Daily Report

This Morning's Headlines / Tue, November 13, 2012


CATS will defeat lawsuit challenging new property tax, officials say

The lawsuit against CATS, calling the bus transportation system's new tax unconstitutional, will be defeated in court because CATS receives taxes other than just property tax, speculates Jared Loftus, the transit system's board president. Brought about by Milton Graugnard, a Cajun Industries executive, the lawsuit says the tax is unfairly levied against property owners within the city limits of Baker and Baton Rouge, while bus riders living outside city limits benefit from the bus service. "Around 85% of this [bus] system is inside city limits," Loftus says, noting that hotel occupancy taxes and monies from the city-parish transportation fund also support CATS. City-parish Assistant Finance Director Linda Hunt says until the new budget was hammered out, about $1.2 million from the transportation fund had gone to CATS for years. But this year—and for the unforeseeable future—about $550,000 is going to CATS. "Now we want to take that money and put it into our bridge-improvement projects," Hunt says of the remaining half million. The occupancy tax for CATS, Hunt says, comes from the state as a sales tax rebate and amounts to about $1.5 million per year. Graugnard's lawsuit has been notable mostly for testimony from the bus system's chief financial officer, Gary Owens, who in court in mid-October said that CATS would operate only two of the eight new express routes promised before the election. However, CATS officials now say Owens was speaking about draft plans and that seven of the eight routes will be operational. —Adam Pearson

DDD approves 2013 budget, looks at possible expansion

The DDD Commission approved a $620,070 budget for 2013 this morning, a slight increase over the agency’s $613,520 budget for 2012. The new budget total could go up again in the near future, as the legal framework is in place for an expansion of the DDD that could include residential neighborhoods to the east and south of downtown as well as 120 acres of industrial parcels just north of downtown. To see the proposed new boundaries, click here. "Option 1 expansion" has been approved by the Legislature, except for the fact that the eastern boundary would end at the Kansas City Southern rail line (the map shows the boundary jutting past the rail line in two locations). DDD Executive Director Davis Rhorer says an extensive outreach and discussion process is planned with property owners in the potential expansion areas, with a vote possible sometime next year. In the strategic plan, an additional $312,000 was envisioned, but that estimate incorporated higher tax rates that are no longer under consideration. Rhorer says he isn’t sure what the new number might be, but that it likely would be less than half the original $312,000 estimate.

Editor: Is the Red Stick turning blue?

When Democrat Kip Holden was elected mayor of East Baton Rouge Parish in 2004 on his third try, it was written off as something of a fluke, says Business Report Executive Editor JR Ball. "He was merely the benefactor of the 'anybody but Bobby [Simpson]' crusade," Ball writes in his latest column. And when Holden became the first mayoral candidate in parish history to win all 315 precincts in the 2008 election, Ball notes the landslide was declared a testament to Walter Monsour, "the mayor's get-it-done CAO and his conduit to the white, conservative business community." But Ball says there's a different explanation for the results of last week's election, in which Holden—absent Monsour and despite steadily declining popularity—was easily re-elected to a third and final term, with 60% of the vote. "The explanation, this time, was that many south Baton Rouge white voters decided four finite years of Kip was better than a potential dozen with Mike Walker, the fear-mongering, race-baiting Republican main challenger," Ball says. "Yet there's also something else at play: a parish that's demographically and politically transmogrifying." Read the full column here. Send your comments to [email protected].

Jindal: GOP needs to end 'dumbed-down conservatism'

Gov. Bobby Jindal on Monday called on Republicans across the country to "stop being the stupid party" and make a concerted effort to reach a broader swath of voters with an inclusive economic message that pre-empts efforts to caricature the GOP as the party of the rich, Politico reports. In his first interview since his party's electoral thumping last week, Jindal urged Republicans to reject anti-intellectualism and to embrace a populist-tinged reform approach that he says would have mitigated what exit polls show was one of President Barack Obama's most effective lines of attack against Republican challenger Mitt Romney. "We've got to make sure that we are not the party of big business, big banks, big Wall Street bailouts, big corporate loopholes, big anything," Jindal told Politico in a 45-minute telephone interview. "We cannot be, we must not be, the party that simply protects the rich so they get to keep their toys." He was just as blunt on how the GOP should speak to voters, criticizing his party for offending and speaking down to much of the electorate. "It is no secret we had a number of Republicans damage our brand this year with offensive, bizarre comments—enough of that," Jindal says. "We've also had enough of this dumbed-down conservatism. We need to stop being simplistic, we need to trust the intelligence of the American people and we need to stop insulting the intelligence of the voters." Read the complete story here.

Report: La. school districts have not vouchers but themselves to blame for budget woes

While a number of school districts have raised concerns that they will face financial hardships if students choose to participate in the new voucher program and attend private schools, a new report from The Pelican Institute for Public Policy says that it's not vouchers that are creating budgetary woes for these districts. Rather, citing a study by the Friedman Foundation for Education Choice, the Pelican Institute says the districts have only themselves to blame. "Public school employment has far outpaced K-12 student enrollment. This trend is particularly stark in Louisiana, where the number of students declined by 13% between 1991 and 2009," reads the report. "Despite this decline in students, the number of total school personnel actually increased by 11%. The number of teachers increased by 9% and the number of non-teaching administrators increased by 13%." You can check out the full report here.

Most Americans would feel some hit from the 'fiscal cliff'

Everyone who pays income tax—and some who don't—will feel it. So will doctors who accept Medicare, people who get unemployment aid, defense contractors, air traffic controllers, national park rangers, and companies that do research and development. The package of tax increases and spending cuts known as the "fiscal cliff" takes effect in January unless Congress passes a budget deal by then. The economy would be hit so hard that it would likely sink into recession in the first half of 2013, economists say. And no matter who you are, it will be all but impossible to avoid the pain, they add. Middle-income families would have to pay an average of about $2,000 more next year, the nonpartisan Tax Policy Center has calculated. Up to 3.4 million jobs would be lost, the Congressional Budget Office estimates. The unemployment rate would reach 9.1%, up from the current 7.9%. Stocks could plunge. The nonpartisan CBO estimates the total cost of the cliff in 2013 at $671 billion. Collectively, the tax increases would be the steepest to hit Americans in 60 years when measured as a percentage of the economy. Most of the damage—roughly two-thirds—would come from the tax increases. But the spending cuts would cause pain, too. The bleak scenario could push the White House and Congress to reach a deal before year's end. Today, Congress returns for a post-election session that could last through Dec. 31. Read the full story from The Associated Press here.

Today's poll question: Do you think Congress and President Barack Obama will be able to reach a deal to avoid the "fiscal cliff" by Dec. 31?

News roundup: Entrepreneurship week continues with BRAC networking event … Retailer h.h.gregg to open first B.R. store Thursday … March of Dimes gives Louisiana an 'F' for premature birth rate

Handshakes and smiles: Baton Rouge Entrepreneurship Week, which kicked off Monday evening, continues today with a networking event at Hollywood Casino from 5 to 8 p.m. "This new high-speed networking format will allow investors to interact with a large number of attendees in a short period of time," BRAC says, adding: "You have not networked like this before." Cost is $5 for BRAC investors, $10 for all others. Tickets for this event—as well as all the others occurring this week in conjunction with BREW—are available online here.

Getting plugged in: Indianapolis-based appliance and electronics retailer h.h.gregg announced today the grand opening of its first Baton Rouge store on Thursday at 10 a.m. The store, which is also the chain's first in Louisiana, is located in the Mall of Louisiana off Bluebonnet Boulevard; two more stores are slated to open in New Orleans on Nov. 15. A release from h.h.gregg says LSU cheerleaders will be on hand to give away prizes to the first 300 people who visit the store.

Weak start: The March of Dimes today issued the grade of "F" to Louisiana for having too many premature births. The report card defines a premature birth (also called preterm birth) as one occurring before 37 weeks of pregnancy. According to today's report, the three factors measured on the March of Dimes Premature Birth Report Card are: smoking among women of child-bearing age, lack of insurance among these women, and late premature births (those that occur between 34 and 36 weeks gestation). The report card includes data from the National Center for Health Statistics showing Louisiana's premature birth rate is 15.6 %. Louisiana was one of three states, along with Mississippi and Alabama, to get an "F." See the full report here.

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