Gov. Edwards to enforce sunshine provision in ITEP program
Gov. John Bel Edwards said today he will require Louisiana Economic Development and the state Board of Commerce and Industry to enforce a provision in the new rules governing the state’s Industrial Tax Exemption Program, or ITEP, intended to make it easier for the public to see which companies are applying for the tax break and how much they’re asking for.
The sunshine provision was written into the new ITEP rules drafted by the Board of Commerce and Industry in 2016, following an executive order by Edwards giving local governments more control over the administration of the lucrative incentive. But the provision was very narrowly interpreted by staff at LED and, therefore, has never been enforced.
At a meeting of Together Louisiana, which supported the governor’s changes to ITEP and has since expanded its agenda into a broader economic philosophy, Edwards committed to enforcing the transparency provision.
The crowd of delegates and several hundred attendees at the lunchtime meeting at University Baptist Church gave him a standing ovation.
The rule requires companies applying for an industrial tax exemption with a local government to disclose to the state what they are applying for and that LED, in turn, post the information on its website within three days. As a practical matter, that information is already available to local governments, but the idea is to have all the applications posted in a single place, easily accessible to the public.
Though LED has narrowly interpreted the sunshine provision, former state Rep. Robert Adley, chair of the Board of Commerce and Industry’s rules committee, said after the meeting it was always the intent of the board that ITEP applications be made public on a statewide website from the outset.
“With the governor’s involvement now, I think we will get back to the intent of the provision,” he said.
Adley added he does not expect corporate applicants of the program, many of whom have been wary of the ITEP changes, to have a problem with enforcement of the sunshine provision since the information is already public anyway.
In other parts of his speech, Edwards reiterated his philosophy with respect to incentives like the industrial tax exemption: The state should not offer more in incentives than it can afford, there has to be a good return on the investment and the focus of incentive dollars should be on jobs created.
“Reasonable people can disagree about where to strike a balance,” he said. “But it is unreasonable to say we were in a position of prosperity before.”
Edwards told the crowd he is proud of steps taken during his 22 months in office to improve the economy and quality of life for everybody in Louisiana. He cited the expansion of Medicaid—which has led to a decreased in the state’s uninsured from 24% to 10%, criminal justice reform, an unemployment rate that has fallen from 6.2% to 5.1%, and a stable, balanced budget with a mid-year surplus of $100 million.
But Edwards said there is still a long way to go, citing the need for comprehensive tax reform and a solution to the $1.1 fiscal cliff the state will face in July, when temporary sales taxes expire.
Edwards also said he remains committed to increasing the minimum wage above $7.25 an hour to a true “living wage,” and to closing the gender pay gap.
“I’m offended we have the highest pay gap in the nation,” he said.