Where in the World Is Jr. Shelton? by Woody Jenkins, editor, Central City News

Matt Talbert moved to Sterlington, Louisiana, 15 miles northeast of Monroe, in 2005. He and his wife loved the small town Christian atmosphere where everyone knew each other and where schools were outstanding.  It was perfect for their son and daughter.  Matt became general manager of a family-owned chain of quick oil change stores and car washes.

In 2018, Matt Talbert became concerned about the government in his town.  He knew something wasn’t right, and he wanted to fix it.  He ran for and was elected to the Sterlington Board of Aldermen.  Four of five members of the board were new and had no experience.

Just 41 days after taking office, Matt Talbert and other members of the Board of Alderman received shocking news.  Sterlington was nearly bankrupt and was being taken over by the State of Louisiana.

The town, with a population under 2,000, had a debt of $21 million, thanks to a massive bond issue, and it could not service that debt or even pay day-to-day expenses.

“It was an unbelievable situation,” Alderman Talbert said, “We couldn’t pay the first bill!”

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In accordance with Louisiana law, Legislative Auditor Daryl Purpera appointed a Fiscal Administrator to take over and operate the town, in lieu of bankruptcy.  Purpera appointed former Central Mayor Jr. Shelton for the task.

Alderman Matt Talbert said, “When I told officials from other cities at the Louisiana Municipal Association Convention we were getting a Fiscal Administrator, they gave their condolences and said it would be terrible, like a dictatorship.  When Mayor Jr. Shelton arrived in town, none of us knew what to expect!”

Under Louisiana law, the Fiscal Administrator of a municipality is much like a Bankruptcy Trustee. He has almost total authority over the city government.  His decisions supercede those of the mayor and city council, or in Sterlington’s case, the Board of Alderman.

The $21 million in bond money had been spent for a baseball and softball facility that was supposed to attract tournament play from throughout the state and nation and for improvements to the sewer system. 

Unfortunately, the revenue from the ball fields and a special one-half cent sales tax could only produce about $200,000 a year — far short of the $700,000 a year needed to service the bonds.

The problems with bonded indebtedness spilled over into the town’s day-to-day operations. Bills were going unpaid, and town employees were being laid off.  It would have been an untenable situation for a private business and unthinkable for a municipality.

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The Town of Sterlington had a population of 1,599 in the 2010 census.  By 2018, the Census Bureau estimated there were 2,724 people, and Sterlington was heralded as the fastest growing municipality in Northeast Louisiana or perhaps the state.  However, today those figures appear inflated and most officials think the 2020 census will show under 2,000 residents.  

The business community of Sterlington is small, and there is no downtown area or city center. The Waffle House has hours. There’s a Sonic and a hardware store.  There was a Fred’s, but it has been replaced by Brooksher’s, which is similar to a Neighborhood Wal-Mart. City officials thought Covid would hurt the town’s sales tax revenues, but local businesses had a record year.

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Before Mayor Shelton was appointed, the Aldermen said they discussed every conceivable solution.  But most of the ideas were either unworkable or too unpopular for the public to accept.

Alderman Zach Howse, another first-time member of the council, said things in Sterlington haven’t always been so bleak. On the contrary, he said, “Until late 2018, most people in Sterlington felt things were going pretty well. We were the fasting growing city in the state, and we had a beautiful ballpark.  The town was seeing the world through rose-colored glasses, because, at the same time, we were racking up a mountain of debt and our sewer system was falling apart.”

The bottom fell out when Mayor Vern Breland resigned shortly before the November 2018 election, “Everyone could see that something was terribly wrong,” Alderman Howse said.

Since then, former Mayor Breland has been charged with one count of malfeasance in office by District Attorney Steve Tew.

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Howse and the other aldermen took office in January 2019. Shortly thereafter, members of the new Sterlington Board of Alderman were summoned to Baton Rouge for a fiscal review meeting conducted by the Legislative Auditor.

Howse said, “We were asked about our financial status and how we were going to get out of it.  The meeting did not go well.  We had the right plans for getting the town back on track but did not have the power to enact them.  We realized that we needed a fiscal administrator who could make things happen.” 

“There was another problem. Because we were a new council and inexperienced, many people in Sterlington didn’t trust that we knew what we were doing. They wanted to wait for the Fiscal Administrator to arrive and set things straight.”

The Board of Alderman had been looking at a plan to raise sewer rates from $35 a month to $68 a month — a very large increase. “People in town thought that was outrageous and that the Fiscal Administrator would reject any such increase. Unfortunately, that was the amount needed to pay for badly needed sewer improvements,” he said.

The Economic Development District created to build the baseball parks had taxing authority but it would take another one-cent sales tax to service the debt on the bonds, something the citizens of Sterlington could not accept.

The town was in gridlock. No solution seemed possible.  Everything had ground to a halt.  Town government was at a standstill. Something had to be done.

***

Before he arrived in Sterlington, Jr. Shelton spent a lot of time going over the numbers.  “I found the situation in Sterlington to be extremely difficult but not impossible.” 

“When I arrived, all you could see was debt, and it was hard to tell what was real and what wasn’t. We knew the bonded indebtedness was real and could not be cancelled.  However, there were some claims against the town that were not legitimate. The town operated a utility company. That was real and provided revenue for the town.  But the stream of revenue was not sufficient to pay city expenses, much less service the debt from the ball fields and sewer improvements.”

Mayor Shelton said, “It soon became clear that sewage fees had to be raised to make improvements.  Likewise, it would take an increase in the sales tax in order to service the bonded indebtedness. We would have to be frugal, even to make that work.” 

“One of the first things I did was get on the phone with creditors and tell them I was onboard and that 

they would be taken care of, but also to give us some time to put everything in place.

“Starting with the good ideas of the Board of Aldermen, we developed a plan,” Shelton said.  “The Board had already raised sewer fees. They had a forbearance agreement with the bond holders.  We worked on a plan to make sure all sales tax revenues went to pay bonded indebtedness.  We developed procedures for paying down operating expenses. Perhaps the most difficult thing was imposing a one-cent sales tax in the Entertainment District.  The tax is only paid by people who go to convenience stores and restaurants.  However, these are the very people who are drawn to Sterlington by the ball parks.”

“Today, Sterlington is in a very different place from when we began this process.  There is a plan in place.  There are processes and procedures in place.  All of our bond obligations are being met, and we are paying operating expenses as they come due.  Furthermore, we have $500,000 in the bank! That’s not a lot but Sterlington is well on the road to being a municipality that is financially sound.”

***

Alderman Matt Talbert said, “Even though Mayor Jr. Shelton had total authority over our town, he didn’t approach it that way.  On his first visit, we sat down and he said, ‘Look, I want your input and ideas. When I leave, you’ll have to live here and be part of this town.’”  

Alderman Talbert said, “From Day One, he made himself available to us — day and night. He gave us his cell number and his email. We could call him at any time and we did! We spent hundreds of hours on the phone brainstorming about what might work and what might not work.”

“Being an Alderman in Sterlington is hard work, but all of us also have full-time jobs or businesses. When Mayor Shelton came to town, he tried to meet with us at our convenience — before work or at night, whenever we could make ourselves available,” he said.

Talbert said, “As a first-time alderman, I learned invaluable lessons from him. He taught us how government works.  He is not one to come with his idea and say that’s the way it will be.  He listened to our ideas, and if our ideas were better, he went with them.” 

***

Mayor Shelton said, “The most important thing we had going for us was that we had good people to work with who loved their community and wanted to find realistic solutions.”

Shelton said Sterlington has much in common with Central, although it is much smaller. The town is composed of hard-working conservative, Christian people who greatly value their public schools, which are outstanding.  The town is 84 percent white, 12 percent black, and 4 percent Latin.

Sterlington was incorporated in 1961. Shelton said, “One of the smart decisions Sterlington made some years ago was to annex property along Hwy. 165. The community doesn’t have a downtown or a city center, and the businesses along Hwy. 165 are essential to serve the community and to provide sales tax revenues to the town.” .

Literally across the street from the Town of Sterlington is the Angus Chemical Plant, owned by Dow Chemical. It’s been there since 1930 and provides 204 full-time and contract jobs.  This makes a tremendous impact on the local economy. However, because it is outside the city limits, the plant does not pay taxes to the Town of Sterlington.

***

How did Sterlington get in so much trouble?  That is a question that could end up in a court of law, since the former Mayor has a pending charge against him of malfeasance in office.

However, one thing seems certain: The numbers used to justify the issuance of $21 million in bonds to pay for ballparks and sewer improvements could not reasonably have been expected to generate enough revenue to service the bonds.  Add to that the fact that nearly Ruston and Monroe also spent large sums to build massive ballparks in their cities, creating unexpected competition for Sterlington.

Beyond the decisions of the former Mayor and Council, many people involved in town government today point to the Louisiana Bond Commission as a large part of the problem.

The Bond Commission was created to make sure that bonds issued by the State of Louisiana and its political subdivisions make sense and can be serviced.

How the Bond Commission could go so far wrong has not been disclosed.  To allow a small town with fewer than 2,000 residents to issue $21 million in bonds.

The former Mayor of Sterlington, Vern Breland, was well known in the state and politically influential.  He had even served as President of the Louisiana Municipal Association.

Many people blame the State Bond Commission for approving bonds that couldn’t be serviced.  Others say you can’t blame the bond commission because lending banks apparently thought the projects were good enough to make the loans.  Others blamed the banks for not doing their due diligence.  Others say look to those who gave the banks bad information.

In any case, the taxpayers of Sterlington are now on the hook for debts that were supposed to be paid from self-generated funds, and neither the state nor the banks have lost a penny.

***

In Sterlington, life goes on. The controversy over the ball parks and higher sewer fees and sales taxes has subsided.  The current controversy is about low income housing moving into town.

The residents keep working. A few new businesses are springing up. Sterlington Alderman Zach Howze started a new business himself.  After 15 years in child care, he decided to become a restaurateur.  “Can you image getting into the restaurant business in the midst of a pandemic!” he laughed.

His pizzeria offers pizza, burgers, and wings.  His wife, a hair stylist, just quit her job and works with Zach at the pizzeria.

***

Alderman Howze said Covid ended up being a blessing for Sterlington — a terrible blessing in disguise.  He said, “It showed us what a wonderful town we live in and how much we love each other. We have really rallied together!”

“I believe the future of Sterlington is bright.  However, we have to decide whether we will slip back into the good ole boy politics of the past or set new standards for ourselves and our community going forward.  This will be decided by the people who get involved and try to make a difference.  It will be interested to see where the people want Sterlington to go in the next election in October 2022.” 

***

Mayor Shelton said a number of other municipalities across Louisiana are in trouble too.  Some have Fiscal Administrators and others are on the verge of it.  He said some of them are dying cities where people have moved away, leaving not enough residents to meet the obligations of the town.

What is future of Sterlington?

Mayor Jr. Shelton said, “Unlike some towns with fiscal problems, Sterlington is not dying. In fact, it is growing.  Sterlington is a wonderful community and a great place to raise a family.  I believe it has a bright future! In addition, I have a high degree of confidence in the current Board of Aldermen.  They have the best interests of their community at heart.  They’ve learned a lot, and they have put in place safeguards on future officials.  I can’t say enough about the Aldermen I have been privileged to work with.” 

“After I wrap up my work in June, the Mayor and the Board of Alderman must continue to be frugal and conservative with their spending.  If they do that, and I believe they will, the Town of Sterlington will be on solid ground for the future!”

***

As to Jr. Shelton, Alderman Zach Howze said, “Mayor Shelton has done a fantastic job for us.  He is a lifelong friend now.  H e knew when to step in and when to let us take the lead.  He knew when to fight and when not to fight.  Our citizens really don’t know how instrumental he has been in getting this done.  People didn’t think we would back the Council, but he knew when to take the heat, and he did.  He never sought the limelight but focused on getting things done.  He will leave us with policies in place that have never been there and real hope for the future.”

Howze said, “We loved having Jr. with us!  We want to thank the people of Central for sending him to us.  He is a true friend and mentor, and he has blessed us!  He will be missed!”

Alderman Matt Talbert said, “Of course, we are all ready for this to end, but we are not ready for Mayor Shelton to stop coming up here every week.  He is an amazing public servant, a mentor, and a true friend.  I don’t intend to lose that, and I will stay in touch with him for as long as possible.”