ATLANTA -- Marking the first major legislative victory for New Orleans' recently elected Mayor Marc Morial, Louisiana lawmakers last week passed a bill that increases the city's general obligation debt limit by about $90 million.
Under Senate Bill 15, sponsored by Sen. Dennis Bagneris, D-New Orleans, the city will be able to base its bond ceiling on 10% of assessed property valuation. The method, used by other local governments in the state, will raise New Orleans' bond limit from $500 million to about $590 million, according to city officials.
The House of Representatives passed the legislation by a 96-to-4 vote last Tuesday. The Senate approved the bill the preceding week.
"This bill is very important because projects in the city need to be done that couldn't be financed under the old bond limit," said Rep. Ed Murray, D-New Orleans, who sponsored a companion bill in the House of Representative. Murray said that the city hopes to put together a list of bond projects to be brought before voters in an Oct. 1 referendum
Murray said that Gov. Edwin Edwards is expected to sign the bill tomorrow in Baton Rouge.
Morial, a former state senator, succeeded Sidney Barthelemy as New Orleans mayor on May 2. Morial came into office after winning a bitterly contested runoff in March against lawyer Donald Mintz.
New Orleans has about $429 million of outstanding GO debt. Any bond issued sold by the city must be approved by state voters. The city GO debt is rated A-minus by Standard & Poor's Corp. and Baa by Moody's Investors Service.
Meanwhile, two other bills involving debt issuance in New Orleans are nearing passage.
House Bill 444, sponsored by Rep. Sherman Copelin, D-New Orleans, would permit the sale of about $100 million of revenue bonds to expand the city's convention center. The bonds, which city officials say are needed to finance part of a $274 million expansion and renovation of the center, would be backed by additional tourist taxes and fees.
Specifically, the bill would extend for 30 years the 2% hotel occupancy tax and separate hotel fee schedule now in effect. The taxes bring in about $8 million a year
In addition, the bill would impose a $1 per person fee for tour tickets and 2% tax on vendors who set up booths at the Louisiana Superdome and Convention Center. The new levies would bring in about $1 million a year, according to legislative sources.
The House approved the bill on May 10.
Louisiana's legislature is considering a bill that would give the Greater New Orleans Expressway Commission the ability to sell about $70 million in bonds to cover renovation of the Lake Pontchartrain causeway.
Senate Bill 36, which is sponsored by Sen. Ken Hollis, R-Metairie, was passed last Monday by the Committee on Revenue and Fiscal Affairs and by the full Senate on Wednesday.
In other legislative matters, the full Senate is will begin debate today on its version of the fiscal 1995 state budget. The fiscal year begins July 1.
Two weeks ago, the House passed a $11.75 billion all-funds budget for fiscal 1995 that calls for no new taxes.
Last week, the Senate approved legislation, already passed by the House, to renew sales taxes on food and utilities that will otherwise expire June 30. The taxes generate about $400 million a year.
If the bill had not passed, legislators would have been forced to scramble to make up for the lost revenues, John Carpenter, general counsel to House Ways and Means Chairman Steve Theriot, D-Marrero, said Friday.
Carpenter said that after the Senate completes the budget, he expects it will take up a capital outlay bill that would limit state general obligation bonds in fiscal 1995 to $200 million. The House has passed its version of the bill, which includes the $200 million bond cap.
The legislative aide said that he expects the legislature to complete its business by the end of the week.
