Senator Allain: Administration could empty Artificial Reef Fund

Bill to extend constitutional protection to the fund advances in Louisiana Senate.

If the administration of Gov. Bobby Jindal moves forward with a $20.6 million transfer from the Artificial Reef Development Fund to fill holes in its budget for the next fiscal year that commences July 1, the administration will almost certainly come up short, the Senate Finance Committee was told today.

According to Sen. Bret Allain (R-Franklin), the Artificial Reef Fund is projected to total somewhere in the neighborhood of $14 million by the time the administration would be prepared to initiate its transfer, assuming the House and Senate go along with the budget proposal.

The administration, however, is planning to account for that, Allain told the committee.

“We will end up with a balance of zero in the fund,” he said. “Nothing to work with.”

“You’re basically going to have to start from scratch,” added Sen. Fred Mills (R-Parks).

House Bill 452 by Appropriations Chairman Jim Fannin (D-Jonesboro) would trigger the moving of cash from the reef fund, along with several other dedicated funds, to the budget. The legislation’s first scheduled hearing is with the the House Appropriations Committee Monday at 9 a.m. in Room 5 of the State Capitol in Baton Rouge.

Jindal’s budget has a $1.3 billion revenue shortfall, and the reef fund has been a giving target for the administration in the past when that has happened — amounting to $45 million taken from the fund since the 2009-10 fiscal year.

In an effort to guard against future raids, Allain advanced legislation through the Senate Finance Committee today that recreates the reef fund as a constitutional program. It’s currently in state statute, making it easier for the administration and lawmakers to approve such financial raids.

If Senate Bill 128, a proposed constitutional amendment, is approved by the Legislature, voters will have their say on the Nov. 4, 2014, ballot. If it’s subsequently enacted, the administration would still be allowed to withdraw money from the fund when crafting its 2014-15 budget next spring, if it chooses to do so and the Legislature endorses the move.

Allain’s bill, which was approved unanimously, brought diverse players to the table in support, including the Coastal Conservation Association, Louisiana Oil and Gas Association, and the Louisiana Wildlife Federation.

The Rigs-to-Reef program supported by the fund helps energy companies avoid the costs of decommissioning rigs — part of the savings are donated to the fund — and pleases conservationists by creating sustainable underwater habitats.

The fund transfers, both past and pending, aren’t as popular.

The Louisiana Wildlife and Fisheries Commission, appointed fully by Jindal, is considering litigation over past transfers and the latest planned raid if approved, but members say the administration has offered to find a way to repay the money. Negotiations are ongoing, they say, although many are skeptical.

On the agenda for its next meeting May 2, the commission has included a discussion on the “prospective litigation” in executive session, meaning behind closed doors.

Commission members argue the money donated to the reef fund is not intended for other areas of the state budget, which could be the foundation for its potential lawsuit.

Moreover, Louisiana Wildlife Federation Executive Director Rebecca Triche said during Allain’s Senate committee hearing that an argument can be made that the donations and fees paid into the fund are already protected by Louisiana’s guiding charter.

“The donations are made to the Conservation Fund, which is constitutionally protected,” Triche said.

The Louisiana Department of Wildlife & Fisheries oversees the Conservation Fund, from which money for the reef fund is appropriated.

In an earlier interview, Garret Graves, chairman of the Coastal Protection and Restoration Authority, said the Jindal administration has been aggressive in pursuing money for artificial reef creation through the state’s capital outlay program, coastal Master Plan and other avenues. Graves said that spending on artificial reef projects has increased by more than 700 percent Since Jindal took office, and that commitment will not change.

Allain’s legislation will be heard next by the full Senate, which has not yet scheduled it for debate.

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