Can Alexandria's development authority grant money to help a company lease a facility outside the city?

Plain-English summary

The Greater Alexandria Economic Development Authority proposed a $360,000 grant to the England Economic and Industrial Development District. It would offset half of Ucore North America's lease payments for two years if the company chose a facility at the former England Air Force Base, outside Alexandria. The authority asked whether it could make the grant through a cooperative endeavor agreement.

The attorney general said no under the described circumstances. The Alexandria authority had power to enter cooperative endeavor agreements, but its statutory purpose centered on renovation, restoration, and development of property within the city. The proposed money would solely offset rent on a facility outside the city. The request did not show that placing Ucore there would develop property within Alexandria.

The opinion acknowledged that the two development bodies appeared to share some purposes concerning Alexandria. That overlap did not give the Alexandria authority power to spend this grant on the out-of-city lease without furthering its stated city-property purpose.

What this means for you

Alexandria development officials

The opinion distinguished authority to make a cooperative endeavor agreement from authority to fund the particular activity. It concluded the proposed lease subsidy was outside the Greater Alexandria authority's power on the facts supplied, despite its general ability to cooperate with other bodies.

Businesses seeking site incentives

The proposed grant depended on Ucore choosing an England Air Force Base facility. The attorney general's objection was to using the Alexandria authority's funds for lease payments on property outside the authority's territory without a stated link to renovation, restoration, or development of Alexandria property.

Other public development districts

The opinion described the England district as having authority to contract for its economic-development purposes and noted that its territory covered Rapides Parish. It did not question that district's existence or its own powers. The answer concerned the Alexandria authority's proposed expenditure.

Common questions

Q: Could the Greater Alexandria authority pay half of Ucore's rent at the England facility?
A: The attorney general said no to the proposed $360,000 grant because the facility was outside Alexandria and the request showed no development of city property that the grant would further.

Q: Does a cooperative endeavor agreement by itself authorize a public grant?
A: No. The opinion said the authority could enter such agreements but still had to have power to spend funds for the agreement's particular purpose.

Q: Did the two districts' overlapping economic-development goals change the answer?
A: No. The attorney general acknowledged some common purposes but found no basis in the described project to connect the lease subsidy to development of property inside Alexandria.

Q: Did the opinion rule on every grant involving property outside Alexandria?
A: It addressed this proposed rent subsidy and repeatedly confined its conclusion to the circumstances described. It did not decide a different grant with a demonstrated city-property purpose.

Background and statutory framework

Alexandria formed its development authority under La. R.S. 33:2740.60. Its boundaries were the city limits, and its stated purpose included renovation, restoration, and development of property in the city. The England district covered Rapides Parish, with the former England Air Force Base about five miles northwest of Alexandria.

La. Const. art. VII, § 14(C) permitted political subdivisions to cooperate for a public purpose, and La. R.S. 33:2740.60(D) authorized the Alexandria authority to engage in cooperative endeavors. The attorney general then asked whether the proposed expenditure fit the authority's purpose. Because the grant would solely pay part of Ucore's lease outside the city, without a stated effect on Alexandria property, the opinion found no authority for it.

Citations and references

• La. Const. art. VII, § 14(C) (cooperative endeavors)
• La. R.S. 33:2740.60(D) (Alexandria authority's purpose and cooperation power)
• La. R.S. 33:2740.60(E) (authority boundaries)
• La. R.S. 33:130.355(8) (England district contracting power)

Source

• Landing page: https://www.ag.state.la.us/Opinions
• Original PDF: https://www.ag.state.la.us/Opinion/Download/23-0115

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain; the linked PDF is authoritative.

STATE OF LOUISIANA
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Ovviu: OF THE ArroTNl:’ GENERAl,
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B.u’ox RooE, L.
70804—9005

Liz i\4L’RRiLL
A’rroRNF:y Gix:it-i,
March 6 2024
OPINION 23-01 15

90-A-2 PUBLIC FUNDS — Loan, Pledge or Grants Tiffany N. Sanders
La. Const. art. VII, § 14(C)
General Counsel
Greater Alexandria Economic
La. R.S. 33:2740.60(B), (C), (D), and (E)
La. R.S. 33:130.351
Development Authority
La. R.S. 33:130.352
929 Johnston Street
La. R.S. 33:130.355(8)

Alexandria, Louisiana 71 301
The Greater Alexandria Economic Development Authority does not
have the authority to provide a grant through a cooperative endeavor agreement which covers lease payments on property that is located outside the territorial boundaries of the development authority and
Dear Ms Sanders
does not further the renovation, restoration, and development of
property within the City of Alexandria.

You have requested an opinion of the Attorney General on behalf of the Greater Alexandria Economic Development Authority (“GAEDA”) Concerning a prospective cooperative endeavor agreement between GAEDA and England Economic and Industrial Development District (“EEIDD”). You ask whether it is permissible for GAEDA and EEIDD to enter into a cooperative endeavor agreement in which GAEDA would provide a grant in the amount of three hundred and sixty thousand dollars ($360,000.00) to offset one- half of Ucore North America, LLC’s (“Ucore”) lease payments for two years in return for Ucore selecting an EEIDD-located facility for its Louisiana Strategic Metals Complex.
Your request has been assigned to me for research and reply.

GAEDA was formed in 2003 by the City of Alexandria, Louisiana in Ordinance No. 286- 2003, pursuant to La. R.S. 33:2740.60, to provide for and promote the economic development of the City of Alexandria in order to provide for the renovation, restoration, and development of property in the city and for GAEDA to pay the costs of capital improvements relating thereto, and to engage in cooperative endeavors with the state and its political subdivisions or political corporations, with the United States or its agencies, or with any public or private association, corporation, or individual.1 The boundaries of GAEDA are the territorial limits of the City of Alexandria.2

EEID was created in 1991 for the object and purpose and utilizing the former England Air Force Base to replace and enhance the economic benefits generated by the former air base with diversified activities including, among other things, planned land uses to foster creation of new jobs, economic development, industry, and relocation of people and businesses to the area.3 EEID is authorized to enter into contracts to achieve the district’s

1
La. R.S. 33:2740.60(B), (C), and (D).
2
La. R.S. 33:2740.60(E), City of Alexandria Ordinance No. 286-2003, Section III.
La. R.S. 33:130.352.

Page 2

OPINION 23-0115
Tiffany N. Sanders
Page 2

object and purposes.4 England Air Force Base is located approximately five (5) miles northwest of the City of Alexandria, however, the territorial limits of EEID is the entirety of Rapides Parish.5

As part of an incentive package, GAEDA would like to provide a grant to EEIDD to offset one-half of Ucore’s monthly lease payments for a two-year period if Ucore selects an EEIDD facility for its operations in Louisiana. GAEDA plans to achieve this by entering into a cooperative endeavor agreement with EEIDD, however, you ask whether this is permissible as the England Air Force Base is located outside of the territorial boundaries of GAEDA.

Concerning cooperative endeavor agreements, political subdivisions are authorized by La. Const. art. VII, § 14(C) to enter into such agreements for a public purpose. Although GAEDA has the authority pursuant to local ordinance and La. R.S. 33:2740.60(D) to enter into a cooperative endeavor agreement, we must examine whether GAEDA has the authority to expend funds in such a manner, i.e., funding lease payments on property located outside the territorial boundaries of GAEDA. As discussed earlier, La. R.S. 33:2740.60(D) states that the purpose of GAEDA is for cooperative economic development between the City of Alexandria and GAEDA in order to provide for the renovation, restoration, and development of property in the City of Alexandria, with GAEDA paying the costs of capital improvements relating thereto and engaging in cooperative endeavors that further the stated purpose. The grant money GAEDA is proposing to provide through a cooperative endeavor agreement would solely be used to offset the lease payments of Ucore on property located outside the City of Alexandria. There is nothing stated in your request to suggest that attracting Ucore to an EEIDD location would lead to the City of Alexandria realizing any renovation, restoration, and development of property within the city limits. While we do agree that GAEDA and EEID appear to have some common and overlapping purposes regarding the City of Alexandria, we do not believe GAEDA has the authority under the described circumstances to provide a grant pursuant to a cooperative endeavor agreement in this manner.

Based on the foregoing, it is the opinion of this office that the Greater Alexandria Economic Development Authority does not have the authority to provide a grant through a cooperative endeavor agreement which covers lease payments on property that is located outside the territorial boundaries of the development authority, under the described circumstances, that does not further the renovation, restoration, and development of property within the City of Alexandria.

La. R.S. 33:130.355(8).
La. R.S. 33:130.351.

Page 3

OPINION 23-0115
Tiffany N. Sanders
Page 3

We hope that this opinion has adequately addressed the legal issues you have raised. If our office can be of any further assistance, please do not hesitate to contact us.

Yours very truly,

LIZ MURRILL
ATTORNEY GENERAL

BY: in H. Lester
Attorney General