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A taxing takeover

A state takeover of four East Baton Rouge Parish public schools would represent bad publicity for the system no matter when it happened. But the timing of the recent announcement that the state will take the reins of Prescott Middle, Glen Oaks Middle and both Capitol Pre-College academies after years of low performance scores couldn’t have been worse for schools officials. On March 8, voters who live within the district will have the option to renew, or eliminate, a one-cent sales tax the superintendent says is crucial to the success of local schools.

“Anything that’s not necessarily positive could have an adverse impact,” schools superintendent Charlotte Placide says. “We have 10 years of a good solid track record [of using the tax money]. Hopefully the public feels we did what we said we would do.”

The system couldn’t afford to build a new school for more than three decades, and could barely afford maintenance; since the tax was first passed in 1998 and renewed in 2003, they’ve built seven schools and repaired others. This time, the system is asking for a 10-year renewal, in part to handle the cost of replacing Lee High School and renovating Baton Rouge Magnet High School [pictured]. The tax is expected to raise more than $800 million. The district has a surplus of $56 million, some of which will go to facilities, but prefers to save some of the surplus for an emergency and not spend it on recurring expenses, Placide says.

The tax is split into three propositions on the ballot. Fifty-one percent would be dedicated to facilities and technology, 41% for employee compensation and 8% for discipline programs. The four schools being taken over are still entitled to their share of that money. Placide says the tax funds from 9% to 20% of a teacher’s salary. If the renewal fails, teacher pay will be cut, she says.

“We will lose them, from the district, the state, or the profession,” Placide says.

TaxBusters of Baton Rouge generally doesn’t take stands for or against tax renewals. But TaxBusters spokesman Fred Dent doesn’t consider the March 8 proposition a renewal, since it’s for 10 years, not the five years at a time that voters have twice approved. Dent argues that going five years at a time better allows the public to hold the system accountable for student performance.

“Obviously we don’t have the performance,” Dent says, referring to the anticipated state takeovers. He commended the system for running a surplus, but said the existence of that surplus shows the system might not even need all the money it is getting. Still, he says TaxBusters isn’t planning a formal effort to kill the tax.

There is, however, an organization coming together to push for it. Keep EBR Moving co-chair Eric Lewis says the group plans to meet with various community leaders, and might take out advertising in the near future. Part of the challenge is convincing people who don’t have kids in the public school system to support the tax.

“The perception or reality of the public school system impacts the entire community from an economic development standpoint,” including the city’s property values, Lewis says.

The system is allowed to inform voters as to what the tax has paid for and will pay for, but is not permitted to use tax dollars to directly ask voters to support the renewal. —David Jacobs

Going up [on fares]

One of the benefits about landing a low-cost air carrier is that it forces other airlines to lower their fares, too.

It was one of the reasons Baton Rouge Metro Airport officials desperately wanted a discount carrier, playing up the impact it would have on rates. Lo and behold, when Frontier Airlines began flying between here and its Denver hub, the two other Baton Rouge carriers that offer service to the West lowered their fares substantially—by more than 25%.

Unfortunately, once a discount carrier decides it’s losing too much money in your market and pulls up stakes, market forces release their hold on those other airlines’ fares. Now that Frontier has announced it will discontinue Baton Rouge service in the middle of April—just eight months after it started—chances are slim those other carriers will keep their fares low.

“Come April 14, I would likely anticipate that American and Continental would raise their fares,” airport spokesman Ronnie Pickard says.

Noting that heartbreak isn’t unusual in the discount-carrier game, he adds, “You win some, you lose some. They giveth and they taketh.” —Steve Clark

Finding the way

Not only are they pretty, they serve a purpose. In recent weeks and in the coming weeks, 70 signs⎯including visitor kiosks in Lafayette Park and River Center plaza⎯will be popping up downtown. The $1 million signs are the way-finding component of the downtown visitor’s amenity plan, a partnership between [deep breath]: City of Baton Rouge, State of Louisiana, Housing and Urban Development/Congressman Richard Baker, Federal Transit Administration, Capital Area Transit System, Baton Rouge Area Convention and Visitors Bureau, Arts Council of Baton Rouge and Downtown Development District.

In a variety of shapes and sizes, dispensing a plethora of information, the signs direct visitors [in cars and on foot] to parking, museums, restaurants and other points of interest. There are also new neighborhood identity signs for Beauregard Town and Spanish Town. Some signs even give snapshot histories of the city’s ties to art and music.

Sasaki Associates and WHL Architects were the main consultants on the project, with Covalent Logic designing the illustrative panels. Architectural Graphics Inc. was responsible for the fabrication and contracting.

Don’t want to leave your office to experience these new wonders? No problem [though you should because it’s nice outside]. Click on “Downtown Wayfinding Video” at brgov.com/dept/ddd/. And yes, the Rocky theme is used for a reason. —Marissa Frayer

BUSINESSofPOLITICS

Changing faces: Four Baton Rouge members are facing term limits and two more recently announced they won’t seek re-election, meaning 50% of the panel will consist of fresh faces following this fall’s vote. Metro Councilmen Wayne Carter and Mickey Skyring, both Republicans, could have sought another term, but Skyring contends he is retiring and Carter says he wants to pursue “personal interests.” Carter says that doesn’t necessarily mean challenging Mayor Kip Holden, a Democrat, but speculation persists. As of this month, Carter has about $20,000 in his war chest and donations have halted completely. Records on file with the state Ethics Board reveal Carter, who juiced up his campaign with $278,000 in personal cash, was still paying for services incurred from his failed 2007 bid for agriculture commissioner in late December.

Pushing for answers: It’s now known that Gov. Bobby Jindal, a Republican, is opposed to legislation that would have originally opened up his own executive records to unprecedented public view. Many of the governor’s own stakeholders in his push for ethics reform were asked to comment on his stance, but the only direct answers came from the Public Affairs Research Council, a nonprofit think tank that helped craft some of Jindal’s ethics agenda. Excluding the legitimate need to protect trade secrets and proprietary information as it relates to economic development, all operations should be conducted in the open, PAR opines. The Louisiana Association of Business and Industry, one of the most influential lobbies around, and the Council for a Better Louisiana, another good-government group, opted against offering comments. Blueprint Louisiana and LA Ethics 1, meanwhile, which are supported by powerful business interests, both released statements offering words of support for Jindal’s official agenda, but nothing on the public records bill.

Lobby life: The first few days of the ongoing special session on ethics was chock-full of anti-lobbyist bills, but some of the more personally insulting measures at least to lobbyists stayed put on the docket. Consider the following measures that would truly bring reform, and bitterness, to the legislative process:

• HR8 would prohibit lobbyists from passing notes to lawmakers on the House floor.

• HR9 would force lobbyists to wear special badges.

• HR10 would forbid lobbyists from sitting in seats behind the House floor.

• HR11 would require lobbyists to be sworn in before providing testimony. —Jeremy Alford

Gold standard

Long-time Business Report photographer Marie Constantin was recently honored in the 2008 Advertising Federation of Greater Baton Rouge’s ADDY Awards. For the second year in a row, Constantin won a Best of Show, along with Mesh Design, for the Franciscan Missionaries of Our Lady Health System’s Louisiana Annual Report. In addition to the Best of Show award, Constantin won two golds [for the aforementioned Annual Report as well as the Bishop’s Annual Appeal].

2008 Business Awards & Hall of Fame winners

The winners of Business Report and Junior Achievement’s annual awards will be profiled in the April 8 issue, followed by the 25th annual awards banquet at 7:15 p.m. on Thursday, April 24 at the Holiday Inn Select. Tickets are available through batonrouge.ja.org or 928-7008.

• Hall of Fame Inductee - Charlie Valluzzo (pictured), McDonald’s

• Businessperson of the Year - Lee Domingue, AppOne

• Young Businessperson of the Year - Louis DeAngelo Jr., Louis DeAngelo Restaurants

• Company of the Year (100 or more employees) - Louisiana Workers’ Compensation Corporation

• Company of the Year (fewer than 100 employees) - Window World of Baton Rouge

On the Beat

Wright on: Kerry Drake has been named president of Baton Rouge-based Wright and Percy Insurance, a division of BancorpSouth Insurance Services. Drake previously served as senior vice president for the company’s life, health and corporate benefits division.

Luxury lanes: AMF Bowling Centers is set to launch Avenue E, an upscale bowling alley, and Baton Rouge might be one of the first markets. The company plans to open six to eight locations, featuring first-class bar and restaurant facilities, along with private lanes, party rooms and oversized arcades.

Pinnacle meeting: The city-parish plans to call for a meeting with Pinnacle Entertainment officials before they go to the Planning Commission to address issues such as fire protection, infrastructure and a revenue contract. Pinnacle officials have not set a timetable for when they will go before the Planning Commission for rezoning, but say they estimate the planning and approval process will take six months.

Family affair: Former Gov. Mike Foster has joined the staff of Breazeale, Sachse & Wilson as a governmental affairs specialist. Foster earned a juris doctor from Southern University Law Center, but will not practice law with the firm. His son Murphy is a partner at BSW.

Get out: A report by Men’s Health magazine ranked Baton Rouge 25th in a list of the most workaholic U.S. cities, earning a “D+”. The list is based on a number of factors, including the number of workers, how much overtime is logged, commute times and stress.

Carter scores: Rep. Steve Carter, a freshman Republican, has been elected as head of the Capital Region Legislative Delegation, a group that wants to help metro Baton Rouge get a bigger share of state funding. The delegation meets with representatives from the Baton Rouge Area Chamber, Pennington Biomedical Center, LSU, Mayor-President Kip Holden’s office and the Baton Rouge Area Foundation to determine priorities.

Star alert: Jeff Bridges and Justin Timberlake are set to star in The Open Road, a family drama that will be shot around Baton Rouge, Hammond and other areas. The movie is about a young man visiting his ailing mother and trying to reconnect with his father, a legendary athlete.

Going places: The site of the Baton Rouge Area Chamber’s annual canvass trip has been selected: Richmond, Va. Officials say they selected Richmond because of the area’s regional economic development program, transportation system, higher education research and development and downtown revitalization.

A Woman’s plans

Woman’s Hospital has submitted plans for a new hospital complex to be built on the site of Briarwood Country Club. According to the paperwork submitted with the Planning Commission, the complex will consist of three buildings: a 300-bed medical center, a 260,000-square-foot medical office building and 69,105 square feet of support services facilities. The architects are Dallas-based HKS Inc. and Ford/Dickinson of Baton Rouge. Woman’s Hospital officials said in October that groundbreaking was scheduled for early 2008 and completion expected in 2010. —Steve Clark

Certification obstacles

Advance Baton Rouge, a nonprofit organization championing major change in EBR public education, is running into resistance from the Louisiana Department of Education in ABR’s push for authorization to provide an intensive alternative certification for principals. The certification proposal is contained within ABR’s overall principal training program, called Redesigning Lessons, Re-envisioning Principals. The aim is to get more qualified principals—not necessarily those with traditional academic backgrounds—into EBR public schools. The program already has $300,000 in startup funds pledged from the Wilson Foundation.

DOE’s certification division is refusing to recommend approval of the proposal to the state Board of Elementary and Secondary Education that the proposal be approved, ABR executive director Kristy Hebert says. Neither has DOE informed BESE that such a proposal exists. As of press time, the proposal was not on the board’s Feb. 21 agenda. Not approving the certification program now would effectively delay it by a year, Hebert says. “We want to start systematic change, and I think it’s ridiculous that the state department of education is putting up all these obstacles,” Hebert says. DOE officials did not respond for comment. —S.C.

Disputing towers

Developer R.W. Day and Associates and MAPP Construction are headed to arbitration over the Southgate Towers condo project near LSU. In a demand for arbitration filed in July 2006, MAPP alleges that Day owes money for building the condos. In a counterclaim, Day alleges that MAPP’s failure to complete units and solve problems with moisture penetration and electrical defects has made sales impossible.

According to court documents filed by Day with the 19th Judicial District Court, “organic growth” has occurred in the interior of the building as a result of moisture getting in, and sheet rock, molding, floor and studs in the condos have been damaged.

Day’s attorneys say the moisture problems might have been caused by installing sheet rock before the building was weather tight, improper installation of air-conditioning units and roof drains or other factors. MAPP plans to coat and caulk the affected units, but Day wants all of the stucco, exterior skin, walls, felt and metal studs to be replaced and the units to be repaired.

The cost differential between the two plans was not available. The arbitration, before a group of architects in Dallas, is scheduled to start Sept. 3, says Gray Sexton, an attorney for MAPP. Day declined to discuss specifics of the dispute, but says he’s working with contractors, subcontractors and insurance agencies toward reaching a resolution. —Timothy Boone and Anna Thibodeaux

What goes up?

Banks and companies looking for high-quality office space have expressed interest in the old Advocate site downtown (pictured below, just before demolition), but there is no timetable for developing the property, says the attorney spearheading the development.

Charles Landry says the Manship family is interested in doing a special project on the Lafayette Street site, something that adds to downtown. “No one is interested in doing another office building or an ordinary residence,” Landry says. Right now, plans are to build a mixed-use development, with condominiums, offices and retail, but the exact mix of parts has not been determined.

There had been talk about the Baton Rouge Area Chamber moving its offices into the building, but Landry says those plans are up in the air now that BRAC President Stephen Moret has left to head Louisiana Economic Development, and his interim replacement, Steven Grissom, will join LED next month. It’s still a possibility BRAC will move into the building, but Landry says it will be up to the new leadership.

The Manships are also taking their time with another prime piece of real estate—the vacant Advocate printing facility on Bluebonnet Boulevard. The lot offers rail access and is close to Baton Rouge General Hospital, Mall of Louisiana, Perkins Rowe and the Jimmy Swaggart Ministries complex. The family is patiently considering all of the offers they’ve received for the land. “They’re not going to take the first offer that comes through the door,” Landry says. —T.B.

Moving Realtors

The Greater Baton Rouge Association of Realtors plans to move into a new office on Perkins Road before the end of the year. Herb Gomez, executive vice president, says the board is building a $2 million facility in the Jamestown at Old Perkins mixed-use development near Pecue Lane. The Realtors currently have an office off Bluebonnet Boulevard, but Gomez says parking spots and classroom space are in short supply. “When we moved into this building about 15 years ago, we had 1,200 members,” Gomez says. “Now we have 2,500 members.” The new office will be about 15,000 square feet, triple the size of the current location. Gomez says it hasn’t been decided yet what will happen to the old building. —T.B.

Nothing Happened in January

The new Price LeBlanc Toyota Scion dealership should open this spring. The work is part of a $12.5 million expansion that will also give the Airline Highway business a larger Lexus dealership. Cangelosi Ward is the general contractor for the project, and Castles Design Group is the architect.

The commercial mortgage-backed securities [CMBS] market has been a primary source of permanent funding for commercial properties for almost two decades. Loans have been closed and the conduit lenders have sold the CMBS on Wall Street to a willing group of investors on a regular basis. But something happened in January that has not happened in a long time. In fact, I believe it has not happened since 1990. Nothing happened.

Read Brian Andrews’ column every Tuesday in Real Estate Weekly. To subscribe, visit businessreport.com and click on “E-newsletters” on the navigation bar.