Opinion Number ( 2003 )

Dear President Davis:

You requested clarification of our opinion concerning a proposed revenue sharing agreement (the "Proposed Agreement") between Sales Tax District Number 3 of St. Tammany Parish (the "District") and the City of Covington (the "City"). You advised that the facts submitted in the original request contained an error which might have affected the conclusions drawn therein.

The District was created in 1986 and comprised the unincorporated areas of St. Tammany Parish (the "Parish"). Since 1986, the unincorporated areas of the Parish have changed as municipalities have annexed property. Bonds were issued by the District so the boundaries of the District have not changed with the municipally annexed property. Since 2000, the Parish and the cities within the Parish have negotiated agreements to ensure that there is a process by which properties within the municipalities and also within the boundaries of the District received the benefits from the sales tax produced in that area. Our original opinion only pertained to unincorporated areas of the Parish which abut but are not included within the geographic boundaries of the District.

The use of the proceeds of a sales tax adopted at an elected in the State of Louisiana is dictated solely by the proposition approved by the voters. R.S. 33:2723, R.S. 33:2714; R.S. 39:704; Op.Atty.Op. Nos. 02-0365, 01-269, 98-287, 96-246, 95-145, 94-540, 94-346, 93-424, 93-47 and 92-50.

The proposition which you supplied to this office provides that the proceeds of the District's tax are to be dedicated and used for the following purposes:

"1. Constructing, overlaying and improving Priority I and Priority II roads, streets and bridges in the District . . .; and

2. Repairing and maintaining roads, streets and bridges in the District . . ." (Emphasis added)

As the newly annexed areas are still "in the District", it is the opinion of this office that use of the sales tax proceeds in those newly annexed areas would be in compliance with the sales tax proposition.

Trusting this adequately responds to your request, we remain

Yours very truly,

RICHARD P. IEYOUB Attorney General

BY: __________________________ MARTHA S. HESS Assistant Attorney General

RPI/MSH