News Intro Text
Industrial Tax Exemption Program
Date
News Item Content
<p>Findings show:</p>
<p> </p>
<p>A state board is giving away $16.7 billion in local property taxes, without approval from local governments losing the funding Public subsidies total $535,343 per job created BP received $9.4 million in public subsidies from Louisiana taxpayers during and after Deepwater Horizon spill Louisiana’s top 5 polluters are each receiving public taxpayer subsidies, totaling $505 million Governor John Bel Edwards has the constitutional authority to overhaul the program single-handedly, in whatever way he deems is in the best interest of the state.</p>
<p>June 20th, 2016 – Together Louisiana is releasing the most in-depth study of Louisiana’s Industrial Tax Exemption program to date, and the findings are making waves in the State Capitol and across the state.</p>
<p>The analysis is significant not only in its scathing assessment of the program for its cost and poor results for economic development, but also in the case Together Louisiana makes that reforming the program is relatively simple and achievable in the short-term.</p>
<p>Under the Industrial Tax Exemption Program, or ITEP, the Louisiana State Board of Commerce and Industry offers exemptions from property taxes to manufacturers who replace their equipment or expand their operations. The exemptions are from local property tax revenue – funding that would go to local school districts, parishes, cities and other local entities. However, a state board, the Board of Commerce and Industry, makes the decisions on the subsidies, without the approval of the local entities who are losing the funding. </p>
<p>The program currently redirects a total of $16.7 billion in property taxes over 10 years from local governmental entities to corporations – an average of $1.67 billion per year -- making it, according to the study, the single largest program of state subsidies to corporations in the nation.</p>
<p>The study, which includes an analysis of the cost to every parish and a breakdown of foregone revenue for each public service with a dedicated millage, is available at www.togetherla.com.</p>
<p>The study also shows how the program can be reformed, which turns out to be easier to accomplish than virtually any other tax measure under discussion at the time. (See "finding #1" below.)</p>
<p>Top 10 Findings of the Together Louisiana analysis of Industrial Tax Exemption Program:</p>
<p>#10) The Industrial Tax Exemption Program is the single largest program of state subsidies to corporations in the nation.</p>
<p>#9) The exemptions are not “incentives” in any meaningful sense, because they are automatic and non-discretionary, with no "return-on-investment" analysis, no requirement for job creation and no assessment of whether the investments would have taken place anyway without the subsidies.</p>
<p>#8) The program is the only example in the nation of a state board giving away the tax revenue of local governmental entities, without the approval of those entities.</p>
<p>#7) The public subsidy PER JOB created by the exemptions is $535,343.</p>
<p>#6) The exemptions currently granted total $16.7 billion over 10 years, an average of $1.67 billion per year.</p>
<p>#5) The amount of industrial exemptions given away each year is 23 times as large as the current TOPS shortfall.</p>
<p>#4) The amount of tax revenue lost to local school districts alone each year ($587 million) is more than three times the amount it would take to implement universal pre-K statewide ($185 million).</p>
<p>#3) All of the five companies with the worst record of toxic chemical releases in Louisiana are receiving industrial tax exemption subsidies, totaling $506 million.</p>
<p>#2) During the Deepwater Horizon oil spill (2010), BP was receiving its first installment on $9.4 million in industrial tax exemption subsidies. Those exemptions were renewed in 2014.</p>
<p>#1) Reforming the Industrial Tax Exemption Program is simple and achievable. The Louisiana constitution grants the Governor the authority to reform the program in whatever way he deems is “in the best interest of the state.”</p>
<p><a href="http://togetherla.com/analysis/">Download the full study.</a></p>
<p> </p>
<p>A state board is giving away $16.7 billion in local property taxes, without approval from local governments losing the funding Public subsidies total $535,343 per job created BP received $9.4 million in public subsidies from Louisiana taxpayers during and after Deepwater Horizon spill Louisiana’s top 5 polluters are each receiving public taxpayer subsidies, totaling $505 million Governor John Bel Edwards has the constitutional authority to overhaul the program single-handedly, in whatever way he deems is in the best interest of the state.</p>
<p>June 20th, 2016 – Together Louisiana is releasing the most in-depth study of Louisiana’s Industrial Tax Exemption program to date, and the findings are making waves in the State Capitol and across the state.</p>
<p>The analysis is significant not only in its scathing assessment of the program for its cost and poor results for economic development, but also in the case Together Louisiana makes that reforming the program is relatively simple and achievable in the short-term.</p>
<p>Under the Industrial Tax Exemption Program, or ITEP, the Louisiana State Board of Commerce and Industry offers exemptions from property taxes to manufacturers who replace their equipment or expand their operations. The exemptions are from local property tax revenue – funding that would go to local school districts, parishes, cities and other local entities. However, a state board, the Board of Commerce and Industry, makes the decisions on the subsidies, without the approval of the local entities who are losing the funding. </p>
<p>The program currently redirects a total of $16.7 billion in property taxes over 10 years from local governmental entities to corporations – an average of $1.67 billion per year -- making it, according to the study, the single largest program of state subsidies to corporations in the nation.</p>
<p>The study, which includes an analysis of the cost to every parish and a breakdown of foregone revenue for each public service with a dedicated millage, is available at www.togetherla.com.</p>
<p>The study also shows how the program can be reformed, which turns out to be easier to accomplish than virtually any other tax measure under discussion at the time. (See "finding #1" below.)</p>
<p>Top 10 Findings of the Together Louisiana analysis of Industrial Tax Exemption Program:</p>
<p>#10) The Industrial Tax Exemption Program is the single largest program of state subsidies to corporations in the nation.</p>
<p>#9) The exemptions are not “incentives” in any meaningful sense, because they are automatic and non-discretionary, with no "return-on-investment" analysis, no requirement for job creation and no assessment of whether the investments would have taken place anyway without the subsidies.</p>
<p>#8) The program is the only example in the nation of a state board giving away the tax revenue of local governmental entities, without the approval of those entities.</p>
<p>#7) The public subsidy PER JOB created by the exemptions is $535,343.</p>
<p>#6) The exemptions currently granted total $16.7 billion over 10 years, an average of $1.67 billion per year.</p>
<p>#5) The amount of industrial exemptions given away each year is 23 times as large as the current TOPS shortfall.</p>
<p>#4) The amount of tax revenue lost to local school districts alone each year ($587 million) is more than three times the amount it would take to implement universal pre-K statewide ($185 million).</p>
<p>#3) All of the five companies with the worst record of toxic chemical releases in Louisiana are receiving industrial tax exemption subsidies, totaling $506 million.</p>
<p>#2) During the Deepwater Horizon oil spill (2010), BP was receiving its first installment on $9.4 million in industrial tax exemption subsidies. Those exemptions were renewed in 2014.</p>
<p>#1) Reforming the Industrial Tax Exemption Program is simple and achievable. The Louisiana constitution grants the Governor the authority to reform the program in whatever way he deems is “in the best interest of the state.”</p>
<p><a href="http://togetherla.com/analysis/">Download the full study.</a></p>