Could Ascension Parish transfer a rural-development grant or purchased land to its airport authority?

Plain-English summary

Ascension Parish received a rural-development grant to buy four acres for new hangars at the Louisiana Regional Airport. The grant named the Airport Authority as the intended beneficiary, but the parish was the grantee. The parish asked whether it could transfer the grant money to the Authority to buy the land or buy the property itself and convey title to the Authority.

The 1998 attorney general opinion said either method would fulfill the parish's obligation under the grant and serve a public purpose. It emphasized that the grant restricted the money to the airport land project and that the Authority would have to act consistently with the parish's obligations under it. The office expressly could not determine whether the project created a public benefit proportionate to the amount spent. It said the transfer would avoid being a prohibited donation only if that remaining criterion was met.

Currency note

This opinion was issued in 1998. 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.

Parish officials at the time

The office viewed the grant's express airport-land purpose as supplying the parish's obligation to apply the funds to that purchase. It accepted either a transfer of grant funds for the Authority's purchase or a parish purchase followed by transfer of title, subject to a proportionate public-benefit finding it did not make.

Airport authorities at the time

The opinion said the Authority would have to carry out the project consistently with the grant authorization and the parish's public-fund obligations. The Authority's receipt of funds or title was tied to the specified hangar-development property.

Grant administrators at the time

The opinion relied on the grant's restriction to the four-acre airport purchase. It did not treat any unrestricted payment to the Authority as approved.

Common questions

Q: Could Ascension Parish send the grant money to the Airport Authority for the land purchase?
A: The opinion said that route would fulfill the grant obligation and serve a public purpose, assuming the required proportionate public benefit was present.

Q: Could the parish buy the land first and then transfer title?
A: Yes, the opinion treated that route the same way, subject to the public-benefit condition it left undecided.

Q: Did the attorney general decide that the benefit was proportionate to the $65,000 expenditure?
A: No. The office expressly said it was not in a position to decide proportionality.

Q: Why did the grant's wording matter?
A: It specified a purchase of four acres for the Airport Authority and restricted the money to that project, which the office treated as creating the parish's obligation to apply the funds there.

Background and statutory framework

The office described three criteria for a permissible public-fund transfer: a legal obligation or duty to transfer, a public purpose, and a public benefit proportionate to the expenditure. It found the grant's purpose satisfied the obligation element and the airport project served a public purpose. It cited R.S. 33:9020 et seq. and R.S. 33:9021(7) in discussing local economic development. It left the proportionality element for others to determine.

Citations and references

• R.S. 33:9020 et seq. (cooperative economic development)
• R.S. 33:9021(7) (economic development statement quoted in the opinion)

Source

• Landing page: https://www.ag.state.la.us/Opinions
• Original PDF: https://www.ag.state.la.us/Opinion/Download/98-0330

Original opinion text

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

DEPARTMENT OF JUSTICE
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P.O. Box 94005
TEL.: (504) 342-7013
BATON ROUGE
FAX: (504) 342-2090
RICHARD P. IEYOUB
70804-9005
ATTORNEY GENERAL

SEPTEMBER 16199|
OPINION 98-330

90-A-2 Public Funds - Loan, Pledge of Grants R.S. 33:9020

Joseph C. Wiley, Esq.
A transfer of land title or funds
from a grant to Airport Authority by
Assistant District Attorney
the Parish fulfills the obligation
23rd Judicial District
of the Parish under the grant, and
P.O. Drawer 279
serves a public purpose.
Napoleonville, LA 70390
Ricky L. Babin, Esq.
Assistant District Attorney
23rd Judicial District
P.O. Drawer 279
Napoleonville, LA 70390
Dear Mr. Wiley and Mr. Babin:
This office is in receipt of your request as legal advisor to the Ascension - St. James Airport & Transportation Authority and Parish of Ascension, respectively, for an opinion of the Attorney General concerning a grant from the Governor’s Office of Rural Development to the Parish of Ascension. You indicate the Ascension - St. James Airport & Transportation Authority owns and operates the Louisiana Regional Airport located in Ascension Parish. Ascension Parish applied for rural development grant funds to acquire four acres of property adjacent to the Airport. All concerned in the grant application and approval process understood the purpose of the grant was to acquire four acres of privately-owned property to construct additional airplane hangars to benefit the Airport Authority directly. It was stated in the grant application that the Parish would benefit through economic development and other benefits flowing from the expansion and growth of the Airport. The grant application was approved on February 16, 1998, and the grant awards the Parish $65,000.00 "for the purpose of purchasing four acres of land for the Airport Authority". It is desired by all parties that the Authority, and not the Parish, own the property in question.
The Parish wants to accept the grant funds and then transfer the funds to the Authority for its purchase of the property. However, there is some concern about such a transaction being viewed as a constitutionally prohibited donation of public funds from the Parish to the Authority. Accordingly, you ask the following:
Is an intergovernmental agreement transferring the funds to the Authority acceptable under state law, considering

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Joseph C. Wiley, Esq.
OPINION 98-330
Page 2

the fact that it was the purpose all along for the prop- erty to be acquired by the Authority using the grant funds? If the contemplated transfer of grant funds is objectionable, is there another method available for using the grant funds to acquire the property in the name of the Authority?
This office has repeatedly recognized that the threshold require- ment for a valid donation of public funds is the presence of a legal obligation or duty by the transferor to alienate said funds or property. This is satisfied by the presence of a valid statute, ordinance, charter or contract. Thereafter, it must be found that the expenditure is for a public purpose, and that it creates a public benefit proportionate to the amount expended. The purpose stated for the grant was to purchase four acres of land for construction of airplane hangars since the existing airport property cannot accommodate the new hangars. It was pointed out that at least 20 potential leasers would support the building con- structi0n costs and provide revenue to the Airport Authority. Significantly, it further stated:
This project will assist greatly in the growth and sta- bility of the airport and also improve a valued asset to the Parish of Ascension. In addition, the proposed hang- ars will result in an added economic development benefit to potential growth. A self-supporting airport adds to the parish’s competitive edge in recruiting and maintain- ing businesses.
By the explicit wording of the grant, it is "for the purpose of purchasing four acres of land for the Airport Authority up to the maximum amount of $65,000." The agreement restricts the monies to be used only for this project. We find this fulfills the threshold criteria insofar as it requires the parish to apply the funds for the purchase of the acreage for construction of hangars for the Airport Authority. Moreover, this office has recognized in Atty. Gen. Op. No. 93-22 that a Parish has the power to engage in economic development and to enter into a cooperative endeavor agreement for such purpose. As stated in that opinion, "Care should be taken to insure the Foundations’s commitment to act in a manner consistent with the duties and obligations of the Parish regarding public funds, as well as the Foundation’s commitment to utilize the funds in accordance with the voter authorization as expressed in the proposed proposition."

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Joseph C. Wiley, Esq.
OPINION 98-330
Page 3

Herein the Airport Authority must act in a manner consistent with the obligations of the Parish and authorization under the grant. A Parish’s duty toward economic development is the basis of R.S. 33:9020 et seq. titled, "Cooperativ@ Economic Development", and is specifically stated in R.S. 33:9021(7) by providing that "economic development is a legitimate concern of government because it serves the public interest, but it is not purely and solely a public purpose, since successful economic development serves the private interests of business and industry as much as public interest." Accordingly, we find the transfer of the funds for the purchase of the land by the Authority or the purchase by the parish and trans- fer of the land title to the Authority would fulfill the obligation of the parish under the grant, and serves a public purpose. How- ever, we are not in a position to determine whether it creates a public benefit proportionate to the amount expended. Assuming the latter criteria is met, the transfer would not be a prohibited donation.
Sincerely yours,
RICHARD P. IEYOUB
Attorney General

BARBARA B. RUTLEDGE
Assistant Attorney General

BBR