Louisiana: Board of Commerce and Industry to allow state-level appeal of local ITEP applications

The Louisiana Board of Commerce and Industry (Board) recently passed a resolution to amend the rules around appealing Industrial Tax Exemption Program (ITEP) exemptions. The ITEP grants a property tax abatement of 80 percent to certain manufacturers for up to five years with an opportunity for a five-year renewal. The benefits can be increased to a 93 percent abatement for certain “mega projects” estimated to generate $20 million in net new payroll and $100 million in capital expenditures within in a specified time period. As background, in 2016, Governor Jon Bel Edwards issued an executive order that granted local parishes, city councils, school boards, and sheriffs the power to approve or deny ITEP projects within their jurisdictions, effectively giving the local governments a voice with respect to which economic development projects occurred in their jurisdiction. The Board’s resolution allows taxpayers that have an ITEP application denied by a local governing body to appeal the denial directly to the Board. The resolution stipulates that appeals will be heard only if the taxpayer believes the denial was based on local guidelines that contradict the ITEP rules. The Governor issued a statement on the resolution in which he noted that it was only “to clarify a portion of the rules related to the Industrial Tax Exemption Program” and that “in the vast majority of cases, I anticipate that the State will not entertain an appeal under this clarified rule at all.” Please contact Randy Serpas at 504-569-8810 with questions.