Attorney General Jeff Landry, left, wanted the State Bond Commission to restrict Louisiana from borrowing from banks that refuse to do business with certain gun manufacturers and limit their fossil fuel investments. Treasurer John Schroder, who chairs the bond commission, moved ahead with the sale of $275 million in general obligation bonds to the lowest bidder. (Drew Angerer/Getty Images; Schroder campaign)
Members of the State Bond Commission met Friday and opted against placing any restrictions on the banks Louisiana is allowed to borrow money from based on the institution’s environmental, social or governance views.
Concerns that limiting the state’s choice could cost taxpayers in terms of higher interest overcame calls from Attorney General Jeff Landry to steer clear of lenders who refuse to do business with certain gun manufacturers or limit their fossil fuel investments.
Landry and Treasurer John Schroder, who chairs the bond commission, are both announced Republican candidates for Louisiana governor.
Schroder has expressed similar views as Landry against so-called ESG principles in the financial sector. Yet at Friday’s meeting, the treasurer moved through the agenda without any consideration of conditions for banks that want to service Louisiana’s general obligation bonds, which must be awarded solely based on the lowest bid obtained.
State and local governments use general obligation (GO) bonds to finance projects that typically don’t generate revenue, making it all the more important for the borrowing authority – in this case, the bond commission – to obtain the best interest rate for its long-term debt.
Without any action taken Friday, the bond commission will move forward with its usual process of soliciting sealed bids for $275 million in GO bonds. The lowest bidder will be awarded the deal, which should come together before the end of spring.
Landry, who sits on the bond commission but wasn’t at Friday’s meeting, used Twitter to voice his opposition to sticking with the status quo on GO bond sales.
“It is my belief that this special Bond Commission meeting is unnecessary and a waste of time and taxpayer money,” Landry said. “If the objective is to seek the absolute lowest interest rate, we should have done a competitive sale from the outset. This entire solicitation process, including asking the banks to certify to their 2nd Amendment and fossil fuels policies, was completely useless if we were going to do a negotiated general obligation bond sale with a woke Wall Street bank regardless of their ESG policies.”
This special Bond Commission meeting is unnecessary and a waste of time and taxpayer money. If the objective is to seek the absolute lowest interest rate, we should have done a competitive sale from the outset. (1/2)
— AG Jeff Landry (@AGJeffLandry) February 24, 2023
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