State Treasurer John Kennedy questioned Tuesday whether the Jindal administration embraced the state’s sunshine laws in a meeting to refinance a major legal settlement.
The Tobacco Settlement Finance Corp., which counts Kennedy and Commissioner of Administration Kristy Nichols among its members, met Tuesday and gave final approval to refinancing part of the state’s tobacco settlement.
The refinancing is a state budget solution agreed upon by Gov. Bobby Jindal and many legislators. But not everyone agrees with the structure embraced by the governor.
Afterward, Nichols, who chairs the corporation, issued a prepared statement lauding the refinancing, which she said will generate nearly $143 million for the state over three years. The statement was most reporters’ first inkling that a meeting had been held.
“Did the public and press know this was going to happen today? If they didn’t, that’s an embarrassment,” Kennedy said, who opposed the refinancing option that the corporation exercised.
The corporation usually has met at the State Capitol to discuss how to refinance a portion of the settlement the state received from major tobacco companies for health care costs related to smoking. Meetings at the State Capitol are posted on the Legislature’s website.
Additional notice is given on a bulletin board in the hallway containing the Capitol press corps’ offices.
On Tuesday, the corporation met in a room several floors below Nichols’ office, which is across the street from the State Capitol.
Notice was posted on the Division of Administration’s website instead of the Legislature’s home page. Watching the meeting via the Internet required registration.
“We requested a committee room at the Capitol for this meeting, and the only reason it was held here was because we were told that there was no committee room available,” Michael DiResto, Division of Administration spokesman said by email.
Nine committee meetings were held at the State Capitol, consuming all but two small committee rooms.
The dollars generated by the refinancing will go toward the Taylor Opportunity Program for Students. TOPS helps pay college tuition costs for thousands of qualifying students.
The additional money will free up dollars the state otherwise would have withdrawn from the general fund to put toward TOPS, making those dollars now available for other expenses in a tight state budget year.
The state can refinance because it sold part of the settlement in 2001 for an infusion of cash rather than getting payments over many years. The sale involved taking out bonds that carry interest.
Kennedy is critical of the refinancing option chosen, saying it will take the savings up front rather than lowering the state’s payments or paying off the bonds early.
“An overwhelming majority of the investment bankers who bid on refinancing the state’s tobacco bonds recommended lowering our payments or paying our debt off earlier,” he wrote in a column after the corporation’s action.
Nichols contends it is smarter to take the savings up front.
“I’m happy that today’s action will take advantage of historically low interest rates to help fund TOPS scholarships for Louisiana young people,” she said in a prepared statement.