Economist: La. will be one of the last states to exit recession

A new forecast says Louisiana will be one of the last states to get out of the recession, with employment growth not resuming until the third quarter of 2010. "It's kind of a first in, first out situation," says Mike Zoller, an associate economist with Moody's Economy.com, which did the forecast. Moody's notes that Louisiana didn't enter the recession until October, about 10 months after California, and the state didn't record a year-to-year drop in the number of jobs until April. There's been a split between the economic fortunes of north and south Louisiana, Zoller says. While the southern portion of the state has held up well because of hurricane rebuilding, the manufacturing industries in the northern part of the state have been hit by the national downturn. "Also, the Haynesville natural gas field is not growing as fast as expected," Zoller says. The recession in Louisiana hasn't been as bad as the rest of the nation, but the drop in offshore oil drilling has been "a thorn in the side," he says. Moody's says five states should exit the recession by the fourth quarter of this year: Colorado, Idaho, Oregon, Texas and Washington. Those states are benefiting from their strong high-tech industries. For a map of Moody's forecast, click here.—Timothy Boone

Business college to seek funding plan approval

Eli Jones, dean of LSU's E.J. Ourso College of Business, says a novel plan to finance construction of a new building is almost ready to be presented to the LSU Board of Supervisors for approval. Jones hopes to tap into a federal program called the federal New Markets Tax Credit. Although the program is normally used for economic development projects in rural or other low-income areas, Jones says the $60 million business complex project qualifies because of LSU's location and the business school's positive impact through teaching students skills to become economically productive. The LSU business building project is $12.2 million short of the $30 million it needs for another $30 million in state matching funds. "It's a very complex program, and we are still working hard behind the scenes to pull all the paperwork together before going to the board of supervisors for approval," Jones says. "We will likely be ready for the July meeting."—Steve Clark

Two cents: Another black eye

What Rep. Regina Barrow of Baton Rouge, Rep. Clif Richardson of Central and other members of the House Municipal, Parochial and Cultural Affairs Committee did yesterday on HB 877 is absolutely disgusting.

I'm not talking about the specifics of the TIF-related bill, which has dropped developer Mike Wampold's proposed Bluebonnet project and replaced it with a request from Tommy Spinosa to get tax increment financing for a proposed limited-service hotel in Perkins Rowe. [Wampold asked to be removed from HB 877, opting to cast his TIF-lot with SB 333 which already has Senate approval and awaits a full vote in the House.]

What's appalling is the procedural garbage that allows a defeated measure to be brought back for debate after opponents—both in the crowd and on the committee—left the room. The bill, which was defeated 8-6, was reintroduced two hours later after all but three of the earlier "no" voters (and all of the opponents in the audience) left the room and three other members, not present during the original vote, joined the committee meeting. On the second go-round the measure, sponsored by Richardson, passed without objection. [Richardson is a good friend of Bobby Simpson, the former Baton Rouge mayor and current Spinosa employee.]

This, on top of the stunts by Rep. Avon Honey and Rep. Steve Carter earlier in the session, gives not only the Legislature a black eye—but the Baton Rouge delegation in particular.

It's true that I personally do not support giving a TIF to Wampold's hotel and conference center project. I have even stronger objections to giving TIF status to a cash-strapped Spinosa and his proposed limited-use hotel project. But that's a different argument for a different day. The outrage isn't the substance of the bill; it's the way it was handled.

It's because of nonsense like this that people have so little faith in government. And rightly so.

Send comments to editors@businessreport.com.—JR Ball

This story has been changed since it was originally published.

Publisher: Government isn’t the solution

In 31 years, General Motors has gone from worrying about being broken up by the government to being taken over by the government, says Business Report Publisher Rolfe McCollister. "If poor management is the problem, how is putting government in charge going to fix it?" McCollister says. Plus: Jindal's critical plans to streamline government and a salute to women business leaders. Read the column here. Send comments to editors@businessreport.com.

FNBB launches insurance agency

Baton Rouge-based First National Bankers Bankshares Inc. has launched the FNBB Insurance Agency, an in-house insurance arm to offer policies to the financial institutions it serves. FNBB brought senior vice president Delvan Irwin on board two weeks ago to spearhead the agency, which will offer directors and officers liability, financial institution bond, property and casualty, mortgage impairment programs and lenders single interest among others. “FNBB wanted to create and staff an agency that that would match the services already offered to its member banks,” Irwin says. Based in Ridgeland, Miss., the insurance agency will serve all banks within FNBB’s four-state footprint as well as outside financial institutions, Irwin says. “There’s an insurance agency on every street corner,” Irwin says. “What makes this agency special is that none of those agencies can sit down with you and explain the different exposures a bank has that everyone else doesn’t.” Irwin’s goal is to be a leader in providing insurance to financial institutions that may or may not be FNBB member banks. First National Bankers Bankshares Inc. is the parent company for First National Bankers Bank in Baton Rouge, Mississippi National Banker's Bank in Ridgeland, Miss., First National Bankers Bank, Alabama in Birmingham, Ala., and Arkansas Bankers Bank in Little Rock, Ark.—Emma James

Maxwell's Market plans Highland location

Maxwell's Market has signed a lease to build a third Baton Rouge location in the Highland Market shopping center. Ron Lewis, who owns Maxwell's, says he hopes to open the grocery store/deli/restaurant by Nov. 1. The location, across from Ruffino's, is slightly larger than the Maxwell's on Corporate Boulevard and Perkins Road. "We think this is an underserved market," Lewis says. "We have a lot of customers who live out in Santa Maria, Country Club of Louisiana and Ascension who said they wish we were closer to them." Lewis has applied for rezoning to allow Maxwell's to serve beer and wine; that request is set to go before the Planning Commission on June 22.—Timothy Boone

Businessman: 1,500-job deal possible in Monroe

A Ruston businessman who last year bought a defunct headlight plant in Monroe says a deal could be in the offing for as many as 1,500 jobs. James Davison says he's an investor in the project, for which Mississippi and possibly Alabama are competing. Davison and state and local economic development officials say it would involve assembly, but confidentiality agreements keep them from giving any other details. If it goes through, says Davison, the 425,000-square-foot plant built by Guide Corp. would have to be doubled in size. Monroe Mayor Jamie Mayo says the city, state and Davison have been working on an incentive package.

Report: La. manufacturing jobs down 1.7%

The number of industrial jobs in Louisiana dropped by 1.7% from April 2008 to April 2009, the first statewide loss since hurricanes Katrina and Rita. But Manufacturers' News Inc., the industrial publisher that compiled the list, notes employment in Baton Rouge was unchanged, with more than 15,800 workers. New Orleans industrial employment dropped by 9% over the year, down to nearly 11,500 workers, while Shreveport saw a 14% drop, to 9,850 industrial workers. Louisiana lost 3,385 industrial jobs over the past year, with the majority of the declines coming from north Louisiana. That region has been hit by the shutdown of an International Paper mill in Bastrop. Overall, Louisiana has more than 199,000 manufacturing workers, with the largest sector being in the chemical and allied products field.

Poll: Most agree with FBI crime ranking

The majority of respondents to a Daily Report poll say they agree with a recent FBI report says that Baton Rouge has the county's seventh-highest murder rate. Fifty-eight percent of people who took the survey say Baton Rouge is dangerous. Thirty-five percent say they disagree with the rankings and the city is not that dangerous, while 7% are undecided. Nearly 1,350 people participated in the poll.

Today's question: Should state workers get a 4% merit pay increase this year?

News roundup: Retailers report drop in May sales ... Judge: Chrysler has good case for franchise cuts

Bargain shoppers: Many U.S. retailers said same-store sales fell in May, as expected, as shoppers continue to spend cautiously, focusing on bargains and food. The declines came largely in line with analyst expectations, with frequent standouts such as The Buckle Inc. posting better results. Cheap chic discounter Target reported a bigger drop than analysts expected, as apparel and home products continued to be weak sellers. Overall, necessities like food and health care products continued to be the strongest sellers. According to a preliminary tally by Thomson Reuters, 13 retailers missed estimates, five retailers beat estimates and one matched expectations. "There's general softness across the board, as consumers continue to face rising unemployment, falling home values and rising gas prices," says Ken Perkins, president of retail consulting firm Retail Metrics. He expects same-store sales to fall 3.6% overall.

Could clear the way for closures: The judge overseeing Chrysler's bankruptcy case says the automaker has a good case for the termination of 789 of its dealer franchises as part of its ongoing restructuring. U.S. Judge Arthur Gonzalez says under Chrysler LLC's plan, those dealers, which represent about 25% of the company's dealer base, will remain with "Old Chrysler," a collection of assets that aren't slated to be sold to a group led by Italy's Fiat Group SpA. Since those leftover assets won't be making vehicles, there would be little use for the dealers that would go with them, Gonzalez says. "If the sale would be consolidated, there's a strong argument that no dealer network would be needed," Gonzalez says.