Opinion Number ( 1997 )

Dear Mr. Cahill:

This office is in receipt of your recent correspondence regarding the Town of Jean Lafitte's new sewer and sewerage treatment system. You advise that the Town has hopes of achieving 100% participation and would therefore like to pay for the initial "hook-up", at a cost of approximately $8.00 per foot, of potential system customers who comply with state, federal and local regulations. We assume that by use of the word "hook-up" you are referring to the installation, on each property, of the lines and equipment necessary to tie each property into the system. The Town does not plan to indefinitely pay for hook-ups, and has no plans to pay for the hook up of new construction. You have asked this office if it would be permissible for the Town to use Town general fund money to pay for these hook-ups.

Implicitly, your request must be examined in light of La. Const. Art. VII, Sec. 14, which generally prohibits the loan, grant and/or donation of public funds or property to any person, association or corporation, public or private. The Supreme Court has interpreted Art. VII, Sec. 14 to be violated whenever the state or a political subdivision seeks to give up something of value when it is under no obligation to do so. City of Port Allenv. Louisiana Municipal Risk Agency, 439 So.2d 399 (La. 1983).

In accordance with the provisions of Art. VII, Sec. 14, it is our opinion that the Town of Jean Lafitte may not assume the cost of the "hook-up", or installation of lines and equipment on private property, of potential sewer customers. Since the Town is under no obligation to provide lines and equipment on private property, the provision of same would be tantamount to a donation. In accord: Atty. Gen. Ops. Nos. 96-348, 90-498, 78-1562.

Please note that the Town is not prohibited from undertaking the installation of the lines and equipment on the property of a potential customer as long as the Town charges each customer a fee that is sufficient to defray the cost of the installation and materials used to provide that customer's "hook-up". Atty. Gen. Op. No. 95-221.

Should you have further inquiries we can assist you with, please contact this office.

Yours very truly,

RICHARD P. IEYOUB ATTORNEY GENERAL

BY: ____________________________ JEANNE-MARIE ZERINGUE BARHAM Assistant Attorney General

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