October 2023

GOVERNMENT CONSULTANTS INC.
Is it Time for ‘The Fall’?
The fall season is always great here in
Louisiana. First, fall signifies the start
of FOOTBALL SEASON!!! Whether it’s
rooting for your favorite college team
or spending Friday nights under the
lights of a local high school – you know
it’s fall!!! Our Louisiana temperatures
are more bearable, and gumbo is always
on deck. Secondly, the beginning
of fall marks the end of another season
– summer!! And what a summer it has
been – record-setting heat is just one
statement describing the Summer of
2023. While enduring these extreme
weather conditions, we knew “the fall”
was coming – the fall of the temperature
and the humidity. We just had to
hold out for cooler days.
Now, let’s tie the previous paragraph
into what we have been experiencing
in the financial world: this past summer’s
record-setting temperatures represent
the high interest rates that have
been invading our world. And let’s not
forget the unstable inflationary season
we have been navigating since
2022. Taking just those two factors into
consideration - the borrowing costs
for families, municipalities, and businesses
are much higher than just two
years ago. When will the turbulent ride
in our financial world stabilize? When
will “the fall” happen for interest rates?
Let’s look at the facts and trends of the
Fed to see if we can predict “the fall”:
• In 2022, the Federal Reserve increased
interest rates seven times
– four times with an increase of
seventy-five basis points.
• This year, the Fed continued to increase
rates but at 25 basis points
at each meeting. During the FOMC
July 27th meeting, the Fed set the
rate at 5.25% - 5.50%.
• The inflation rate reached histor-
GOVERNMENT CONSULTANTS, INC.
Specializing in Bond Issues and Financing
L. Gordon King
Deatriz Riggins
Nnamdi Thompson
Shaun B. Toups
James R. Ryan
Jamie Holloway
Benjamin Bankston
(Consulting & Municipal Advisory Firm)
OVERVIEW
Modern day government has become a large financial
enterprise, handling millions of dollars and facing
service and revenue pressures. The governing
authority and Administrator(s) face complex financial
decisions ranging from the impact of property and
sales taxes to the financing of capital improvements.
As government finance has become more complex,
the need for financial advice to base decisions upon
has. The services of an expert Municipal Advisor are
being used by more and more governmental units.
A Municipal Advisor (or “MA”) serves as a
consultant advising the governing authority on
matters relating to the following:
• Financial feasibility of projects;
• Total cost analysis of financing alternatives;
• Review of capital improvement financing
programs;
• Advice on the structuring and marketing of debt
securities.
The MA is an integral member of the governing
authority’s management team, providing
independent advice and analysis to assist in financial
decision-making.
ECONOMIC DEVELOPMENT
FINANCE ANALYSIS
• Analyzing available alternatives in relation to
cost to the governing authority and providing
financial guidance and recommendations;
• Analyzing from a cost/benefit standpoint the
use of incentives (free land, subsidy of bond
issues, utility improvements) to attract
industry;
• Providing a detailed upfront and long-term
financial analysis of costs to the governing
authority versus benefits of the specific
project; and
• Serving as an economic development finance
resource for the Governing Authority.
6767 Perkins Rd., Suite #250
Baton Rouge, LA 70808
(225) 344-2098 (Phone)
gcla@gc-la.net (Email)
We Have The Experience!
Page 28
LMR | OCTOBER 2023