Winning The Lottery?
City must prove it can manage money properly
Many folks play the lottery across the country. loThe odds of winning remain approximately 1 in 292 million, yet nearly 500,000 purchase at least one ticket every day – often by those who can afford it the least. A study from Duke University found that one-third of the poorest households in the U.S. contribute to half of all lottery ticket sales in the U.S.
So why would those who can least afford to play the lottery, spend their hard-earned money for a chance to win millions of dollars, when they have a better chance of being killed by a meteorite?
The answer to that question, in study after study, may seem obvious – they wish to improve their financial status and finally experience a better life. And it seems, as the studies suggest, the more desperate you are to get out of poverty, the greater you will spend on the lottery, by comparison.
If you do win, however, statistics show 70% of lottery winners spend (lose) all of their fortune within a few years. This is because if you didn’t know how to responsibly handle your money before winning the lottery, you won’t suddenly know how to do so after a few million dollars are deposited into your bank account, especially if you don’t have a specific plan on what – and how much – you will spend your money on.
And what’s worse is that researchers at Vanderbilt University, the University of Kentucky and the University of Pittsburgh all concluded that the more money you win makes it more likely you will end up bankrupt.
This got me thinking about Mayor Perkins and his $240 million bond proposals on the ballot next month. He, too, is hoping to win the “lottery” with the passage of these bonds so that we might improve our city’s financial status and experience a better life.
But the city can’t afford to play the lottery, at least not right now.
After all, it’s not as if the city has been a good steward of our money over these many years, and there’s no indication why this would suddenly change with a $240 million windfall. Perhaps Perkins and some city council members hoped voters weren’t paying much attention or they’d be wooed by sermons on how Shreveport is only one more massive spending spree away from a new golden age.
If that’s the case, they’re mistaken. We still remember the city overpaid $30 million over the past 10 years – a misappropriation of $3.2 million every year – to its health insurance plan for city workers. We know that Shreveport’s internal auditor also recently found, for over a year, the city had paid more than $26,000 in pension benefits to dead retirees and beneficiaries.
We found out in 2019 that the city had been assessed almost $500,000 in penalties from the IRS because of late quarterly
filings in 2019. We know the city continues to overbill its customers for water and sewer services (and is also spending $1 million in court to keep from refunding those same customers).
We remember how this administration changed insurance agents (days before Perkins was sworn in) and how the city was forced to pay the cousin of Perkins’ campaign manager twice as much in premiums for one-half the insurance coverage. And how Perkins double-dipped and collected both his annual car allowance of $5,400 while being furnished a city vehicle.
And going way back, remember when taxpayers passed a bond over 20 years ago to build a new police headquarters, and yet they are being asked to do that all over again today? And what about that Convention Center that we built and are still subsidizing at the cost of $2.1 million each year?
Oh, and in the latest, the city just awarded a $10 million recycling contract to a company that has no experience, no equipment, no trucks and no employees. (Try finding the sense in that.)
But this isn’t Perkins’ first time to play the “lottery.” He did so in 2019 (proposing $186 million in debt) and then again much earlier this year (proposing $207 million in debt). The same reasons for voting against this latest proposition (for $240 million in debt) remain the same as with the previous propositions: It’s the lack of details from Perkins about the specific expenditures proposed, any guarantee of what the money will actually be spent on, and the lack of accountability should any part of it not happen as planned.
Yes, our police and fire deserve every dollar we can give them, but remember, this mayor gave our police officers a raise, and then essentially took it away by increasing their health insurance premiums just a few months later.
And it’s not that the city doesn’t need to borrow the money or the projects proposed aren’t worthy of consideration; it’s that too many don’t trust this mayor to do what he says he will do. That’s because, by and large, he hasn’t.
I mean, we’re talking about doubling our city’s current general obligation bond debt and increasing the debt owed by every man, woman and child by $1,314, on top of already having one of the highest property taxes in the state, plus not even having the “current resources” to fund our city’s obligations (and that according to the city’s independent auditor).
I get it, though. We all want Shreveport to find its way out of financial trouble, but studies have shown that winning the “lottery,” or collecting a large cash payout, just leads to more financial trouble, not less.
Until the city gets better at managing what it has, the “odds” are it won’t be any better at managing what it currently doesn’t have – however desperate we might be to improve our financial situation and provide a better life for our citizens.
Louis R. Avallone is a Shreveport businessman, attorney and author of “Bright Spots, Big Country, What Makes America Great.” He is also a former aide to U.S. Representative Jim McCrery and editor of The Caddo Republican. His columns have appeared regularly in 318 Forum since 2007. Follow him on Facebook, on Twitter @louisravallone or by e-mail at firstname.lastname@example.org, and on American Ground Radio at 101.7FM and 710 AM, weeknights from 6 - 7 p.m., and streaming live on keelnews.com.