If Louisiana communities along the river region want a boom without the bust, now is the time to start planning for the many industrial expansions coming to the area. This was the message of a recent panel discussion held by the Center for Planning Excellence in Baton Rouge, Louisiana. Louisiana’s river region will need multisector, cross-jurisdictional collaboration that includes industry in order to prepare.
Representing industry during the panel was Tom Yura, senior vice president and general manager of the BASF site in Geismar, Louisiana. Yura spoke about the efforts already underway on the part of industry to look at infrastructure needs in this region.
“Industry and trade association groups will sit and meet regularly and start producing tons of data,” he said. “We find out information such as what the projects are, where they’re going to go and the number of people they will need including craftsmen and permanent employees. This is all for planning purposes. But if there’s no plan that comes after the data and information gathering, then there’s not a lot that happens with it.”
The river region in Louisiana includes the following parishes: Ascension, Assumption, East Baton Rouge, Iberville, Jefferson, Lafourche, Orleans, Plaquemines, St. Bernard, St. Charles, St. James, St. John the Baptist, Terrebonne and West Baton Rouge.
In terms of short-term planning, Yura said industry will take small-term actions whether it’s hiring off-duty police officers, setting up parking rides, alternating shift schedules or changing work hours. “All these things can provide temporary relief to level out some of the transportation issues,” Yura said.
According to reports and fiscal projections, the property tax revenues associated with the Louisiana industrial expansions won’t impact local budgets for approximately 10 years. This could create a struggle for municipalities trying to meet infrastructure needs. Yura said there are alternatives to not only incentivize development but also help localities get the revenue they need to keep up with infrastructure.
“Although there may be a 10-year property tax abatement, you still have plenty of tax revenue coming in including sales, use and employee taxes,” Yura said. “You can have other systems where you pay property tax upfront and then give rebates on the back side. You have places like Michigan that will waive property tax for good to bring in a facility and the multiplier jobs that come with it. It’s debatable whether this makes good fiscal sense long term.”
Yura said the state has done a great job providing programs such as Louisiana Economic Development’s FastStart® to attract companies. He also explained what’s going to happen with the industrial expansions in Louisiana in regard to tax revenues, which he said should be an acute issue.
“Typically, when you have one plant coming off the tax abatement, another one is coming on,” Yura said. “But we’re dealing with a massive amount of projects at once, plus we have a backlog of projects at the same time. Industry is always open for alternative funding mechanisms and alternative exemptions to make sure we can obviously be a big part of the solution.”
Yura closed by explaining how important it will be for the industry to advocate for effective planning and solutions in the river region.
“There’s no way to hide from what’s coming, and we need to make this an issue for our elected officials,” he said. “I’ve heard people comment about how we’re solving the issues of fuel efficiency but it’s not generating tax revenue to repair and maintain our roads. So while we’re celebrating fuel efficiency, we have other problems. One solution causes another problem, and the communities in the river region are going to have to recognize that we have to be different. We’re going to have to do things we haven’t done in the past to plan for what’s coming.”
For more information, visit www.cpex.org or call (225) 267-6300.
