July 11, 2002

I. CALL TO ORDER\ROLL CALL:

The Louisiana Advisory Commission on Intergovernmental Relations met on July 11, 2002, in Senate Committee Room E.
Chairman Harris called the meeting to order and asked the Secretary to call the roll. The following was noted:

MEMBERS PRESENT                                                     MEMBERS ABSENT
Ronnie Harris                                                                     Bobby Simpson
Representative Dale Erdey                                                  Senator Boissiere
Lenwood Broussard                                                           Senator Johnson
Timothy Roussel                                                                 Senator Romero
Mike Zito                                                                           Representative Weston-Broome
Bill Miller                                                                            E.G. Randolph
Arthur Cooper                                                                    Ms. Johnnye Kennon
Ellen Rhorer                                                                       Joel Richert
Blaise Carriere                                                                   Clarence Savoie

SENATE STAFF PRESENT
Jerry Guillot
Tim Prather
Yolanda Dixon
Peggy Russell
Sabrina Whitaker
Tammy Crain-Waldrop
Betty Boudreaux
Lynda Middleton
Nancy Vicknair
John Keller, Sgt-at-arms

II. RECEIVE COMMITTEE REPORTS

Mike Zito, Chairman of ACIR subcommittee on Education, Health, Social Services and State Fees addressed members and began his report. He stated that presentations were given by Dr. Bill Miller and Ms. Marilyn Langley of the State Department of Education and Mr. Ron Wascom of the School Board Association.

• Basic Educational Statistics - Constitutional requirement exists to "establish and maintain a public educational system"
• There are 66 Public School districts, 64 are parish systems; 2 are city systems (Bogalusa and Monroe)
• 1,532 Public Schools in Louisiana with 741,553 students
• 386 Nonpublic Schools with 138,956 students
• Average Teacher Salary - $35,170
• Average state expenditure per student - $5,814
• Division of revenue:
  • 49% from state
  • 39% from local
  • 12% from federal sources

Overview of MFP (Minimum Foundation Program) Basically - state funds are apportioned to local school systems based on Relative Fiscal Capacity and proportion of Weighted Students.

• Source of state funding
• Determination of local allocation considers:
• Weighted students - number of students; number with free or reduced lunch; number with exceptionalities; number of gifted/talented; number in vocational ed courses; district size less than 7500 students.
• Base cost - base cost per student multiplied by the number of weighted students. (Fiscal Year 2002, $3,188; Fiscal Year 2003, increase to $3,276)
• Local fiscal capacity based on all revenue sources including both property and sales tax. (Consideration is given to other sources of funding available to locals such as lease of school lands for revenue)
• Level 2-Provides rewards to School Boards which exceed their local share.

Use of MFP funds:

• 70% of the local general fund must be spent on direct classroom student and instructional support.
• Beginning in FY 03, the MFP will require 50% of any increased Level 1 or Level 2 funding to go to certified salary increases.
• MFP does not consider capital outlay or debt needs of local school boards

Good Aspects of MFP

• School boards have some flexibility in spending decisions
• Relative fiscal capacity is measured more accurately
• Accountability program is working and improved student performance can be measured

Concerns and Issues which need to be addressed

• Federal & State Mandates:
  • School boards are excluded from restriction on unfunded state mandates
  • Statute and policy dictate many resource inputs such as class size, minimum salary levels, support service levels.
  • Percentages of increases in MFP funding are frequently mandated, such as teacher salaries
  • Federally mandated programs for special education - federal funding anticipated to be at 40% has only been 13%
• Base pupil amount has not kept up with inflation
• Legislators are not willing to accept the flexibility aspects of the MFP
• Sales tax and industrial tax exemptions place a burden on some local governments and locals cannot voice objections
• Homestead Exemption - local governments are topped out on sales tax and homestead exemption may be a place to look with dedication to education
• Educational costs are higher to address poverty - Louisiana has highest percentage of poor children of all states
• State reimbursement for group insurance has been moved to the MFP

Mike Zito concluded his report. Bill Miller noted that he would answer any questions regarding the synopsis of the subcommittee report on comments that were offered.

Mayor Harris thanked Mr. Zito for his report. He then asked for the report from the General Services subcommittee.

Mr. Arthur Cooper, designee for Don Hutchinson, presented the General Services subcommittee report. He advised that a hearing was conducted relative to labor issues on June 13, 2002. Although the committee lacked a quorum, testimony was taken from Ms. Alicia Wilkins, Deputy Secretary, Department of Labor and Ms. Sujuan Boutte, Assistant Secretary, Department of Labor.

Workforce Investment Act
A major program which is federally funded, approximately $60-$70 million annually. Such funds are used for local workforce investment areas. The program provides training and employment services for dislocated workers.

Incumbent Worker Training Program
A state program funded by the diversion of $50 million from employer taxes. Provides skill development for an employer=s existing employees.

Welfare to Work Program
A federal/state program. Program designed to help long term public assistance recipients move from public assistance into workforce.

Trade Adjustment Assistance Act
A federal/state program. Provides re-training and re-employment services for individuals that have been employed in the state but have lost their jobs due to increased imports, ie: business moving overseas.

Job Service Offices
Offices located throughout the state which provide one-stop employment centers under the Workforce Investment Act. The program connects job applicants with certain skills with employers who are looking for such specifically trained employees.

Mayor Harris thanked Mr. Cooper for his report. He advised that there was one more report, from Public Works and Judicial Systems.

Blaze Carriere presented the report on Public Works and Judicial Systems. A summary of the report is as follows:

The Public Works and Judicial System Subcommittee addressed the funding of the offices of District Court Judges and District Attorneys during its June 10, 2002 meeting. Testimony was provided by the following:

• Pete Adams, Executive Director, District Attorneys Association
• Judge Ronnie Cox, Judge, 15th J.D.C., District Judges Association
• Daryl Schulz, Deputy Judicial Administrator, La. Supreme Court
• Doug Hebert, President, District Attorneys Association

Judge Cox explained that the District Courts have three sources of funding: parish funding, which provides offices, furniture and utilities; state funding which pays the salaries of the district judges and an Office Expense Account of $5,000 per year; and self-generated funds. The self-generated funds include the Criminal Court Fund, which is funded through criminal court fines and bond forfeitures (shared with the district attorney), the Judicial Expense Fund which is funded through fines on civil and criminal filings, and the Non-Support Fund or the Support Enforcement fund, which is funded through a percentage from collections from support enforcement claims.

Judge Cox stated that in Lafayette Parish, which is a typical judicial district, the Criminal Court Fund generated $413,000, but paid expenses of $569,000. The funds pay expenses which the state or parish government no longer pay, for example, law books, computers, insurance on computers, computer supplies, copy a fax machines, postage, law clerks' insurance, law clerks' CLE, telephone bills, cell phone bills, replacement court reporters, parking, jury meals and security.

Darryl Schulz provided information from his experience as a former administrator for a district court. He stated that local government, although required to fund and maintain the district courts, are not able to keep up with the demands and problems of the courts. Budgets for the judiciary are not increasing, but crime and litigation is expanding and growing. Because of this, the self-generated funds are used to finance the operations of the courts that the locals can not provide. Throughout the forty-one judicial districts, the level of local funding varies. Therefore, there is no district that is funded exactly like another. There is also no standardization as to what happens with the money in the funds, neither is there standardization on the numbers of staff. Some Courts have no law clerks. Additionally, some of the courts pay for the operations of other offices. For instance, in Orleans Parish, the Orleans Traffic Court self-generated fees pay for the operation of the Indigent Defender's office. He also stated that the judiciary budget is approximately .6% of the entire state budget, approximately $100 million, and about $25 million of that is federal funds dedicated for special programs. In a number of cases there are courts who have added on to their buildings/courts and paid for the construction out of their judicial expense funds because they needed to expand, and local government could not afford to fund the expansion.

Pete Adams, Executive Director for the District Attorneys Association, provided a handout explaining the funding mix for district attorneys. He also highlighted the fact that every judicial district in the state is different from every other judicial district. There are eight three-parish districts and seven two-parish districts; the remainder are single parish districts. The relationships between the parish governing authorities and each of those parishes varies from district to district.

The basic funding is as follows: the state pays a base pay for the district attorney and his assistants. The number of assistants are provided for by statute. The district attorney, may, on his own authority, commission as many assistant district attorneys as he desires. However, these assistants are not eligible for state pay, and does not obligate locals to pay for them, unless they are determined to be a reasonable and necessary expense. The base pay for the district attorney is $50,000 per annum, and the base pay for assistant district attorneys is $30,000.

The state also pays for the Victim Assistance Coordinators in each district, the number of coordinators is based on population. These coordinators provide assistance to victims and their families throughout the entire criminal justice process and facilitate the delivery of victims' service and rights as provided by law. The state pays $25,000 per Victim Assistance Coordinator. Any supplement for pay comes from other sources.

Mr. Adams explained that Reed v. Washington Parish Police Jury, 518 So. 2nd 1044 La. 1988, is the current status of the law with regard to funding of the office of the district attorney's office. In that case, the court ruled that the police jury's financial obligation is all reasonable and necessary expenses for the salaries, operations, and travel for the District Attorney and his employees.

The district attorneys have certain self-generated revenue from court costs and fees, which are statutorily mandated, and which go directly to the operations of the offices of the district attorneys. The criminal court fund was created to assist in funding the district attorney, courts, and law enforcement in criminal justice activities. The funds initially did very well, however, the list of expenses borne by the fund has grown dramatically. Additionally the reliability of the fund as a source of revenue is also at issue if the defendant has no ability to pay, a judge refuses to order the fine or police issue fewer tickets.

Both Mr. Hebert and Mr. Adams indicated that the district attorneys were reluctant to recommend a state appropriated funded system for district attorneys, and believe that the district attorneys need adequate, independent sources of funding.

Local Public Building/Housing Costs and Expenses:
The following were determined to be public building/housing costs which local governments must pay in response to state mandate or to house the following public officials:

Next Steps
The subcommittee would like to look at "model court" systems, and standardization of each district with regard to employees, etc. The committee will continue to look at the funding of the judicial system.

Mayor Harris thanked Mr. Carriere and subcommittee members for their reports. He asked Mr. Carriere if he knew when or how the locals ended up funding the state courts. Mr. Carriere advised that Mayor Simpson led the discussion on the issue, trying to understand what is the responsibility of the local unit of government. The logic seemed to be, here are the things we need to do judicially, the customers that are generated by that typically are the local people, so as a consequence, funding of that is a local responsibility. At the local level, it is seen as a mandate from someone telling you that you have to do something. He advises he was amazed at listening to the administrators in particular, telling of innovative ways in which they raise self-generated funds.

II. OTHER BUSINESS

Mayor Harris made note of the Revised ACIR "Timeline" contained in each member folder. Mr. Guillot explained what occurred this year; the legislative resolution which the legislature initiated to call ACIR together to begin the study would have ended this past spring. Representative LeBlanc introduced and passed a second resolution to continue the study until 2003; although the resolution states that the report has to be ready 60 days prior to the 2003 Regular Session. Therefore pursuant to this resolution, the commission needs to finish it's business by January. He further stated that it would be an aggressive approach to try and accomplish this, as the purpose is for the legislature to receive the report, have time to review the report and have enough time to process drafting of any legislation which they want to pursue in time before the session starts. Mr. Guillot noted that under the general charge of ACIR by statute, the commission has the authority to continue this study. In an attempt to fulfill the request of the resolution by Representative LeBlanc, this was the reason the revised Timeline was submitted.

III. ADJOURNMENT

Mayor Harris adjourned the meeting advising members that each subcommittee would be meeting and accepting testimony.

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Mayor Ronnie Harris
Chairman