BATON ROUGE, La. (AP) -- Gov. Bobby Jindal proposed legislation Thursday to expand business incentive programs, including property tax breaks and payroll rebates, in a bid to attract new industry and corporate headquarters to Louisiana.
The governor wants lawmakers to rewrite corporate income and franchise tax laws, expand a local property tax exemption program, offer a new incentive for certain businesses that create high-paying jobs with benefits and create a rebate for location costs when a company moves its headquarters to the state.
"We want to give our economic development leaders, both at the state and local level, the tools they need to continue to bring jobs to our state," Jindal said at a Baton Rouge-based technology park, surrounded by the lawmakers who will sponsor the proposals.
The Legislature will consider the four bills in the regular session that begins March 12. The state economic development department estimates the proposals would have no cost in the upcoming 2012-13 budget year. They could cost up to $16 million in the fifth year in lost state tax revenue.
"These will be offered on a very targeted basis," Jindal said.
The measure with the highest price tag would expand a 10-year local property tax exemption currently only offered to manufacturers. Jindal's proposal would allow parishes to offer the tax breaks to more companies, like digital media businesses, data centers, renewable energy firms and corporate headquarters.
The property tax break expansion would require a constitutional change approved by voters in a statewide election. Jindal's proposal also would require parish governing bodies to decide if they want to participate before the tax break could be offered to companies as part of a state and local incentive package. The proposal is estimated to cost up to $25 million in local tax dollars by the fifth year.
The other bills would:
—Change the calculation that certain companies use to determine their state corporate income and franchise taxes. They would be able to base their payments on the amount of in-state sales taxes they generate, rather than on a mix of sales, property and payroll factors. This would lessen tax payments for those allowed to participate. The state already allows manufacturing facilities to use this calculation.
—Increase the payroll rebate offered to certain companies who create high-paying jobs with health care benefits, from 6 percent to up to 15 percent. This would be offered on a case-by-case basis by the economic development department. The industries targeted include aerospace businesses, research and development firms, pharmaceuticals manufacturing companies and renewable energy businesses.
—Give a 25 percent rebate over five years on relocation costs for companies that move their corporate headquarters to Louisiana. The businesses would need to pay salaries of twice the average pay given by private businesses in the parish or at least $60,000 annually, under the proposal described by Jindal.
"This is a package of bills that has worked very well in the manufacturing industry. We're going to try to expand that," said Rep. Joel Robideaux, R-Lafayette, who will sponsor the measures in the House.
Jindal said the rebates and tax breaks would be restricted to companies that can prove they will bring new jobs to Louisiana. He said the state will get much more in tax revenue created than it will lose in incentive dollars.
"We've built in protections in these bills. For example, we require a positive return on investment before some of these enhanced incentives can be offered. We also allow parishes to choose to opt in or opt out of the property tax incentive. The bottom line is this is a smart use of incentives," the governor said.
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