Together Louisiana calls payment in lieu of taxes proposal ‘corporate giveaway’
Together Louisiana is mounting a campaign against proposed legislation that would allow local taxing authorities to negotiate contracts with manufacturers to pay an upfront set fee in lieu of property taxes, which organizers say effectively amounts to a tax exemption.
The organization also called attention to five other bills proposed for the 2018 regular legislative session and four existing laws, which it dubbed the “Top 10 Corporate Giveaways of 2018” during a Together Louisiana meeting held today ahead of the opening of the session and the governor’s speech.
The “payments in lieu of ad valorem taxes,” or PILOT, would require a constitutional amendment and a simple statute giving local governments authority to enter into “cooperative endeavor agreements” with manufacturers. The effort involves four proposed bills: House Bills 201 and 254 sponsored by Rep. Raymond Crews, R-Bossier; and Senate Bills 294 and 346 sponsored by Sen. Mike Walsworth, R-West Monroe.
Together Louisiana organizers Edgar Cage and Broderick Bagert say these bills would allow “limitless property tax giveaways to industry negotiated by contract.” The issue, Bagert says, is that these deals do not require manufacturers to pay an amount equal to what they would pay in property taxes.
PILOT supporters say it would allow local government entities to receive money early that can then be spent on education and infrastructure needs—in contrast to the Industrial Tax Exemption Program, or ITEP, in which local entities don’t receive property tax payments for five to 10 years.
The effort resembles a bill sponsored by Rep. Alan Seabaugh, R-Shreveport, and supported by Gov. John Bel Edwards last year. The bill passed the House but was defeated in a Senate committee, largely due to the opposition of parish assessors, who argued allowing each taxing district in a parish to make deals with manufacturers would cause chaos.
Together Louisiana organizers listed five additional bills that will come up in this year’s regular session and could also be considered corporate giveaways, and encouraged its membership to lobby against them:
- Senate Bill 34: Authorizes a city or parish school board, or a parish governing authority, to discuss economic development projects in executive session.
- House Bill 248: A constitutional amendment authorizing a local option for local governments to establish percentages of fair market value for property classifications used in determining the assessed valuation of property for purposes of ad valorem tax.
- House Bill 684: Provides relative to tax incentives granted by local governments for donations to local governments.
- Senate Bill 65: Provides for incentive rebates under the Quality Jobs Program.
- House Bill 501 and Senate Bill 365: Provides for the Louisiana Installment Loan Act/LOANS.