LCG buys land from detention pond contractor in ‘highly unusual’ deal

Rigid signs at Coulee ile des Cannes
Rigid Constructors was working around the clock at the Coulee Ile des Cannes site in June 2022, after a court order shut down the Homewood project along the Vermilion River. Photo by Robin May

Last month, Lafayette Consolidated Government bought land where a contractor built a detention pond on its behalf, completing an unusual arrangement that held up millions in state capital outlay dollars for a signature flood control project.

LCG paid $250,000 to buy the parcel near Coulee Ile des Cannes from Rigid Constructors. Rigid itself paid $433,000 for the same 44-acre tract on Ridge Road last year in a hasty maneuver to keep digging detention ponds after another major LCG flood-control project along the Vermilion River was shut down over an unlawful expropriation. 

The Homewood Regional Detention Ponds along the Vermilion River and the Coulee Ile des Cannes Detention Ponds near Scott are both part of LCG’s $81 million Bayou Vermilion Flood Control project slated to get roughly $65 million in state capital outlay funding. The state, however, cut off funding from Homewood when the court shut it down, and again withheld reimbursements when it learned LCG did not own all of the property it was digging along the coulee as required by a cooperative endeavor agreement.

Scrutiny on LCG’s requests for state funding has heightened since the Louisiana legislative auditor announced in January that his office was investigating the Guillory administration. Drainage projects are one area of interest in the probe. In all, $30 million in state funding is held up

It’s not known whether the property purchase will shake any money free. When contacted by Straight News Online last week, state officials were unaware LCG had purchased the property in February. Louisiana Division of Administration spokesman Jacques Berry, who called Rigid’s purchase of the property last year “highly unusual,” says the state’s executive counsel and facility planning attorneys are reviewing the new information.

“They will weigh all the variables and decide how to move forward,” Berry says. He also says the legislative auditor’s ongoing investigation “will be a major factor” in reimbursement decisions.

“What can this property be used for? Not much, except maybe a little recreation. You greatly diminish the utility of the property by digging this huge pond.”

Local professional real estate appraiser

In an odd arrangement, LCG allowed its contractor to buy land targeted for a series of detention ponds along Coulee Ile des Cannes. LCG had attempted to strike a deal with the owners of that property on Ridge Road for $260,000, the value placed on it by an LCG-hired appraiser. But the owner wasn’t interested in selling at that price. After LCG’s Homewood project was halted by the court in May, Rigid stepped in, paying $433,0000 and granting LCG a permanent drainage servitude in exchange for LCG agreeing to buy the property at a later date for an undetermined sum.

It’s unclear whether LCG was required to seek a new appraisal in order to execute the February purchase from Rigid, though officials have indicated a new appraisal would need to be conducted. The value likely went down, one local professional real estate appraiser tells Straight News Online.

“What’s the market for a detention pond? People don’t go buy those detention ponds,” the appraiser says. “What can this property be used for? Not much, except maybe a little recreation. You greatly diminish the utility of the property by digging this huge pond.”

Mayor-President Josh Guillory has consistently maintained that LCG won’t pay more than appraised value to avoid “gratuitous donations” of taxpayer dollars. Under statutory law and the constitution, a political subdivision cannot pay a price that exceeds the appraised value; doing so may constitute a donation of public funds, according to an attorney general’s opinion.

The Feb. 17 transaction, filed in the court record the same day Straight News Online put in a public records request for any new appraisals on the Ridge Road property, means Rigid took a $183,000 hit. That might be an insignificant figure for a company that since November 2021, when its work for LCG began to ramp up, has taken in nearly $84 million in taxpayer money.

LCG has yet to respond to our request for any new appraisals.

The Coulee Ile des Cannes ponds were all but completed last year while work remained stopped by court order since May on the Homewood Drive ponds. LCG is said to be negotiating a settlement with those Homewood area property owners.

In its long-delayed response to council members’ questions about drainage, LCG reported in September that $42 million had been paid to Rigid Constructors for the Bayou Vermilion Flood Control Project and that it had been reimbursed just $19 million when payments from the state first stopped.

LCG initially planned to use some of its American Rescue Plan Act funding for the duo of projects, but consulting firm Deloitte determined that LCG’s process for selecting Rigid to build the flood-control project was not competitive enough to comply with federal procurement standards. LCG instead used a construction management at risk process, which allowed it to avoid public bid law in awarding the lucrative contract to Rigid Constructors.