$1 lease agreement causes complications in Iberia Parish - KLFY News 10

$1 lease agreement causes complications in Iberia Parish

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New Iberia is creeping up to the end of its fiscal year. And with a $2 million budget deficit they are scrambling to find new revenue streams including looking at their existing properties to possibly sell. New Iberia owns more than a 100 acres of land at the Port of Iberia which would provide a steady revenue stream for the city; except for the fact their leasing it out to the port for only $1 a year.

"That was back when the port had nothing and the land was doing nothing so we gave it to the Port of Iberia to make it more attractive for businesses to come, but it's 99 years we tied into a lease right now. We're trying to negotiate to see if the city can get some dollars," said Council member Dan Doerle.

But the original lease agreement was signed back in 1948, so the city still has 34 more years to go, which doesn't help their $2 million budget deficit this year.

"I think the mayor and the port director might be talking to see what can be done to help the city at this time," said Councilman Doerle.

Mayor Hilda Curry confirms that talks with the port are going on, but says "They are going nowhere" and she wouldn't say any more than that. Port Director Roy Pontiff says he's open to an agreement with conditions.

"It's in the port's interest to have a conversation with the city in regards to the lease. If we can negotiate a more permanent arrangement so that we have a little more stability 34 years from now to when the lease is," said Port Director Roy Pontiff.

Councilman Doerle says re-negotiating the lease could be a complicated process. "There's probably a bunch of financial situations that's entailed in that and some legal issues because they did some improvements."

Pontiff says those improvements add up to tens of millions of dollars.

"It was raw, undeveloped probably sugar cane land that value goes up. Like I said probably $8,000-10,000 an acre once we dig the slips and improve the property build bulk heads and stabilize the property with limestone."

Until a final agreement is drawn up, it is unclear how much the city could make but it could be in the hundreds of thousands a year.

"We probably have seven to eight tenants on the city's property and today generate about $600,000 a year in revenues," said Pontiff. But those are revenues the port also depends upon.

"The port is not tax supported. We don't have ad valorem or a sales tax that comes from the city so we generate or revenue by developing property and leasing that property." said Pontiff.

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