoint one member subject12
to the approval of the municipal governing authority.13
(9) The mayor of the city of Patterson shall appoint one member subject to14
the approval of the municipal governing authority.15
(10) The chief of the sovereign nation of the Chitimacha Tribe of Louisiana16
shall appoint one member subject to the approval of the tribal council, or one17
member shall be appointed pursuant to any method determined by the tribal council.18
B.(1) The members serving pursuant to Paragraphs (A)(4) through (10) of19
this Section shall serve four-year terms after serving initial terms as follows: two20
members shall serve an initial term of one year; two shall serve two years; two shall21
serve three years; and two shall serve four years as determined by lot at the first22
meeting of the board.23
(2) Each member serving pursuant to Paragraphs (A)(1) through (3) of this24
Section shall serve during his term of office. Each designee shall serve at the25
pleasure of the designating authority.26
C. Six members of the board shall constitute a quorum for the transaction of27
business.28 ENROLLEDHB NO. 277
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D. Any vacancy which occurs prior to the expiration of the term for which1
a member of the board has been appointed shall be filled for the remainder of the2
unexpired term in the same manner as the original appointment.3
E. The board shall fix a time and place for the holding of its regular meetings4
and shall hold at least one regular meeting in each calendar month. Special meetings5
may be held upon call of the chairman or four members of the board at such time and6
place as may be designated, after written notification to the full membership. The7
board shall hold no more than two special meetings during one calendar year.8
F. Each member of the board shall serve without compensation but shall be9
entitled to be reimbursed for expenses actually incurred in attending meetings of the10
board or its committees, or in the transaction of any business of the authority, when11
such business has been authorized by the board.12
G. The board shall elect from its members a chairman, a vice chairman, and13
such other officers as it may deem necessary. The board shall also select a secretary14
and a treasurer, or a secretary-treasurer who need not be members of the board. The15
duties of the officers shall be fixed by the bylaws adopted by the board; however, it16
shall be the duty of the secretary to preserve a record of all business transacted by17
the board and to perform such other duties as the board may designate. The board18
may fix the compensation of any secretary or treasurer who is not a member of the19
board.20
H. The board shall adopt such bylaws and rules and regulations for the21
orderly transaction of its business and affairs as it may deem fit. It may appoint and22
retain all employees it may consider desirable, including engineers and attorneys23
specifically including but not limited to a special counsel who shall be charged with24
negotiating and renegotiating contracts dealing with fees paid to the district for25
goods or services and any other duties the board may assign. The board may appoint26
a general manager, experienced in the field of electrical generation, management, or27
sales as well as personnel, budgetary, and other administrative fields and may28
provide that all or certain classes of employees shall be employed and discharged by29
the general manager.30 ENROLLEDHB NO. 277
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§4550.3. Status; suits; process; exemption from taxation1
A. The district is hereby declared to be a political subdivision of the state of2
Louisiana as defined in the Constitution of Louisiana and an agency and3
instrumentality of the state of Louisiana required by the public convenience and4
necessity for the carrying out of the functions of the state, and to be a corporation5
and body politic and corporate, with power of perpetual succession, invested with6
all powers, privileges, rights, and immunities conferred by law upon other7
corporations of like character, including but not limited to port authorities, port8
commissions, and port, harbor, and terminal districts within the state.9
B. The district shall not have the power to levy taxes, but it may assess and10
collect charges, fees, and rentals for the use of its properties and facilities and for the11
construction, installation, maintenance, and operation of any property or facility12
owned by it or in which it has an interest only for the purpose of and directly related13
to generating or transmitting hydroelectric power. The district shall have and14
possess the authority to sue and be sued. All legal process shall be served upon the15
chairman of the board.16
C. The domicile of the district shall be within St. Mary Parish.17
D. The district, in carrying out the purposes of this Chapter, shall be18
performing an essential public function of the state of Louisiana and shall not be19
required to pay any tax or assessment on its properties or any part thereof, nor to pay20
any excise, license, or other tax or imposition on its operating revenues, and the21
bonds issued pursuant to this Chapter and their transfer and the income therefrom22
shall at all times be exempt from taxation within the state.23
E. The district is deemed not to be an instrumentality of the state for24
purposes of Article X, Section 1(A) of the Constitution of Louisiana.25
§4550.4. Powers26
A. The district's power, authority, and jurisdiction shall be limited to the27
geographical boundaries of the parish of St. Mary, and all actions of the district shall28
be solely for the purpose of generating or transmitting hydroelectric power. The29
district shall have the power:30 ENROLLEDHB NO. 277
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(1) To have a corporate seal.1
(2) To acquire by purchase, gift, devise, lease, expropriation, or other mode2
of acquisition, to hold, pledge, encumber, lease, and dispose of immovable and3
movable property of every kind within its territorial jurisdiction, whether or not4
subject to mortgage or any other lien.5
(3) To make and enter into contracts, conveyances, mortgages, deeds or6
trusts, bonds, and leases in the carrying out of its corporate objectives, including but7
not limited to contracts for the legal services of a special counsel.8
(4) To let contracts for the construction or acquisition in any other manner9
of property and facilities incident to the carrying out of the corporate purposes of the10
district, which contracts shall be let as otherwise provided by law.11
(5) To incur debts and borrow money, but no debt so incurred shall be12
payable from any source other than the revenues to be derived by the district from13
sources other than taxation.14
(6) To fix, maintain, collect, and revise rates, charges, and rentals for the15
facilities of the district and the services rendered thereby, including but not limited16
to all charges for services and goods provided by or through the Wax Lake Outlet17
and the Atchafalaya River.18
(7) To pledge all or any part of its revenues.19
(8) To enter into agreements of any nature with any person, corporation,20
association, or other entity, including public corporations, political subdivisions,21
municipalities, and federal and state agencies and instrumentalities of every kind, for22
the operation of all or any part of the properties and facilities of the district.23
(9) To control in order to utilize and distribute the waters of the rivers and24
streams of the Wax Lake Outlet and the Atchafalaya River watershed, including but25
not limited to all waters flowing through the Wax Lake Outlet and the Atchafalaya26
River; and in addition to all of the aforementioned powers for the beneficial27
utilization of water resources, to control and employ such waters of the Wax Lake28
Outlet and the Atchafalaya River and its tributaries in the state of Louisiana,29
including the storm and flood waters thereof, as set forth in this Paragraph:30 ENROLLEDHB NO. 277
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(a) To provide through practical and legal means for the use and1
coordination of the regulation of the waters of the Wax Lake Outlet and the2
Atchafalaya River and its tributaries.3
(b) To provide by adequate organization and administration for the4
preservation of the equitable rights of the people of the different sections of the5
watershed area in the beneficial use of the waters of the Wax Lake Outlet and the6
Atchafalaya River and its tributaries.7
(c) For the equitable distribution of such waters to the regional potential8
requirements for all uses including hydroelectric, domestic, municipal, maritime,9
port, and manufacturing, provided that no generating capacity, structures, or facilities10
other than hydroelectric shall be installed by the district. The district shall have no11
power to construct, own, or lease any electric transmission or distribution lines;12
however, the district may construct, own, or lease transmission lines in order to make13
electrical power generated by the district available for purchase through a connection14
to transmission lines of an electrical system purchasing electric power from the15
district.16
(10) To utilize the waters of the Wax Lake Outlet and the Atchafalaya River17
for the generation of electric power, to sell the use of the water of such waterways18
for the production of electric power, to provide or furnish power and to that end to19
construct, maintain, operate, or lease any or all hydroelectric generating facilities20
within its territorial jurisdiction useful for such purpose.21
(11) To purchase or construct all works and facilities necessary or22
convenient to the exercise of the powers provided in this Section and to accomplish23
the purposes specified in this Chapter, and to purchase or otherwise acquire, within24
its territorial jurisdiction all immovable and movable property necessary or25
convenient for carrying out such purposes.26
(12) To enter into any and all contracts and other agreements with any27
person, any public or private entity, any government or governmental agency,28
including the United States of America, the state of Louisiana, and the agencies,29 ENROLLEDHB NO. 277
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departments, and political subdivisions thereof, which contracts and other1
agreements may provide for the sale and utilization of the hydroelectricity generated.2
B. Title to all property acquired by the district shall be taken in its corporate3
name and shall be held by it as an instrumentality of the state of Louisiana. The4
district shall have and be recognized to exercise such authority and power of control5
and regulation over the waters of the Wax Lake Outlet and the Atchafalaya River and6
its tributaries as may be exercised by the state of Louisiana, subject to the provisions7
of the Constitution of Louisiana.8
C. Nothing in this Chapter is intended to restrict the use of water from the9
Wax Lake Outlet or the Atchafalaya River or outside of St. Mary Parish for any10
reason other than hydroelectric power generation; however, during any time period11
that the district restricts the use of water within the parish for electric generation or12
is prevented from generating electricity, the utility shall not pay the district for power13
that it was prevented from generating.14
§4550.5. Cooperation with federal and state agencies15
The board may cooperate with the government of the United States and may16
contribute financially to the expense of such improvement projects as are or may be17
authorized or adopted by the United States; it may also cooperate with all agencies,18
departments, and subdivisions of the state of Louisiana in all undertakings, the19
purpose of which shall be the furtherance of the objects and purposes for which the20
district is created, and the authority to cooperate with any such agency of the state21
or federal government shall include the authority to contract with any such agency22
and to accept any grant or gratuity made for any of the purposes of this Chapter.23
§4550.6. Authority of state agencies to cooperate; construction of facilities24
A. There is hereby expressly conferred upon the state of Louisiana, its25
departments, and agencies and upon the political subdivisions of the state, the26
authority to cooperate with the board to make contributions or grants to the district27
for any of the purposes of this Chapter and to enter into contracts and agreements28
with the district in furtherance of any of the purposes of this Chapter.29 ENROLLEDHB NO. 277
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B. The district may locate, construct, operate, and maintain any of its works1
or facilities over, under, through, in, or along any of the lands which are the property2
of the state or of any subdivision, institution, agency, or instrumentality thereof,3
within its territorial jurisdiction provided that a cooperative endeavor is agreed to4
and executed between the district and the appropriate state entity.5
C.(1) The district and its authorized agents and employees may have the6
privilege of entering upon any lands, waters, and premises in the state for the purpose7
of making surveys, soundings, drillings, examinations, and appraisals as it may deem8
necessary or convenient for the purpose of this Chapter.9
(2) The district shall make reimbursement for any actual damages resulting10
to such lands, waters, or premises as a result of such activities.11
§4550.7. Bonds12
A.(1) For the purpose of providing funds for the acquisition, by purchase,13
construction or otherwise, of any property or facilities which the district is authorized14
to acquire pursuant to this Chapter, including the acquisition of water rights, and for15
extending and improving any such property and facilities, the district may incur debt16
and issue revenue bonds to be secured by the fees, assessments, or any revenues17
collected by the district for the purposes of the district. There may be included in the18
amount of any such bond issue reasonable allowance for legal, engineering, and19
fiscal services, interest during construction and for one year after the estimated date20
of completion of construction, and other expenses in connection with the21
authorization and issuance of the bonds and the acquisition or construction of the22
improvements.23
(2) Revenue bonds of the district shall be issued in the manner as provided24
in Part XII or Part XIII of Chapter 4 of Subtitle II of Title 39 of the Louisiana25
Revised Statutes of 1950 or any other applicable law. Revenue bonds issued under26
this Section shall be authorized by resolution of the district and shall be limited27
obligations of the district, the principal of and interest on which shall be payable28
solely from the revenues as provided in Paragraph (1) of this Subsection or from29
income and revenue derived from the sale, lease, or other disposition of the project30 ENROLLEDHB NO. 277
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or facility to be financed by the bonds, from the income and revenue derived from1
the sale, lease, or other disposition of any existing project or facility acquired,2
constructed, and improved under the provisions of this Section, or from any other3
income or revenue derived from any project or facility so financed or any such4
existing project or facility; however, in the discretion of the district, the bonds may5
be additionally secured by mortgage or other security device covering all or part of6
the project from which the revenues so pledged may be derived. Any refunding7
bonds issued pursuant to this Subsection shall be payable from any source described8
above or from the investment of any of the proceeds of the refunding bonds9
authorized under this Section and shall not constitute an indebtedness or pledge of10
the general credit of the district within the meaning of any constitutional or statutory11
limitation of indebtedness and shall contain a recital to that effect. Bonds of the12
district shall be issued in such form, shall be in such denominations, shall bear13
interest, shall mature in such manner, and shall be executed as provided in the14
resolution authorizing the issuance thereof. The bonds may be subject to redemption15
at the option of and in the manner determined by the board in the resolution16
authorizing the issuance thereof.17
(3) The district may in its own name and behalf borrow from time to time in18
the form of certificates of indebtedness. The certificates shall be secured by the19
dedication and pledge of monies of the district derived from any lawful sources,20
including those revenues as provided in Paragraph (1) of this Subsection and any21
other sources of income or revenue of the district, or any combination of such22
sources, provided that the term of such certificates shall not exceed ten years, and the23
annual debt service on the amount borrowed shall not exceed the anticipated24
revenues to be dedicated and pledged to the payment of the certificates of25
indebtedness, as shall be estimated by the board of the district at the time of the26
adoption of the resolution authorizing the issuance of such certificates. The estimate27
of the board referred to in the authorizing resolution shall be conclusive for all28
purposes of this Section.29 ENROLLEDHB NO. 277
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(4) Bonds, certificates, or other evidences of indebtedness issued by the1
district pursuant to this Section are deemed to be securities of public entities within2
the meaning of Chapters 13 and 13-A of Title 39 of the Louisiana Revised Statutes3
of 1950, and shall be subject to defeasance in accordance with the provisions of4
Chapter 14 of Title 39 of the Louisiana Revised Statutes of 1950, and may be5
refunded in accordance with the provisions of Chapters 14-A and 15 of Title 39 of6
the Louisiana Revised Statutes of 1950, and may also be issued as short-term7
revenue notes of a public entity under Chapter 15-A of Title 39 of the Louisiana8
Revised Statutes of 1950.9
(5) The issuance and sale of bonds, certificates of indebtedness, notes, or10
other evidence of debt by the district shall be subject to approval by the State Bond11
Commission.12
(6) Any resolution authorizing the issuance of bonds pursuant to this Chapter13
may contain covenants, including but not limited to:14
(a) The purpose or purposes to which the proceeds of the sale of the bonds15
may be applied and the deposit, use, and disposition thereof.16
(b) The use, deposit, securing of deposits, and disposition of the revenues of17
the district, including the creation and maintenance of reserves.18
(c) The issuance of additional obligations payable from the revenues of the19
district.20
(d) The operation and maintenance of the properties of the district.21
(e) The insurance to be carried thereon and the use, deposit, and disposition22
of insurance monies.23
(f) The books of account and records and the inspection and audit thereof24
and the accounting methods of the district.25
(g) The nonrendering of any free service by the district.26
(h) The preservation of the properties of the district free from any mortgage,27
sale, lease, or other encumbrance not specifically permitted by the terms of the28
resolution.29 ENROLLEDHB NO. 277
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(i) The appointment and the powers and duties of any trustee who may be1
named in such resolution for the purpose of carrying out functions designed to2
safeguard the security of such bonds.3
(7) While any bonds are outstanding under this Section, it shall be the duty4
of the board to fix and from time to time to revise the rates of compensation for all5
commodities and services sold or rendered by the district which will be fully6
adequate to pay the expenses of operating and maintaining the district and its7
properties, to pay principal of and interest on its obligations promptly as principal8
and interest fall due, and to carry out all of the provisions and covenants of the9
resolution or resolutions authorizing such bonds. Nothing contained in this Section10
shall be so construed as to prevent the execution of leases or agreements by the11
district providing for the lease of properties of the district or the sale of commodities12
and services sold or rendered by the district at fixed rentals or prices for a term of13
years, provided that the rentals or prices so named are at the time of the execution14
of any such lease or agreement, together with the other reasonably anticipated15
revenues of the district, sufficient to assure the ability of the district to carry out the16
requirements of this Chapter and the requirements of the resolution or resolutions17
authorizing its bonds.18
(8) Such bonds, certificates of indebtedness, notes, or other evidence of debt19
shall have all the qualities of negotiable instruments under the commercial laws of20
the state of Louisiana.21
§4550.8. Contesting validity of bonds; contracts22
Bonds and any other evidences of indebtedness of the district shall be issued,23
sold, and delivered in accordance with the terms and provisions of a resolution24
adopted by the board. For a period of thirty days from the date of publication of any25
resolution or ordinance authorizing the issuance of any bonds, certificates of26
indebtedness, notes, or other evidence of debt of the district, any interested person27
may contest the legality of such resolution or ordinance and the validity of such28
bonds, certificates of indebtedness, notes, or other evidence of debt issued or29
proposed to be issued thereunder and the security of their payment, after which time30 ENROLLEDHB NO. 277
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no one shall have any cause of action to contest the legality of said resolution or1
ordinance or to draw in question the legality of said bonds, certificates of2
indebtedness, notes, or other evidence of debt, the security therefor, or the debts3
represented thereby for any cause whatever, and it shall be conclusively presumed4
that every legal requirement has been complied with, and no court shall have5
authority to inquire into such matters after the lapse of thirty days.6
§4550.9. Acquisition of lands, servitudes, and rights-of-way7
A. There is expressly conferred upon the district, the right to acquire lands,8
servitudes, and rights-of-way in St. Mary Parish solely for the purpose of generating9
or transmitting hydroelectric power by purchase, exchange, expropriation, or10
otherwise.11
B. Should the district acquire the ownership of any timber it may sell the12
same in the following manner:13
(1) The district shall offer the timber for sale at public auction after having14
first given public notice of such sale in the manner provided by law.15
(2) If no satisfactory bid is received, the district may sell the timber at16
private sale to any purchaser for any amount greater than the amount offered by the17
highest bidder at the public auction.18
§4550.10. Budget; administrative costs; revenues19
A. The district shall develop and adopt an initial five-year projected20
administrative budget. The district shall thereafter develop and adopt an annual21
budget for administrative costs based upon a baseline established by the projected22
budget.23
B.(1) Beginning the first year in which the district develops and adopts an24
annual budget for administrative costs, at least ninety percent of all revenues earned25
by the district shall be used to provide hurricane protection for electrical26
transmission and distribution in St. Mary Parish. The goal of any such protection27
shall be to increase the resiliency of electrical transmission and distribution systems.28
(2) The district may enter into a cooperative endeavor agreement for such29
purpose with any electrical system providing services in St. Mary Parish regardless30 ENROLLEDHB NO. 277
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of whether any such system is privately owned, publicly owned, or part of a1
cooperative.2
(3) Beginning the first year in which the district develops and adopts an3
annual budget for administrative costs and each year thereafter, no more than ten4
percent of the revenues earned by the district shall be used for administrative costs.5
§4550.11. Conflicts; approval of projects6
All actions or activities taken pursuant to this Chapter shall be taken or7
implemented only to the extent such actions or activities are not in conflict with and8
are consistent with the Atchafalaya Basin Master Plan or Annual Basin Plan and the9
Coastal Protection and Restoration Authority's Master Plan for coastal protection and10
restoration for a sustainable coast. Furthermore, any project authorized by the11
district which may impact water flow or water levels within the Atchafalaya Basin,12
as defined by R.S. 30:2000.2, or through Wax Lake Outlet or the Atchafalaya River13
shall be approved in advance by the Atchafalaya Basin Research and Promotion14
Board and the Coastal Protection and Restoration Authority.15
§4550.12. Chapter as complete authority; audits and reports; construction of16
Chapter17
A. This Chapter shall be full, complete, and independent authority for the18
performance of all acts authorized by this Chapter, and no other statute or legislative19
act shall be construed to be applicable to the carrying out of the powers granted by20
this Chapter unless expressly made applicable.21
B.(1) A complete book of accounts shall be kept by the district. Within one22
hundred eighty days after the close of each fiscal year, the account books and records23
of the district and of the depository of the district shall be audited by the legislative24
auditor, or a certified public accountant, in such manner as to enable him to report25
to the legislature as to the manner and purpose of the expenditure of all funds of the26
district, and a report thereon shall be submitted at the first regular meeting of the27
board held following the audit.28 ENROLLEDHB NO. 277
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(2) Two copies of the report shall be filed in the office of the district; one1
copy of the report shall be filed with the legislative auditor. All copies shall be open2
to public inspection.3
C. This Chapter is intended to carry out a function of the state to protect the4
health and welfare of the inhabitants of the portion of the state to be affected by this5
Chapter and shall be liberally construed by the courts to effect its purposes.6
Section 2. This Act shall become effective upon signature by the governor or, if not7
signed by the governor, upon expiration of the time for bills to become law without signature8
by the governor, as provided by Article III, Section 18 of the Constitution of Louisiana. If9
vetoed by the governor and subsequently approved by the legislature, this Act shall become10
effective on the day following such approval.11
SPEAKER OF THE HOUSE OF REPRESENTATI VES
PRESIDENT OF THE SENATE
GOVERNOR OF THE STATE OF LOUISIANA
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VETO MESSAGE
House Bill No. 277 seeks to give the newly created St. Mary Hydro-Electric District sole
authority over the use of certain river and water resources and the use of all funding derived
from these resources. The larger goal of this bill – to promote hydro-electric power - is a
laudable goal, but fundamental problems with this legislation remain.
This bill directly conflicts with another expression of the Legislature this session as to how
the state should regulate hydroelectric power. Specifically, Senate Bill No. 183 by Sen. N.
Gautreaux calls for the state to manage all future hydroelectric projects as well as the
revenues generated by these projects. I am concerned with setting up a regulatory structure
that would result in 63 parishes operating under one structure that is managed by the state
and one parish operating under a completely different structure. Additionally, the Attorney
General recently issued an opinion after this bill was introduced indicating that water is a
natural resource of the state, requiring it to be managed by the state in a similar fashion to
our other resources like fisheries, oil, and gas.
For these reasons, I have vetoed House Bill No. 277 and hereby return it to the House of
Representatives.