New Orleans Public Belt Railroad - Interview with Mayor Mitch Landrieu - Part 1

At the end of August, Mayor Landrieu made good on his offer to allow me an interview with him regarding the fate of the New Orleans Public Belt Railroad.  The interview lasted an hour and I'm going to break it up in to sections on a few, possibly three, posts.

In this first sound byte, I asked the Mayor why he seemed so intent on selling and/or leasing the NOPB when nearly all of the other stakeholders, including the main stakeholder - The Port of New Orleans, were adamantly opposed to changing the status quo of the entity established over a century ago.  He quickly corrected me stating that his intent was not necessarily to sell the NOPB but to get an evaluation of the entity as a City asset:


NOPB - Mayor Landrieu - reasoning behind KPMG evaluation from Jason Berry on Vimeo.

The KPMG evaluation was delivered to the City a couple of weeks ago and in the last Board of Commissioners meeting the Mayor's representative on the Board, Ryan Berni, announced that the evaluation did not recommend a sale.  However, it did recommend either entering a public/private partnership for the lease of the Public Belt to be managed by a private company or maintaining the status quo of the NOPB with the City making improvements to the line in a yet to be determined agreement with the NOPB.

Berni then informed the Board that an RFP will be floated by the City to determine interest in the public/private lease option.

As I've posted previously, the Public Belt was originally designed to be a kind of market regulator for the Port of New Orleans.  It was never designed to be a profit-generating entity.  The Belt is a unique municipal asset among American cities in that it was created as a public entity to control rail costs for merchants looking to do business with the Port of New Orleans.

In that respect, many of the businesses that have invested in New Orleans, such as warehouses located along the NOPB line, built their investments on the premise that the rail lines connecting the Port to the Tier 1 railroads would remain in the public realm.  By privatizing the Public Belt (even as a public/private lease) a private company would immediately look at ways to gain a competitive advantage and subsequently pose a potential threat to the bottom line of not just the ancillary companies serving the Port but the Port itself.

Twisted Tracks

In the nearly 116 years since the NOPB's inception, some very complicated agreements with the Class 1 railroads have sprung up along with murky, undefined trackage rights. The most notable is a Joint Maintenance Agreement for the Huey P. Long Bridge involving The State of Louisiana, the NOPB (City of N.O.) and two private Tier 1 companies: BNSF and Union Pacific.  .

(For reference and the sake of brevity, I will list some of the main issues at the bottom of the thread for those who want to dig through them.)

In the interview, I asked both the Mayor and Ryan Berni if the KPMG evaluation was taking into account these myriad contract agreements and trackage rights issues that have developed over the last century surrounding the Public Belt and if it was even possible to create an accurate evaluation without understanding and unraveling these complications:


NOPB - Complications in trackage rights, etc. from Jason Berry on Vimeo.

I have not yet obtained a copy of the KPMG evaluation but have reached out to representatives from the company for comment.  I am not sure if the evaluation did take in to account any, all or none of the agreements of which I queried Mayor Landrieu and Berni.

In the meeting last week, Port stakeholders voiced their opposition to the public/private lease option and even the release of the RFP, stating it was creating a market disruption for future investment and business in the Port.  Berni dismissed the concern, noting that the NOPB just turned in a record month.

Also in the meeting, a letter was read from an attorney who represents the Tier 1 companies, Carmac M. Blackmon, esq., voicing the national rail carriers opposition to the public/private lease of the NOPB.

The dissent of the Tier 1 companies is disconcerting.  If these companies such as BNSF and Union Pacific decide to play hardball on the trackage rights issues upon the NOPB being leased to a private company, it could lead to a protracted legal battle with the City resulting in the NOPB losing access to portions of the NOPB line.  Worse, it could lead to some or many of the Tier 1 companies deciding to pull out of New Orleans completely, creating a significant disruption in Port business and operations.

I asked the Mayor if he was concerned about the effect the potential sale/lease of the NOPB was having on the Port, I will address that issue in the next post.


Contractual Issues surrounding the New Orleans Public Belt (not a definitive list):

-  The NOPB has twelve agreements with Canadian National Railway that range from trackage rights, customer service and wharfs, intermodal, and interlocker usage and maintenance. Canadian National actually owns a portion of the NOPB mainline that allows the NOPB to use for free.

-  The NOPB has three agreements with CSX Railroad regarding trackage rights, track maintenance, and signal maintenance of the Almonaster Bridge over the Industrial Canal which lies on the CSX mainline.

- BNSF has trackage rights from Avondale, over the Huey P. Long, all the way to Gentilly.

- The Huey P. Long Bridge is under a Joint Maintenance Agreement between BNSF, Union Pacific, the State of Louisiana and the NOPB.  It is unclear how the two Tier 1 rail companies would react to a private company taking over maintenance and full access to the bridge of which they have an ownership interest.

- The City would have to get federal approval from the Surface Transportation Board to lease the NOPB.

- Will the City protect the labor union jobs if the NOPB is leased to a private company?   Currently the NOPB supports about 160 high paying jobs.  How many of these jobs will be eliminated if a private company runs the Belt?

- Local stakeholders have existing agreements and contracts with the NOPB. Will these contracts be honored and if so for how long?

- The lease of the NOPB could greatly affect the New Orleans Gateway, particularly the highly trafficked French Quarter.  As of now, the City has ultimate control over the union workers that operate the NOPB and can control issues surrounding highly trafficked tourism events such as Mardi Gras.  The introduction of a private company could negate much of the control the City exercises over the rail usage and interfere with high volume events.  Especially if the Tier 1 companies choose to exercise their own trackage rights and bypass the NOPB altogether.

- Under current state laws, the NOPB and the City do not share revenue, expenses, or legal liability.  How will these issues be resolved and will it require changes to law on the state level?

-  Currently the NOPB is exempt from property and sales tax.  Would these exemptions be eliminated if a private company runs the Belt and if so how would that affect the cost of business for the Belt and subsequently the Port?

The Wisner Trust - Grants get doled out along with a lot of misinformation

Mayor Landrieu doles out $1.13 million in Wisner fund grants

"The latest: a state 4th Circuit Court of Appeal ruling in September that Landrieu, as mayor, would remain the fund's sole trustee"

The 4th Circuit didn't declare the Mayor the sole trustee, he has always been the sole trustee.  But the real question is, "How can the Mayor be the sole 'trustee' if the trust itself is dissolved?"  If the trust is, in fact, dissolved then City Council now has total oversight over the grant money. It would seem the Mayor effectively sued himself out of the trustee position if the trust is actually dissolved.

In fact, he legally shouldn't even be doling out a dime of that money without City Council's approval.  CC just doesn't seem to have the will to challenge him on it.  I would humbly suggest they find the will soon because they are fiscally responsible for what is happening with the City's portion of the funds and I would humbly suggest there may be big problems with how those funds have been disbursed.

"The money is generated from 50,000 acres of lucrative coastal land that includes major land leases -- including the property under Port Fourchon -- to the oil and gas industry."

The bulk of the land bestowed in the Wisner donation is not coastal, only the Wisner Beach is technically coastal.  Here is a map:



"The City of New Orleans owns all the land that Port Fourchon sits on....." - Mayor Landrieu

No it doesn't...not even close.  The donation constitutes about 60% of Port Fourchon and includes Wisner Beach which is a small portion.  The importance of Wisner Beach is that the LOOP (Louisiana Offshore Oil Port) has piping which runs underneath it on its way in shore.  This particular lease generates a significant portion of the oil and gas royalties that comprise the fund but the primary money generators are the leases from the Port and Chevron.  And the city of New Orleans is not the sole owner of the land, there are currently four other owners:  LSU, Tulane, The Salvation Army and the Wisner heirs.

The sport fisherman's boat launch is on Wisner property but it certainly doesn't constitute "all the land that Port Fourchon sits on...".

It makes me wonder if Mitch is deluded or simply unaware of the reality.  It seems like he thinks he owns everything, including Port Fourchon, and he thinks he's going to do whatever he wants with it.  What he wants, as I suggested back at the beginning of this battle, is to sell the land while he's still in office using the proceeds however he sees fit.  And by the looks of many of the donation recipients he sees fit to pay off his peeps and lucrative voting blocs (I have more coming on that issue soon).

This article is the first time he's publicly admitted that intent (to sell), "Landrieu, who once considered selling the land, said his team is assessing the property's worth -- a study he compared to his administration's evaluation of the Public Belt Railroad."

Dream on.  He can't sell that land without the consent of the other four owners or by winning a protracted and vicious court battle that would run well past his tenure in office.  It's also worth noting that both the heirs and LSU filed writs regarding the 4th Circuit's decision to the Louisiana Supreme Court.

Wisner heirs writ to LA Supreme Court

LSU writ to LA Supreme Court

No surprise...the LASC denied the writs last week.

It's curious to me that neither The Advocate nor the TP bothered to ask the Mayor how much each of the recipients received out of the $1.13 million.  Last week I posted what I believe to be the allocation amounts to each respective organization, but I'm not sure this is 100% accurate.

If it is accurate the big winners are the mayor's pet projects: Ceasefire New Orleans ($348,600), Mayoral Fellows Program ($233,837), and a new organization created by Landrieu, the Network for Economic Opportunity ($250,000).  All totaled these three organizations, none of which arguably fit the definition of grant recipients, add up to $832, 437... about 3/4 of the entire grant allocation.

I've written extensively about the Ceasefire program here on AZ and some questionable accounting as to money that was disbursed to the organization's fiscal agent, the Urban League.  I've been digging deeper into some issues I've discovered with Ceasefire and some other grant recipients but I want to wait to publish that info as I think The Lens has done more extensive research and I hope to see a story from them soon.

The major increase in money going to the Mayoral Fellows Program from last year is curious as well. I published a post in August about how there was some screwy biz going on with how the program was listed in the municipal code.

I have no idea what the Network for Economic Opportunity is all about but I find it hard to believe that it even remotely fits the guidelines that were originally established for grant recipients.

More to come...





    

What wicked webs we weave...

Friday, I received the portion of the transcript from the Wisner hearing which details the argument City Attorney Sharonda Williams made to Judge Zeno that the Mayor should be allowed to spend the City's portion of the Wisner funds without approval from the Wisner Trust Donation Advisory Committee.  Here 'tis:

Winser v CNO Court Transcript - Sept. 24, 2013 - City Attorney Sharonda Williams

As I stated before, the City's entire argument was predicated on the premise that the Mayor is not subject to the approval of the Advisory Committee in order to spend the funds because once the money is transferred into the city coffers it becomes a public issue.  That would mean the money is public and the legislative branch, City Council, then becomes the oversight body.

William's own words from the transcript:

"And when you look at the City Code that talks about establishment of the Advisory Committee, one of the portions of the Code is that; '...Direction and functions of the Advisory Committee are subject to the control and direction of the Council, which contemplates the normal checks and balances of any governmental entity, the Council and the executive branch.' That's the checks and balances"

....and...

"What if, just for hypothetical sake, what if the Mayor did decide to give grants to some entity, the Advisory Committee says, yes, we agree with the Mayor, we're going to give you our consent, but then the Council decides that they do not agree with that?  What would the Advisory Committee do then?  They just don't have a place in that process.  It's the traditional government model in a democracy.  It's checks and balanced, executive and legislative branch."

The Advisory Committee is here to give advice and consent that the Mayor may act on related to matters having to do with the Trust.  This is not a matter related to the Trust.  This is a matter related to civic city government."

Zeno goes on to ask her if City Council has the authority to amend the role of the Advisory Committee and Williams responds:

"They can.  They can amend it.  Of course they can.  That is part of their legislative ability."

So now...flash forward to the November 6th City Council meeting concerning the city budget.  Video here:



For some reason the video embed link only has 7 seconds.  You can find the video at the CC website here, scroll down to the November 6th City Council meeting.  The Wisner issues first start at about 28 minutes into the session with Head addressing Cedric Grant.  It picks back up at 57 minutes into the session...although you may want to skip over Jackie Clarkson cackling about how she doesn't think the Wisner funds should go through the Council because they never have before and this Mayor doesn't need to be scrutinized.  Then finally at 1:12, the conversation between Head and Erica Beck takes place.

Councilperson Head questions the Mayor's peeps about why the Wisner budget line item is "$0".  City Attorney and the Mayor's appointee to the Advisory Committee, Erica Beck, responds and tells Head the Council has no control over the Wisner funds.  She sat in the courtroom and listened to the argument made by her colleague, Williams, to Judge Zeno then she stood up in front of City Council and told them they have no dominion over the Wisner funds or how the Mayor spends the money.

The Mayor's office is either misleading the judge, misleading City Council...or it's misleading both.  I'm not going to go so far as to say Beck lied to Head...but she certainly dissembled in respect to the stance they took in court, particularly at 1:17 in the video when Beck claims that no one (in the Mayor's admin.) would envision a process where Council oversees the Wisner budget.  I guess no one but the city attorney arguing that point to the judge.

In fact, when Head asked Beck about a "check and balance system" (1:16 into the video), Beck retorted that she didn't know where Head was getting that language.  I know where that language comes from....from the goddamn case they, themselves, made to Judge Zeno...it's right there in the transcript in black and white.

As if this isn't schizo enough...Beck and the Mayor's office have now come back to the Advisory Committee seeking their approval to award the 2013 grants.  Yes...you read that correctly....after going to court and arguing that the Mayor didn't have to get the Advisory Committee's approval to spend the Wisner money, they are now coming back to the Advisory Committee and asking for approval.

Email from November 21, 2013 to all members of the Edward Wisner Trust Advisory Committee

Why would they do this?  I think for two reasons: 1. The mayor is desperate to spend this money in 2013 with his re-election campaign and a possible run for governor on the near horizon.  2.  They are freaking out because Head is actually threatening to exercise Counsel's right to oversight of the funds.  They would rather let the oversight occur with the Advisory Committee because they think they have that vote locked down....City Council, not so much.

The whole thing would be quite humorous if it wasn't hurting the legitimate entities who need the money.  The Mayor's own hubris and greed to take over the entire Wisner motherlode has lead to his inability to spend any of the money...all this done supposedly under the guise of "transparency".   Now they are forced to spin deceitful webs in a desperate attempt to undo the damage they've done to themselves and the City itself.  

And I know many people are interested in who the City is proposing to give the 2013 grants to....here is that List:

2013 Proposed Wisner Grants for CNO

One thing I just noticed is that in the City Council meeting when Head is questioning Cary Grant about the $600k (approx.) in Wisner line items for Ceasfire and Nola For Life (28 minutes in the video), they state that they included this money in the general budget because it's appropriated to salaries (I think that was the reason, not 100% sure).  However, they are also listing Ceasefire ($100,180) and Nola for Life (under Greater New Orleans Foundation - $250,000) in the proposed 2013 grants.  


  

Public-ishy-ness

I got to watch a short segment today of the City Council meeting where the City's portion of the Wisner Funds was discussed in respect to what responsibility and oversight the Council has over how the funds are spent.  I'll defer to the Lens and Maldanado who was actually there:

Council members seek more accountability in Wisner, NOLA for Life spending

The budget does not, however, include more than $1.5 million in Wisner-funded grants the city usually gives to local charities. As long as the lawsuit is winding through appeals courts, the city doesn’t plan to allocate any Wisner grant money. That could put some of those charities in a bind. 

But even if the money were included, Landrieu’s General Counsel Erica Beck said, the council would have no control of it. 

“The council has traditionally not appropriated any of that grant money,” Beck told the council. “We’ve received no indication from the judge that we need to change.” 

But as blogger Jason Berry recently pointed out, New Orleans Municipal Code appears to give the council control of the fund. In fact, Berry reported, that “check and balance” was central to the city’s argument that the fund should be declared public. 

“If there is in fact council oversight,” asked Head, “and there is a check and balance for this government fund, when do I have that council oversight that is part and parcel to that check and balance?” 

During her remarks on the Wisner Fund, Head also objected to the process for handing out NOLA for Life grant funds, saying it wasn’t transparent, which led to funds going to charities that lacked proper financial documentation.

That is....almost incomprehensible to me....Beck's statements.

She sat in the same courtroom I did and listened to her fellow City Attorney, Sharonda Williams, argue to Judge Zeno that there was no need for the Wisner Trust Advisory Committee to review and provide oversight of how the Mayor spent the City's portion of the money because there was already a check and balance system in place with City Council, who oversees all expenditures of public money by the Mayor.

If they're now arguing that City Council has no oversight or control of the money we need to have another hearing and inform the judge that Sharonda Williams totally misinformed him in the courtroom.

As it stands right now, there is no oversight of how the Mayor spends the money...PUBLIC money.  He could go take out a Wisner Amex and blow millions of dollars on Cheetos, blow jobs, Miller Hi-Life and Angry Bird apps and there would be no legal recourse to stop him....none.

The judge ruled the Trust was PUBLIC.  As of right now, this money is PUBLIC money.  It's not "publicy" money.  It's not kinda-sorta public.  It's not a little bit public....it's fucking PUBLIC.

There shouldn't even be a question of whether or not City Council has control and oversight of how the executive branch spends the money but even if there was a question the City Code clearly states City Council has dominion.  Beck's argument that Council hasn't traditionally appropriated the grant money is moot....when the Mayor decided to attempt to bust the trust and bypass the "traditional appropriation of the money" he negated whatever M.O. was in place.

In fact, City Council now has a fiduciary duty to provide oversight.  If the Mayor did blow the money on Cheetos and blow jobs,  according to the City Code, Council could be held accountable as well.

Yes, I'm being outrageous but not so much in a city that is vaunted for corruption and misappropriation of public funds.  It's not only possible that the Wisner funds will be used as a personal slush fund for the Mayor's pet projects and to pay off political cronies....it's likely.

So Beck is saying that the judge gave them no indication that they need to change yet they must have misled the judge in their legal argument if this is the position they're taking now.  I think City Council needs to get a clarification from Judge Zeno on this matter and find out if he truly intended to turn over millions of public dollars generated annually to the Mayor without any oversight or action for recourse.

Hell, I may run for Mayor and go bankroll all my peeps' private ventures with Wisner funds if that's the case.

I'm waiting for the archived video to be loaded on City Council's website so I can watch the whole thing.  I'm also trying to obtain the transcript from the hearing...I went by Div. D today but the court reporter is on vacation and I wasn't able to get it.  I'll keep you posted.

The Wisner Trust - Not so fast, Mr. Mayor

The Wisner heirs recently filed a suspensive appeal in Div. D to stop the Mayor from spending the City's portion of the Wisner Trust funds until the 4th Circuit Court of Appeals can hear the case.  To my utter surprise, Judge Zeno granted the suspension.

Suspensive Appeal Order by Judge Zeno

This basically cock blocks the Mayor from spending any of the money he's allocated (without oversight) from the City's Wisner fund.  I would also note that it gives City Council time to take up their responsibility as an oversight body as dictated by the City Code, a role that was acknowledged by the Mayor's counsel in the hearing.

I'm betting this puts the Mayor in a bind as I'm sure there are a lot of folks waiting to get their hands on that dinero.

Speaking of that, I was excited to see a tweet last week from The Lens' Charles Maldonado that he had finally received the Mayor's Wisner budget (not sure which years) per a public records request he had file some four months ago.   I guess transparency is like a fine wine, it needs time to age.

UPDATE:  actually a clarification...the heirs did not file the suspensive appeal to block the money being spent by the City, it was filed in order to suspend the overall effects of Zeno's judgement until the Appellate Court can hear the case.  The heirs have deferred to the Wisner Trust Advisory Committee to decide whether or not the Mayor should be allowed to spend the City's portion of the Wisner money until the case is heard by the 4th Circuit.    

A dispatch from ghouls of Halloween past

In honor of All Hallow's Eve, I'd like to post a rather horrifying document, an email chain, that occurred exactly one year ago today between two frightful creatures.  It's not the kind of document that will startle you or make you piss your pants....it's the kind that will turn your stomach and make you upchuck.

Thanks to a public records request filed by an AZ reader and commenter, I've been going through a chain of former City Attorney Michael Sherman's emails regarding matters on Wisner.  Sherman served as the appointee for Mayor Landrieu to the Advisory Committee.

From the get-go, Sherman's primary target was former Wisner Trust Advisory Committee Treasurer/Secretary, Cathy Norman.  His intimidation tactics have been well documented here on AZ, even in video.  Numerous folks who attended the Advisory Committee meetings attested that Sherman "terrorized" Norman to the point where she simply couldn't take it any more and was forced to resign.

I've even heard tell of an incident where Norman was called into the Mayor's office under the auspices of a one on one meeting with him (Mayor Landrieu) only to be hot-boxed by a room full of lawyers, some of them PSC/JV attorneys.

A petty act of intimidation by petty men.

How petty are these men?  Well, I'm going to let you decide that after you read this email chain where Sherman gleefully announces to the JV inner circle that Norman finally resigned, broken by their tactics.

Read the thread from bottom to top

Even more than Calvin Fayard's obvious schadenfreude over Norman's departure, the part that made me laugh and barf at the same time was Sherman proclaiming that he "speaks the truth".  What a rare moment for him indeed...I imagine it did feel good for him to speak the truth.

I believe there was a concerted effort on the part of the Mayor to oust the people from the Advisory Committee he didn't like and replace them with his own cronies.  I've also suggested that LSU and Tulane colluded with the Mayor's wishes by removing their appointees in order to replace them with folks who would follow the Mayor's wishes, Ron Gardner and Anthony Lorino.

Once these cronies were appointed, they immediately followed Sherman's lead to fire the Wisner Trust's counsel on the BP lawsuit, Waltzer and Wiygul, and replace them with the JV attorneys you see listed in the email thread above.

It's pretty vulgar stuff.

I don't expect anything to come of this exposure but if nothing else I want the public to know the truth.  I want them to know what kind of people are roaming the halls of City Hall and pulling the strings of City government.

For the people that actually care to know, that want to know, I think it's important to air this nastiness out.

Happy Halloween.

It's time to take Mayor Landrieu on his word regarding the oversight of Wisner Trust Funds

In my post on the Wisner hearing I noted that Sharonda Williams, New Orleans City Attorney, made an argument to Judge Zeno that there was no need for the Wisner Trust Advisory Committee to serve as an oversight body to how the Mayor spends the Wisner funds because there is already a check and balance system in place.  She suggested that oversight body is New Orleans City Council.  

I found it to be a specious claim the moment I heard it but apparently Judge Zeno took her word and granted the Mayor full control of the City's portion of the Wisner funds.

In fact, he apparently took the city attorneys' word on everything,  even going so far as cutting and pasting part of their counter-motion into his own "judgement".  That cut and paste job was just about the only explanation he provided in any of his rulings which gave Mayor Landrieu practically everything he asked for.

I was pretty sure the City Council claim was a smoke screen when I heard it but I wanted to check and see if City Council members were aware that the Mayor's office considered them to have any oversight with the City's portion of the Wisner funds.

I spoke with two City Council members about the issue, Stacy Head and Susan Guidry.

Councilperson-at-Large, Stacy Head, told me she had looked into the matter back in February and had asked the Assistant Fiscal Officer to the Council, David Gavlinksi, to do the same.

Councilperson Head forwarded me an email chain between her, Gavlinski and City Council President, Jackie Clarkson.  I condensed the messages into this document according to date:

City Council Email Thread on regarding the Wisner Trust 2013

This is what the municipal code states in respect to the Council's involvement with the Wisner funds:

DIVISION 4. – EDWARD WISNER DONATION ADVISORY COMMITTEE
Sec. 2-159. - Function.
Subject to the control and direction of the council, the powers, duties and functions of
the Edward Wisner Donation Advisory Committee shall be the supervision, direction
and administration of all of the lands, funds and avails constituting and comprising the
Wisner donation, or the avails or fruits thereof, and to consult with and advise the mayor in his capacity as trustee upon all matters pertaining to such trust and the mayor when acting upon the advice of the committee, or a majority thereof, shall be deemed to be acting for and in behalf of all the parties at interest. To that end all matters relating to the trust shall in the first instance be referred to and handled by the committee.  (Code 1956, § 19-4) 

Gavlinski goes on to offer an opinion (not legally binding mind you, just an opinion) of City Council's role with the Trust:

Of interest is a section on page six of the attached, which reads:

“… the Mayor of the City of New Orleans, with the approval of the Commission
Council (or its successor body), may act as such Trustee upon the advice and
with the consent of the majority of said Commissioners, and such action, so
authorized, shall be binding on all parties hereto.”

My reading of that is that the Mayor, on behalf of the City, has but one vote
on the committee. That vote is subject to approval of the Council, and must
accompany a majority of the committee member. I’m fairly certain that this is a
level of restraint that has not occurred over the years as any Mayor has seldom
come to any Council for their “approval.”

I think what he's saying is the law states City Council does have legal oversight but it was never actually put into practice.

Soooo...note to City Council:  The Mayor is ultimately subject to the oversight and approval of City Council on all matters regarding Wisner.

In fact, his lawyers just made that exact argument in Zeno's court.  They claimed that they shouldn't have to answer to The Wisner Trust Advisory Committee because they are already legally bound to answer to City Council....Zeno agreed.

The problem is City Council had no idea that they were responsible.  At least the two At-Large members on the Council didn't know, as evidenced in this email chain.  Nor did the third councilperson I spoke with, Susan Guidry.

I'm not criticizing the council members in any way for not knowing this, they are elected officials that came into their jobs following the practices of the council members before them.  The modus operandi and annual budget agenda never included a breakdown of The Wisner grant money.

I believe Gavlinski states as much in his response to the council members after researching the matter:

"It appears as if we have nearly a century of operational inertia whereby the
Council has not appropriated all the funds, even though this practice may
be contrary  powers in the above referenced code. Alas, the Mayor may be
right in one respect, but it seems clear that the fund has operated outside of
complete Council authority in the past.

I believe that historically, there has been more harmony between the chair
of the Committee and the rest of its membership, so this issue may have not
arisen as acutely. " 

Apparently, the issue never came up until now.  Regardless, once again, here's a note to City Council: YOU ARE THE OVERSIGHT BODY.  In fact City Council is now the ONLY oversight body.  The Mayor's counsel just lobbied this admission in a court of law....and the judge agreed.  

I suppose the person we should consult is the Special Counsel to the City Council.  I'm sure that appointee could provide an objective legal opinion on the matter, eh?  Because whoever holds that position would not be privy to the mayor in any way, eh?

As luck would have it, the City just accepted RFQs for that position and four law firms applied.  I'll give you three guesses as to who one of those firms is and the first two don't count.

Funny stuff, huh?  The one critical position with City Council that is supposed to be objective and independent of the executive branch of city government (the Mayor's office) and Herman and Herman are applying for it.  I'm sure there's no conflict of interest there...nah....

...seeing as how they are representing the City and the Wisner Trust in their settlement case against BP...

....seeing as how Herman and Herman members and family members comprised the single largest bloc of campaign contributions to Mayor Landrieu in 2012...

....no....no conflict here.....Where's that Uddo or Zeno opinion when you need it?


   

It's despicable...

...say it out loud in your best Daffy Duck voice....seriously...do it....it's fun...

When I first started covering the Wisner chronicles, I pointed out a moment in NOLA history when then city councilperson, Marlin Gusman, told a Wisner heir that the city was going to "take over the whole thing" in 2014 when the trust dissolves.

I went on to speculate about what might happen if the trust were to dissolve and how it would be not only detrimental to the Wisner heirs and the other trustees but how it could be a mistake for the City in the long run.  I postulated that Mayor Landrieu had designs on carving up the land and selling off the City's share simply to get a quick, lump sum of cash into city coffers while he was in office.

Well...I was wrong.  Even though Gusman and Landrieu are trading barbs at the moment, it seems I should have listened to Gusman's original sentiment in regards to what Landrieu's true intent for the trust was.  I sadly underestimated Mayor Landrieu's chutzpah.  He is now trying to take over the whole thing...I mean the whole damn thing.

Last Thursday, the City filed a motion in response to the Wisner heir's motion for partial summary judgement on wether or not the Trust was perpetual and if the Mayor, in his role as Trustee, has to obtain the advice of the Committee before he spends the City's portion of the money.  Mayor Landrieu and the City of New Orleans' counter-motion not only claims the Trust is dissolved, it claims the City and the Mayor are the sole heirs to the Wisner Trust properties and any monies generated by the assets.

That would exclude not only the family heirs from their 40% ownership, it also eliminates Tulane, LSU (Charity Hospital), and the Salvation Army's interest in the Trust.

He wants it all....and he's going all in.

Aside from the issues we've already broached here on AZ:  the Mayor's claim that the Trust is a public body, his claim that he is not required to let the Committee review projects on which he wants to spend the City's portion of the money, et al., Mayor Landrieu is now asserting that the heirs aren't really heirs.  He is now making the argument that the only "heirs" to the land were the immediate family members to Edward Wisner after he died...as the motion describes it...the "original Wisner Ladies".  This refers to Rowena and Elizabeth, his daughters and Mary Jane Wisner, Edward's widow.

But then it goes one step further, the countermotion also claims the Compromise Agreement should be nullified citing fidei commissa, a legal term that allows a grantor to transfer property to a grantee through a third party.

The first Louisiana trust laws represented a very narrow exception to the longstanding rule that substitutions and fidei commissa were void and against public policy.  In light of this strong policy, these laws have been rigidily construed.  Purported trusts that failed to satisfy the demanding requirements of the trust statutes have been struck down as prohibited substituions.  Moreover, because these illegal conveyances violate public policy, they are absolute nullities that may be challenged at any time.  An action to challenge an absolute nullity does not prescribe and may not be ratified by the parties.  

If I understand this correctly, they are claiming that the 40% ownership transferred to the heirs under the Compromise Agreement was fidei commissa and should therefore be nullified.  I would point out that this claim in item #2 seems to contradict itself by stating that there are narrow exceptions where fidei commissa transfers are allowed but then later goes on to call them illegal.  I'm not a lawyer...I don't know, nor do I know if their claim that fidei commissa is applicable to this case is even accurate.

What I do know...what I've been researching for the past couple of weeks....is the actual history of what happened when Edward Wisner died and how the estate was divided.  I use the word "divided" circumspectly as the actual tale is shaping out to be one of the most sordid stories of back-stabbing and land-swindling in the history of the state.  In fact, I believe it may have shaped this state more than any other "back-room" deal in its history and that's saying a lot for Louisiana.

I'm still working on getting all the pieces of the puzzle together and I hope to post, at least, a brief history of what actually happened with Edward Wisner's estate after his death.  I wish I would have published the historical aspects of the story earlier...you'd be reading this current countermotion with an entirely new sense of irony.

This is definitely one from the crypt, a century ago, but it is by the far the best corpse I've ever dug up.

Back to the present, this move by Mayor Landrieu doesn't just axe the heirs from the picture, it 86's the other Wisner Trust beneficiaries as well.  That's a pretty big chunk of money for both LSU and Tulane to lose every year.  I'm curious if they are going to file suit against the mayor in order to protect their own financial interests.  That would seem like the logical thing to do, no?  I mean, why would they just sit back and allow the Mayor to take over an annual source of income from them?  8 million last year which would put LSU and Tulane's respective pulls at close to a million each.  They don't care about that?

Seems to me that money could help LSU cover the bulk of their 1.3 million scholarship program they're doling out to politically connected muckity-mucks:

LSU Board of Supervisors awards $1.3 million through little-known scholarship program

(See our old buddy Steve Perry in that story?  Don't worry...haven't let go of that one...it's coming.)

And what of Charity Hospital...the building itself?  It seems to be in play at the moment regarding the Mayor's plan to move City Hall and Civil District Court into the building.  Currently, LSU's position in the Trust is contingent upon Charity Hospital, or so it would seem.

I call LSU and Tulane's response to this motion into question for a very good reason.  If you haven't been following the Wisner chronicles here on AZ, time to go back and read Part 2.  It's rather complicated but worth your time if you want to understand the shuffling that's going on behind the scenes.

I hate to say this but you know what thought has been running through my head for the past month?   Poor Ray...he was just an amateur.



And here is WWL's story....I was waiting to post mine after they posted theirs.  I don't care about being first, I just care about being me.  After all...they've got an official legal analyst.  Of course, I do too but I have to wait for them to pipe in on the comment section...(cough, cough)

City drops legal bombshell in dispute over oil-rich property