Jindal-era economic development deal that didn’t go as planned now costing Louisiana millions
Gov. Bobby Jindal’s administration “misclassified” a $34.6 million default payment that Northrop Grumman Ship Systems made to Louisiana Economic Development in 2011 after the shipyard failed to meet certain hiring obligations, according to a newly released audit of the state’s Executive Department by the Louisiana Legislative Auditor.
Instead of using the money to pay off equipment the state had financed for Northrop Grumman, the audit says the Division of Administration “swept” the money when it was balancing the budget. As a result, the state has already paid some $2 million in interest and administrative costs on the equipment, and is potentially on the hook for some $6.2 million more.
“The state will continue to incur additional interest and administrative costs until the debt (on the equipment) is defeased,” the audit reads. “If not defeased before the Oct. 2022 … the state will incur more than $6.2 million in additional interest and administrative costs.”