Port commission approves preliminary sign-off to seek up to $42 million in revenue bonds; commissioners press for itemized plan

The Plaquemines Port Harbor and Terminal District voted 8-0 Jan. 30 to give preliminary approval to seek up to $42,000,000 in revenue bonds and to apply to the State Bond Commission for final consideration.

The bond measure is intended to fund four categories of work, Charles D. Tillotson, executive director, told commissioners: "this is a a revenue bond for 4 items that is for, the renovations that we plan to do, to the Newport Administrative Building, for the water booster station. It's more of a cash flow issue there where we do have a grant from DOTD, but it's probably gonna be 3 years before we're we're reimbursed. So we wanna make sure that we cover that. Purchasing land for the container terminal, and then closing out the, the sustainability partners, concession agreement and getting that off of our book," Tillotson said.

Why it matters: The commission would use bond proceeds to bridge reimbursements and to finance facility and land purchases that staff say are needed to support port operations and future container activity. Commissioners repeatedly cautioned that drawing the full $42 million immediately would be imprudent and pressed staff for phased draw limits and itemized estimates prior to any spending.

Discussion and safeguards Commissioner Jurcic urged caution and requested an itemized breakdown before any funds are drawn, saying, "I don't wanna be caught with, alright. We used 30,000,000. Now we're responsible for but when we don't have a vendor, we don't have no way of recouping that revenue yet." Jurcic asked how much of the $42 million would be spent on each line item and said he did not want the port to incur debt without identified revenue streams.

Tillotson and staff said the bond would be drawn in phases as projects require funds and that multiple approvals would be required before any money is spent. "It is to phase that in. But we will only phase that in for what we need when we need it," Tillotson said, adding that final project approvals and any drawdowns would come back to the commission.

Bond counsel and advisors present told the commission they are negotiating bank terms that would allow the district to prepay borrowed amounts without penalty. Bond counsel said negotiators are seeking protection that would permit prepayment if the district drew more than it ultimately needed but later had funds to repay early. "You can prepay at any time," bond counsel told the commission, describing a protective feature under negotiation.

Lucius McGee of Argent Advisors, identified as the municipal advisor that the commission is considering, said his role would be to advise on negotiation and the prudence of borrowing. "My role will be helping with that negotiation and hopefully, providing some advice on the financial side and the prudence of the borrowing of the funds," McGee said.

Outcome and next steps The commission's vote provided only preliminary approval to pursue bond authorization with the State Bond Commission; Tillotson and staff said final bond documents, draw schedules and project budgets will return to the commission for approval before any money is spent. The item passed on the required preliminary roll call, 8-0.

Provenance: discussion and vote on the revenue bond appear during the agenda item introduced as "6 g" and related public and commissioner remarks; staff and outside advisors spoke and answered questions. The record shows the commission will return with detailed cost and draw-down plans before any appropriation or spending occurs.

Ending Commissioners directed staff to schedule follow-up briefings with the district's financial advisor and bond counsel to review an itemized project list and a phased draw plan before final bond issuance comes before the commission.