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Regular Session, 2014
HOUSE RESOLUTION NO. 223
BY REPRESENTATIVE BARROW
A RESOLUTION
To urge and request the House Committee on Municipal, Parochial and Cultural Affairs to
study and make recommendations relative to the duties and responsibilities that fiscal
administrators have while investigating the financial stability of political
subdivisions of the state of Louisiana.
WHEREAS, the Great Recession has caused a significant decrease in state aid to
local governments and during the same time period property tax revenues also have
declined; and
WHEREAS, the loss of revenue has had a devastating impact on local governments
as the demand for government services has increased, driven by consistently high
unemployment rates, population changes, and other factors; and
WHEREAS, many local governments, including some of the nation's largest cities,
are facing heightened fiscal stress and are unable to meet their financial responsibilities
causing some to file for bankruptcy; and
WHEREAS, over the years, several states have been proactive in establishing
intervention programs in order to help local governments avoid financial disaster while
others have held to a long-standing tradition of leaving it up to local officials to fix their
broken finances; and
WHEREAS, R.S. 39:1351 et seq. requires the attorney general, to file a rule to
appoint a fiscal administrator for a political subdivision of the state of Louisiana if the
legislative auditor, the attorney general, and the state treasurer decide that a political ENROLLEDHR NO. 223
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subdivision is reasonably certain to not have sufficient revenue to pay current expenditures,
excluding civil judgments, or to fail to make a debt service payment; and
WHEREAS, R.S. 39:1351 et seq. requires the court to appoint a fiscal administrator
when a political subdivision has failed to provide an audit required by law to the legislative
auditor for a period of three consecutive fiscal years; and
WHEREAS, R.S. 39:1351 et seq. grants the fiscal administrator, subject to approval
of the court, authority to direct all fiscal operations of the political subdivision and to take
whatever action he deems necessary to return the political subdivision to financial stability
including the authority to appoint, remove, supervise, and control all personnel and to
reorganize, consolidate, or abolish departments, commissions, authorities, boards, offices,
or functions; and
WHEREAS, R.S. 39:1351 et seq. requires the fiscal administrator to file a report with
the court after his investigation containing specified estimates, proposals, and
recommendations and to file other reports the court requires; and
WHEREAS, House Bill No. 1164 of the 2014 Regular Session of the Legislature
proposes to amend R.S. 39:1352(A)(3)(h) and to repeal R.S. 39:1352(A)(3)(e) in order to
limit the powers granted to the fiscal administrator by authorizing him to appoint, remove,
supervise, and control all personnel only if he takes action to reorganize, consolidate, or
abolish departments, commissions, authorities, boards, offices, or functions; and
WHEREAS, House Bill No. 1164 of the 2014 Regular Session of the Legislature also
proposes to amend R.S. 39:1352(A)(1) and (B)(1) to require the fiscal administrator, during
his investigation, to file a written status report with the political subdivision on the last day
of each month and further to require him to complete his investigation within six months if
the political subdivision has an annual budget of five hundred thousand dollars or less; and
WHEREAS, although the state of Louisiana has a vested interest in the financial
stability of its local governments, the state should be careful not to infringe upon the rights
of the citizens of its local governments by granting too much power to fiscal administrators
and taking too much power away from the local officials elected by those citizens and
arguably leaving them without representation. ENROLLEDHR NO. 223
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THEREFORE, BE IT RESOLVED that the House of Representatives of the
Legislature of Louisiana does hereby urge and request the House Committee on Municipal,
Parochial and Cultural Affairs to study and make recommendations relative to the duties and
responsibilities that fiscal administrators have while investigating the financial stability of
political subdivisions of the state of Louisiana.
BE IT FURTHER RESOLVED that the committee shall report its findings and
recommendations to the legislature not later than sixty days prior to the convening of the
2015 Regular Session of the Legislature.
SPEAKER OF THE HOUSE OF REPRESENTATI VES