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2013 June 24 - 12:00 am

POLITICS & POLICY: La. Colleges Prevail Over Regents in Funding Fight

BATON ROUGE, La. (AP) — Louisiana’s community colleges have won their dispute with other higher education leaders over construction spending.

The Senate gave final passage to a measure that will let the Louisiana Community and Technical College System sidestep the traditional construction budget process, called “capital outlay,” for a list of projects totaling nearly $252 million.

Final approval in a 27-4 vote came despite opposition from the Board of Regents, which oversees all higher education in the state, and Commissioner of Higher Education Jim Purcell.

The bill by Sen. Robert Adley, R-Benton, heads to Gov. Bobby Jindal, who supports it.

Supporters said the projects will help beef up worker training in the state, to meet the job demands of industry and to aid economic development efforts.

“These schools are a critical pipeline for workforce needs, and we are proud to fund them however we can,” Jindal spokesman Sean Lansing said in a statement about the proposal.

The Board of Regents said the bill violates a constitutional process for college construction in which campuses submit their needs to the board, which prioritizes and submits the list, and sets up a new, politicized competition for money between colleges.

“When you’re flying in formation, the strength is everyone staying together for the mission,” Regents Chairman Clinton “Bubba” Rasberry told lawmakers during a committee hearing on the bill.

Purcell said the four-year universities have construction needs, too. He said deferred maintenance needs at Louisiana’s college campuses top $1.7 billion, and he said the community and technical college system never presented to Regents the list of projects included in the bill.

Treasurer John Kennedy also opposed the bill, saying spending outside the construction budget process will breach the state’s debt cap.

Adley said the state has previously borrowed outside the capital outlay process for the community college system. He was joined by local mayors and other local officials from around the state who advocated for the project borrowing.

LCTCS President Joe May said the money will help meet “an explosion of demand” at the community colleges and technical schools.

“We’re seeing a literally almost explosive growth in some areas of the state, and what we have to do is ratchet up our training programs to meet those needs,” May told lawmakers during House Appropriations Committee discussion of the bill.

The construction dollars will be doled out beginning in 2015.

Borrowing will be paid back over up to 30 years and will require the approval of the State Bond Commission. Before the bonds can be sold to generate upfront cash for the projects, at least 12 percent of the project cost will have to be matched with private dollars.

The state will have to pay the rest of the repayment costs. Legislative fiscal analysts estimate that could cost about $20 million a year for two decades.

The borrowing won’t count in calculating the state debt load that is limited with an annual cap on debt, according to the bill. But Kennedy said he believes the bond rating agencies will still view the debt as busting the state’s debt ceiling.

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