Crime Prevention and Improvement Districts - FAQs
What is a Crime Prevention and Improvement District?
It is a legislatively created political subdivision of the state with taxing and spending authority that follow the boundaries of a residential subdivision.
Why do neighborhoods create them?
It is a mechanism that provides for an annual assessment of a fee that is dedicated for crime prevention and improvement of the neighborhood. These districts are mostly used by older neighborhoods that do not have mandatory dues in their covenants and find that voluntary dues are not sufficient to provide for enhanced law enforcement activities and general maintenance of common areas.
Is the payment of the fee optional?
No, it is collected when a property owner pays his or her annual property tax and is collected per parcel.
How much is it?
The specific amount is authorized in the creating legislation but is generally somewhere between $75 and $200.
What can the assessment be used for?
The assessment can be used for crime prevention with expenditures for items such as off duty police/sheriff’s patrols and installation of law enforcement infrastructure (cameras, license plate readers). Also, if authorized, it can be used for improvements items such as landscaping of common areas (boulevard. medians, neighborhood entry areas), signage and improvements to the neighborhood for a common purpose.
How much revenue can be generated?
As the assessment is per parcel, it depends on the amount of the assessment and the number of parcels. A typical neighborhood could be say 450 parcels X $150/parcel to generate $67,500 annually.
Who determines actually how the money is spent?
The Board of the District is required to publicly adopt an annual budget.
What would a typical budget look like?
Perhaps ½ of the annual income stream could be budgeted for off duty patrols. In the case above $33,750 (1/2 of 67,500) would provide for 1,125 hours of off duty patrol annually or about 90 hours a month. The balance, $33,750, could be used for landscaping of common areas, rehabilitation/maintenance of any common structures such as lakes, pavilions etc.
Are there any downsides to a District?
As a political subdivision of the state of Louisiana the district is subject to public bid laws, State Ehtics Code and public meetings and records laws. Also, it must report expenditures annually to the legislative auditor.
If a neighborhood were to create a district would it need to continue to need a Homeowners Association?
Absolutely, as a political subdivision there are certain things that a district can not do such as architectural control activities, deal with zoning matters and take positions on various political issues such as 5-G towers. The District cannot represent your neighborhood in a public dialogue.
Can you be more specific on how a District is created?
Creation requires two major steps. The first step is to pass a bill in the legislative session. These are generally non-controversial as it is a local matter. But as a local matter, intent to file the bill must be advertised in the local paper prior to introduction so one must plan several months ahead of the session to have a bill introduced. The actual drafting is done by legislative staff and they have done this many times. Generally, your local legislator (House or Senate) will be glad to sponsor a bill on your behalf and move it through the process. Again these are generally very non-controversial.
What happens next?
Next the board must be appointed. Your enabling legislation will specify how the board members are selected. Generally, it is the President of the HOA, some members selected by the HOA, appointments by the local state Representative and Senator, and perhaps appointment by the local tax assessor, or mayor president. When you meet with your legislative sponsor or more than likely legislative staff after they are given permission to draft, you will discuss specifically how you want your board selected. Each board seems to be slightly different, but it is spelled out in your enabling legislation. After board members are appointed you have your first meeting, adopt meeting rules, you must also file necessary paperwork with the State Bond Commission and Secretary of State to be included in a state or local election.
This is the second, more complicated, step. Yes the Legislature creates the District but a vote of the residents of the District is required to assess the fee and this election must get on the next ballot. This requires some strategy as you must pay for your prorated share of election expenses to the Secretary of State. If it is a statewide election your prorated share is very small. If it is a local election your prorated share becomes larger so you must keep this is mind.
What happens after the election?
The track record for Districts passing is good. The more active residents in a neighborhood (the ones paying the HOA fees) tend to vote in favor understanding that with the creation of the District the cost sharing of common expenses and enhanced crime enforcement activity will be fairly allocated to all those receiving the benefit.
Now that we have created the district when will the funding be available?
You will get your first check in January after the election is certified. The process from advertising the bill until the first check can take two years depending on election schedule.
How much does this all cost?
About $3,000: At first just the advertising, but then filing fees for various public entities, legal professional services to set up board rules (and facilitate this process) and then the cost of being on the ballot.
Where does this come from?
In most cases the neighborhood homeowner’s association bears these costs.
Does a District Board Member have to file annually a Tier 2.1 Financial Disclosure with the La Ethics Commission?
You probably do not have to as Act 538 of 2018 exempts board members of CPIDs from the requirement if the district collects/spends less then $500,000.
For further information contact: Robert Harper ([email protected])
Home 225 767 6859 Cell 225 772 6859
DISCLAIMER: This is general information. For legal questions please contact an attorney.