The Baton Rouge Area Chamber today released a commentary by Michael DiResto, its senior vice president for economic competitiveness, in which he urges lawmakers to preserve economic incentives and resist across-the-board cuts to the incentives as they work to fill a $1.6 billion budget gap.
“Filling a $1.6 billion budget hole is understandably a difficult task confronting legislators, particularly as they grapple with efforts to protect vulnerable priorities like higher education and health care,” DiResto says in the commentary. “What’s troublesome, however, is the sweeping and permanent nature of some of the measures making their way through the legislative process, which, if passed into law, could severely hamper Louisiana’s job-creating momentum.”
DiResto notes major project investments statewide, either announced or already underway, have been pegged conservatively at $60 billion and as high as $100 billion in the coming years. Of that, estimates on investments in the Baton Rouge area range from $15 billion to $23.7 billion, according to the Greater Baton Rouge Industry Alliance. In addition, DiResto notes, economist Loren Scott projects that the Baton Rouge area could see the addition of 21,700 jobs over the next two years.
“Tax incentives play a vital role in this success,” DiResto writes. “While projects are rarely determined solely on incentives, these programs do play a critical dual role of first attracting attention to a state that has historically been ignored, and second, of providing a difference in the final decision against stiff competition, like Texas.”
Of particular concern to BRAC are House Bills 629 and 635, which the organization says would impose across-the-board cuts of up to 28% to numerous tax credits and rebates.
“While applying these tax changes across-the-board seems, on the surface, like an exercise in fairness, in reality, just like across-the-board spending cuts, they have the practical effect of arbitrariness—treating all programs the same regardless of their importance, performance, or priority,” DiResto writes.
