Could the Louisiana Housing Corporation raise its low-income housing program fees without a two-thirds legislative vote?

Plain-English summary

The Louisiana Housing Corporation asked whether it could increase fees connected with low-income housing tax-credit allocation and compliance monitoring without a two-thirds vote of the legislature. In December 2015, the Attorney General concluded that a new or increased LHC fee required enactment of a law approved by two-thirds of the elected members of each house. Rulemaking authority alone did not satisfy that constitutional condition.

The AG discussed the corporation’s inherited fee schedule, a 2014 change to its authorizing statute, and the constitutional amendment’s history. It read the amendment as responding to fee increases made by administrative rule without a legislative vote. The opinion addressed the proposed fee increase, not the merits of the housing program.

Currency note

This opinion was issued in 2015. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Common questions

Could LHC increase a fee through an administrative rule alone?

The AG said no. It required a law with the constitutional two-thirds vote for a new fee or increase in an existing one.

Did the 2014 change to LHC’s fee statute remove that requirement?

No. The opinion said the constitutional provision controlled to the extent a statute conflicted with it.

What legislative vote did the AG identify?

It said approval by two-thirds of the elected members of each house of the Louisiana Legislature was needed for the increase.

Background and statutory framework

La. Const. art. VII, § 2.1(A) required a supermajority law for new or increased state fees and civil fines. The AG reviewed La. R.S. 40:600.110 and the history of the 1995 constitutional amendment before advising LHC to present the proposed fee increase to the legislature.

Source

• Landing page: https://www.ag.state.la.us/Opinions
• Original PDF: https://www.ag.state.la.us/Opinion/Download/15-0141

Original opinion text

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DEPARTMENT OF JUSTICE
P.O. BOX 94005
BATON ROUGE
70804-9005
JAMES D. "BUDDY" CALDWEll
ATTORNEY GENERAL

DEC 1 8 2015
OPINION 15-0141

90-A-1 PUBLIC FUNDS & CONTRACTS
Mr. Mayson Foster, Chairman
La. Const. art. VII, § 2.1
Louisiana Housing Corporation
La Const. art. VII, § 2.1 requires that any increase in the fee
2415 Quail Drive
schedules of the Louisiana Housing Corporation must be
Baton Rouge, LA 70808
approved by a two-thirds vote of the elected members of
each house ofthe Louisiana Legislature.

Dear Mr. Foster,

Your request for an Attorney General's Opinion has been assigned to me for research and reply. The Louisiana Housing Corporation ("LHC") is seeking the approval of a schedule of fees and fines associated with the allocation of low income housing tax credits (L1HTCs) and the on-going compliance monitoring by the LHC's Asset Management Department. The L1HTC Program, governed by Section 42 of the Internal Revenue Code of 1986, is an indirect Federal subsidy used to finance the development of affordable rental housing for low-income households. The LHC serves as the administrator of the L1HTC program for the State of Louisiana. On behalf of the LHC, you have asked our opinion in order to determine whether the LHC can increase fees related to its statutory authority without seeking and obtaining a two-thirds approval of the Louisiana Legislature.

Relevant to your request is La. Const. art. VII, § 2.1(A), which states:

(A) Any new fee or civil fine or increase in an existing fee or civil fine imposed or assessed by the state or any board, department, or agency of the state shall require the enactment of a law by a two-thirds vote of the elected members of each house of the legislature_

The LHC, formerly the Louisiana Housing Finance Agency ("LHFA"), was created in 2011 by the Louisiana Housing Corporation Act, La. R.S. 40:600.86 et seq. La. R.S.
40:600.110, as it existed in 2011, permitted the LHC to charge only those fees as were being charged previously by the LHFA, and stated as follows:

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Mr. Mayson Foster
Opinion 15-0141
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A. The corporation may charge only those fees as are being charged by the entity on the date that the entity is, in accordance with this Chapter, transferred to the corporation or made a subsidiary thereof.
B. The corporation shall, in accordance with the Administrative Procedure Act, RS. 49:950 et seq., promulgate the schedule of fees to be charged by the corporation in connection with the programs administered by it.
Such schedule shall be submitted to and subject to approval of the Joint Legislative Committee on the Budget.

Accordingly, the LHC currently operates under a fee schedule which was established prior to its incorporation, as set forth by La. RS. 40:600.110 (2011). In 2014 La. RS. 40:600.110 was amended to delete paragraph A. The Board of Directors of the LHC is now inquiring as to whether La. Const. art. VII, § 2.1 (A) requires all fee schedules to be statutorily established and increased by the enactment of a law passed with a two-thirds vote of the elected members of each house of the Louisiana Legislature, or whether a law which provides the authority to establish and increase a fee schedule by rule is sufficient to meet this standard.

A review of the legislative history behind La. Const. art. VII, § 2.1 is helpful here. This amendment to the Louisiana Constitution was added in 1995 by La. Acts No. 1324 in response to an increase in the amount of fees charged by the state and its various boards and commissions. Minutes: April 25, 1995 Hearing on H.B. 320 Before the House Committee on Ways and Means, pg. 7, 1995 Regular Session, Act 1324, (La. 1995) (statement of Representative Gunn, Member, House Committee on Ways and Means). Floor debates surrounding the amendment expressed concern over the fact that the majority of the fee increases were imposed through the Administrative Procedure Act and not voted on by the legislature. Id. Act No. 1324 was intended to provide the same legislative review over fees as La. Const. art. VII, § 2 provides for taxes. Id. (statement of Representative Reilly, Member, House Committee on Ways and Means). Thus, the language used in Act 1324 mimics that of La. Const. art. VII, § 2, which requires "[t]he levy of a new tax, an increase in an existing tax, or a repeal of an existing tax exemption shall require the enactment of a law by a two-thirds vote of the elected members of each house of the legislature." It logically follows that any fee increased after the adoption of La. Const. art. VII, § 2.1 must be statutorily established and approved by a two-thirds majority of the elected members of each house of the Louisiana Legislature and not through rule promulgation under the Administrative Procedure Act. To the extent that La. RS. 40:600.10 conflicts with La. Const. art. VII, § 2.1 then the provisions of the constitution will prevail.

The fee schedule currently in place by the LHC was established prior to this constitutional amendment. Considering the clear disapproval of the ability to increase fees by rule promulgation, it is the opinion of this office that La Const. art. VII, § 2.1 requires that any new fee or increase in existing fees requires a two-thirds vote of the elected members of each house of the Louisiana Legislature. In order to increase the

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Mr. Mayson Fosler
Opinion 15-0141
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current fee schedule, the LHC will need to present the proposed increase to the Louisiana Legislature and obtain approval by a two-thirds majority of the elected members or each house.

We hope this sufficiently answers your inquiry; however, if we may be of further assistance, please do not hesitate to contact our office.

With best regards,

JAMES D. "BUDDY" CALDWELL
AlTORNEY GENERAL

By: ~£iM1=---=-ru-:-I----
Andrea Barient
Assistant Attorney General