Louisiana Senate Bill SB499

Louisiana 2012 Regular Session

• Introduced: 3/12/12
• Refer: 3/12/12
• Report Pass: 4/2/12
• Engrossed: 4/18/12
• Refer: 4/19/12

Caption

Prohibits the State Bond Commission from approving bonds, notes, or other indebtedness of certain political subdivisions against whom there is an unpaid final, nonappealable judgment issued by a court of competent jurisdiction for amounts owed for services performed under contract. (8/1/12) (RE INCREASE SG EX See Note)

Impact

The bill's impact on state laws is significant, as it introduces a mechanism for ensuring that political subdivisions cannot further indebts themselves while they have outstanding judgments. It establishes the requirement for a filed notice of eligible judgments with the State Bond Commission, thereby creating a systemic check on the financial activities of local governments. The provisions aim to align the obligations of these subdivisions with the principles of accountability and fiscal responsibility.

Summary

Senate Bill 499, proposed by Senator Riser, aims to regulate the issuance of bonds and other forms of indebtedness by political subdivisions. Specifically, the bill prohibits the State Bond Commission from approving such financial instruments for any political subdivision that has unpaid, final, nonappealable judgments filed against it. These judgments must be related to services performed under contractual obligations. This legislation intends to ensure that public entities address their debts before seeking additional financing, promoting responsible fiscal management.

Sentiment

Overall sentiment surrounding SB 499 appears to be supportive among legislators who emphasize the need for fiscal responsibility among local governments. Proponents argue that it is essential for maintaining the integrity of public finances and ensuring that entities prioritize addressing their debts. However, there may be concerns regarding the potential implications for political subdivisions unable to secure funding for essential services while under legal judgment restrictions, which some could perceive as punitive.

Contention

Notable points of contention involve the definitions of 'eligible judgment' and the exemptions outlined in the bill. Some discussions highlight potential overreach in restricting funding access for certain smaller political subdivisions, especially those that may struggle to fulfill prior contractual obligations due to circumstances beyond their control. Additionally, the precise criteria for judgment exemptions, particularly concerning specific parishes and municipalities, may lead to debates about fairness and equitable treatment of various local governments.