Alligator Bayou lease in doubt after AG ruling

A Louisiana Attorney General's opinion that came to light Monday threw into doubt the Ponchartrain Levee District's lease of some 160 acres of public land in the Alligator Bayou area to Frank Bonifay for $200 a year for 99 years. The tract includes nearly 40 acres in Iberville Parish.

State law forbids levee districts from entering commercial leases for more than three years, Assistant Attorney General Ryan M. Seidemann noted in the opinion for Attorney General James D. “Buddy” Caldwell.

“It is the opinion of this office that the term of the lease – 99 years – is not permissible under the law under any circumstances,” he said in the opinion issued in response to a request from state Rep. Eddie J. Lambert of Gonzales.

The office said that whether the $200-a-year lease amount was a fair amount was a question a court should decide before the levee board and Bonifay enter into a new lease.

Dwight D. Poirrier of Gonzales, the levee district's attorney, said as a result of the opinion, the levee district would take the issue up immediately to ensure compliance both with the opinion and relevant state statutes.

“I have just received the attorney general opinion,” Poirrier told the POST/SOUTH in an e-mail. “I have not had time to fully digest the contents. However, it appears the lease may not be in conformance with the applicable state statues.”

The lease names the leasor as Bluff Swamp Wildlife Refuge & Botanical Gardens Inc., a non-profit corporation represented by Bonifay, who could not be reached before the POST/SOUTH deadline Tuesday.

Bonifay, who operates Alligator Bayou Tours, currently is suing Iberville and Ascension parishes over the opening of the Alligator Bayou floodgate except during high water, claiming the action is damaging his business.

“The Ponchartrain Levee District entered into this agreement with the non-profit entity to help it protect the sensitive nature of the property it owned in Bluff Swamp,” the levee board's attorney   said. “It is apparent the vehicle chosen to accomplish this was questioned. It is important to note, though, that it was an annual agreement terminable at any time by the Levee District.”

The levee board leased the land to Bonifay from November 1, 2006, to October 31, 3005. According to the lease, Bonifay is required to carry at least $1 million in liability insurance on the property and “to act to protect the fragile ecosystem, to educate the public on the importance of the swamp and the Louisiana culture, and to establish educational and research programs on the leased premises.”

“Although there is little doubt that these stated goals are noble, it is our opinion that none of these stated goals appear to meet any of the exceptions [allowed under state law],” Seidemann wrote in the opinion.

He said state law allows leases of up to 10 years for specific purposes for hunting, trapping and fishing, and for up to 55 years for airports, bulk fuel facilities and airport hangers, except when the lands include areas used for boat mooring facilities.

“Thus, in answer to your question of whether the lease is valid, it is the opinion of this office that a 99-year lease of levee district property is impermissible,” he wrote.

Seidemann said the issue of the $200 annual lease rate would come into question only if the term of the lease could be amended or a new lease developed that would meet the term requirements.

He noted the state Constitutional prohibition against donations of public property to private interests.

“Because such a valuation is a factual question, we are unable to opine as to whether this amount would constitute a fair price for the lease,” he said. “Should the District and Bluff Swamp amend the subject lease or enter into a new lease for the property, we recommend that the parties to the lease seek a declaratory judgment from a court of competent jurisdiction to ensure that this lease meets the requirements of [the state Constitution].”

Under the standards the Attorney General's office adopted to ensure Cabela's compliance with the constitutional provision, the questions for determining if the lease is a permissible expenditure or transfer of public funds for a governmental purpose are if the levee district has the legal authority to pursue the lease, if the lease as a whole appears to be “gratuitous,” and if the public body has a “demonstrable, objective and reasonable expectation of receiving at lease equivalent value in exchange for the lease.”

“The primary focus of this inquiry is to ensure that reciprocal obligations between the public and nonpublic entity exist so as to avoid gratuitous donations of public funds,” the assistant attorney general wrote.