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Story Archives: OEDC Land Corp. finances murky


OEDC Land Corp. finances murky
by Michael DeVault - posted Wednesday, May 7th, 2008 @ 9:02 pmE-mail Story E-mail Story | Print Story Print Story 
During a 15-month period that OEDC Land Corp. owned the former State Farm Insurance corporate offices in Monroe, the land corporation collected more than $800,000 on the property.

That figure is in addition to the $3.25 million the state of Louisiana paid OEDC Land Corp. to buy the old State Farm office building in 2007.

According financial audits of Ouachita Economic Development Corp. and OEDC Land Corp., the majority of some $827,000 in payments to the land corporation was received as rent for the old State Farm building to be used as an evacuation shelter following Hurricane Katrina in 2005.

From early September 2005 until Dec. 31 of that year, the American Red Cross paid OEDC Land Corp. $308,000 to lease the building for an evacuation shelter.

Also, in 2005, the Red Cross paid an additional $225,000 to OEDC Land Corp. to pay for damages to the old State Farm building while it was used as a shelter.

In 2006, the state Department of Social Services paid OEDC Land Corp. some $294,000. It is assumed the payment stemmed from the state leasing the old State Farm office building as an evacuation shelter once the Red Cross ended its arrangement with OEDC Land Corp at the end of 2005.

It is unclear what OEDC Land Corp. did with the money it received from the Red Cross and the state Department of Social Services since OEDC Land Corp. officials refuse to discuss the land corporation's finances.

OEDC Land Corp.'s refusal to discuss its finances is a source of contention between The Ouachita Citizen and OEDC Land Corp. officials.

David Woolridge, general counsel for the Louisiana Press Association, says OEDC and OEDC Land Corp. are bound by state law to disclose all of their financial records, including any and all transactions involving OEDC and OEDC Land Corp. funds, since the corporations received public funding. He also said OEDC and OEDC Land Corp. are bound by state law to open to the public the meetings of OEDC and the land corporation's board of directors.

The Ouachita Citizen and its sister newspapers, the Concordia Sentinel in Ferriday/Vidalia and The Franklin Sun in Winnsboro, are members of the LPA.

Woolridge cited Louisiana Revised Statute 33:9024 E(2) in saying OEDC and OEDC Land Corp. must make available their records for public consumption.

OEDC Land Corp. president Ben Peters maintains that the land corporation's finances are not a matter of the public record since OEDC Land Corp. is a private, non-profit corporation.

Yet, Louisiana Revised Statute 33:9024 E(2) says, "Without altering the private nature of economic development corporations, any economic development corporation which obtains funds from the state or any agency or subdivision thereof of ten thousand dollars ($10,000) or more in a calendar year shall, as a condition to the receipt or expenditure of such public funds, maintain all of its books and records with respect to the use or receipt of any public funds as public documents and make them available for inspection and copying pursuant to the provisions of the public records law, R.S. 44:1 et seq., hold any and all meetings of such corporation with respect to the receipt or expenditure of public funds in public after due notice thereof in accordance with the provisions of the open meeting law, R.S. 42:4.1 et seq., and comply with any conditions of funding."

According to Peters, OEDC and OEDC Land Corp. are separate entities.

Though Peters says OEDC and OEDC Land Corp. are separate entities, the annual audits of the two corporations for the periods ending 2005 and 2006 were consolidated, meaning the finances for both corporations were included in one audit for each year. Those audits were prepared by the Monroe accounting firm Martin, Harrison and Smallwood.

Peters said the agreement to utilize the old State Farm building as a hurricane evacuation shelter was negotiated at the time by representatives of OEDC Land Corp. and the Red Cross.

Additionally, OEDC Land Corp. and the Red Cross separately negotiated a settlement for damages at the old State Farm building after the shelter was closed, Peters said.

Peters called the arrangement "typical." He said the $225,000 figure was agreed upon after OEDC Land Corp. obtained three bids from general contractors to repair damages incurred at the building while it was used as an evacuation shelter.

The former offices of State Farm were donated to OEDC in 2004 after State Farm announced it would be moving its corporate offices in Monroe to Columbus, Mo.

OEDC's board of directors transferred ownership of the building and its contents to OEDC Land Corp. on Aug. 31, 2005. The land corporation was formed in 2005 by individuals associated with OEDC.

The old State Farm building was sold to the state of Louisiana in January 2007 for $3.25 million. At the time, Gov. Kathleen Blanco said she would like to the old State Farm building razed to make way for a new, state-of-the-art campus for Delta Community College.

Those plans were put on hold when Mike Olivier, who was secretary of Louisiana Economic Development Corp., intervened.

At that time, Olivier said he had been working with a number of promising commercial prospects for the building.

On Olivier's advice, Blanco shelved plans to build the Delta campus on the State Farm property. Six months later, in July of 2007, Accent Marketing signed an agreement to lease part of the building to house a call center there.

In the meantime, OEDC Land Corp. deposited the $3.25 million in a number of banks in Ouachita Parish, though land corporation officials refuse to disclose the names of those banks.

That issue, too, is a source of contention between The Ouachita Citizen and the land corporation.

According to Peters, the purpose of OEDC Land Corp. is to "support the mission" of OEDC by utilizing interest income earned from investing the proceeds from the sale of the old State Farm building.

Also, both Peters and OEDC interim president Pat Regan said OEDC is actively searching for potential projects to utilize the $3.25 million the land corporation received from the state.

Until that day, the money will continue to draw interest in area banks, according to Peters and Regan.


(Sam Hanna Jr., publisher of The Ouachita Citizen, contributed to this report.)
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