LA TAX EXEMPTIONS – Property Tax Exemptions are a tool that states use to attract businesses to either locate or expand manufacturing operations. This next story gives you a glimpse at how companies try to get as much property approved to save taxes. Louisiana’s Board of Commerce and Industry advises on the Louisiana tax incentive applications. Yesterday, a galvanizing company tried to get a questionable item through Industry Tax Exemption Proposal application, The company's representative, Don Allison, first tried explaining to the board that they had received a prior industrial tax exemption, when they originally erected their office building in 2011.
"The exemption did apply to the office building," Allison declared. "They doubled the size of the existing office building, therefore we think it should apply to the expansion of the building." But Senator Robert Adley, a Republican from Benton, LA who is Gov. John Bel Edwards' representative to the board which grants tax exemptions, had this to say: "This board has the responsibility to determine whether or not items fall inside what you deem to be 'manufacturing,'" Adley stated, "And this is not an expansion to a line. It's not hiring new people. It's just building a new office building." But company rep Allison asserted "The galvanizing operation could not operate without the office building — you know, the administrative part of the business — that supports it!" To which Sen. Adley responded: ""The constitution clearly says 'part of the process of manufacturing' — making the product, Desks and chairs and file cabinets are clearly not part of that." As discussions wore on, Sen. Adley offered the company representative a solution-- simply removed the office space from tax exemption consideration. The company's representative Allison maintained that they had a legal which offered qualification for the exemption. Then Sen. Adley said this: "OK, push it if you want to, but once it gets up there on his desk, he's going to say no. And when he disapproves the entire amount, let the record reflect that you had an opportunity to remove the $104,000 office space, and continue to get a million dollars in property tax exemption."
Adley was referring to the likelihood of Governor Edwards disapproving the entire application. So what was the outcome? After a brief huddle, the company conceded and removed the office building for tax exemption… and so now you have a better idea of how the process works. Public Radio WRKF contributed to this report.
