By Luke Britt/Editor
The Union Parish Police Jury, in a special meeting on Tuesday, voted to bring back to Union Parish more than $2 million that currently is invested with the Louisiana Asset Management Pool (LAMP).
Also on Tuesday, the jury acted on the following:
- Voted to approve the 2023 Tax Roll as submitted by the parish Tax Assessor.
- Approved the transfer of up to $685,000 to the parish road fund.
- Increased the number of personal days allotted to parish employees.
- Voted to allow parish employees to sell a limited amount of unused vacation time back to the parish.
- Agreed to include in next year’s budget money to hire a new fulltime vehicle mechanic.
- Approved an agreement with the state Department of Transportation and Development that provides matching funds for a new taxiway at the Farmerville airport.
- The Jury called the special meeting to fulfill its annual duty of reviewing the tax rolls prepared by the offie of Tax Assessor and hearing any appeals filed by businesses that wish to dispute their tax assessment.
Tax Assessor Lance Futch told the jury that only one appeal was submitted and that appeal was received weeks after the appeal deadline had passed. The Jury voted to reject the appeal and accept the tax rolls as determined by Futch’s office.
Juror Dwayne Ramsey, D-3, during the Police Jury’s Sept. 5 regular meeting, proposed transferring $2 million from the LAMP fund to Louisiana National Bank after learning, he said, that LNB would pay an interest rate similar to what the parish is earning from LAMP.
LAMP is a program that allows Louisiana public entities of all types – municipalities, police juries, retirement systems, hospitals and others – to pool their money in a single investment account so they may benefit from the higher interest rates, lower fees and investment management services normally only available to large institutional investors.
According to the LAMP 2022 financial statement, 766 Louisiana government entities have invested more than $3.6 billion in the fund. That financial statement also shows that the vast majority of LAMP money is invested with banks and corporations outside Louisiana, and in many cases, outside the United States.
Ramsey reasoned that a local bank would invest the money locally in the form of personal and business loans, benefitting Union Parish residents rather than an out of state bank or corporation.
Following the Sept. 5 meeting, the jury asked LNB, Marion State Bank and Origin Bank whether they could compete with the investment return of 5.35 percent the parish currently earns with LAMP.
On Tuesday, the jury discussed the following proposals:
LNB proposed a variable interest rate linked to the Federal Reserve System’s federal discount rate. The Fed rate currently is 5.5 percent, which LNB’s Brandon Norris said would generate interest of 5.38 percent for the parish. That rate will rise or fall in lockstep with the rate set by the Federal Reserve System.
Origin Bank proposed a fixed rate of 5.13 percent that the bank would guarantee through January 2025, at which point the parish and the bank would need to renegotiate the interest rate.
MSB offered a variable interest rate of 4.805 percent.
While LNB offered the highest rate, jurors Ben Bridges and Nathan Pilgreen expressed concern about the variable nature of that rate. For much of the past fifteen years, during which a recession and the COVID pandemic tanked the U.S. economy, the federal discount rate was close to zero.
While the Fed rate has bounced back, Pilgreen and Bridges said they were concerned that the parish might take a financial hit should the Fed cut its rate significantly. Both jurors said they preferred the lower, but guaranteed, fixed rate offered by Origin Bank.
On Sept. 20, the Fed predicted at least one more interest rate increase before the end of the year and said it doesn’t anticipate cutting rates until the end of 2024. The Fed is not bound by that prediction, however. An unforeseen economic crisis could result in unexpected rate cuts.
“I think the known is better than the unknown,” Pilgreen said. “I didn’t get a variable rate on my home on the fear of, what if.”
LNB’s Norris tried to allay those fears by telling the jury that, should the Fed cut rates unexpectedly, moving the account to another institution would be as simple as, “a phone call and a wire transfer.”
In the end, Bridges and Pilgreen were on the losing end of a 6-2 vote to transfer most the LAMP account’s $2.4 million to LNB.
In other business
The Jury agreed to transfer up to $685,000 to the parish road maintenance fund between now and the end of the fiscal year. The funds will not be moved at once, but as needed to keep the fund in the black.
The jury voted to increase the number of personal days parish employees can take in a year from two days to five days. Employees do not have to provide an explanation or advance notice to take a personal day, unlike sick days which require written verification of illness from a physician.
The jury also approved a motion to establish a 30-day period between Nov. 15 and Dec. 15 of each year during which employees can “sell” up to 40 hours of unused, accrued vacation back to the parish.
The jury also approved an agreement with the state Department of Transportation and Development that provides $62,316 toward construction of a new taxiway at the Union Parish airport. The funds represent the state’s match to a $535,000 federal grant for the taxiway project.