Louisiana offers new and existing businesses significant advantages with highly competitive incentives and innovative solutions. The state’s suite of incentives is available to a variety of industries and can be tailored to fit specific project needs.
For example, Louisiana’s Industrial Tax Exemption Program provides a 100 percent property tax abatement for an initial five-year term, with an option for a five-year renewal, on manufacturer’s qualifying capital investments.
Vancouver, British Columbia-based Methanex Corp. is utilizing the program in relocating two methanol plants from Chile to Geismar. The new Louisiana facilities will create 165 direct jobs and represent a total of $1.1 billion in capital investment in the state.
In software, the state’s Digital Interactive Media and Software Development Incentive offers a refundable tax credit of 35 percent on payroll for in-state labor and 25 percent for qualified production expenses, with no cap and no minimum requirement. Qualifying products include digital media and games, Web-based and mobile applications, consumer software, entertainment software, business and enterprise software, interactive devices and consoles, and embedded systems. Companies such as CGI, Gameloft, EA, qalytics and High Voltage Software are utilizing the incentive to reduce costs and stay competitive.
The Competitive Projects Payroll Incentive Program provides an incentive rebate of up to 15 percent of a participating company’s new payroll for up to 10 years. Additionally, a participating company will be eligible for either a rebate of state sales and use taxes on capital expenditures or a 1.5 percent rebate on a project’s facility expense. This incentive program, offered by invitation from the Secretary of Economic Development, may be applied to aircraft manufacturing, automobile manufacturing, conversion of natural gas to diesel and industrial machinery manufacturing, among others.
Other discretionary incentives, such as the Economic Development Award Program (EDAP), are available for targeted project needs. Performance-based EDAP grants help fund improvements or expansions of publicly owned infrastructure tied to new economic development projects.
Louisiana’s incentives aren’t the only support the state offers. From identifying an ideal site, to assisting with permitting, to tailoring workforce development resources and aligning state, city and parish resources, Louisiana creatively customizes solutions for new and expanding businesses.
In 2011, Benteler Group, a 135-year-old Austria-based company, made the strategic decision to expand its steel/tube division to North America with its first hot-rolling tube mill in the U.S. Louisiana worked with the company to develop a customized package that included performance based grants for site development, infrastructure and equipment costs. The state also partnered with Benteler to develop a Center for Advanced Manufacturing and Engineering located at Bossier Parish Community College that would support the training efforts for workers on Benteler’s projects.
“By removing obstacles, reducing bureaucracy, providing meaningful support and eliminating roadblocks, Louisiana officials at all levels convinced us that this state is the ideal location for our production facility,” says Matthias Jaeger, CEO of Benteler Steel/Tube. “Those officials were willing to work closely with us to create an environment and a set of initiatives that made our decision an easy one.”
Sasol also found Louisiana to be cooperative, responsive and flexible when the company sought a location for its integrated GTL and ethane cracker complex. The GTL facility would be the first of its kind in the U.S. and to be successful, Sasol required critical resources such as a strong energy infrastructure, access to interstates and highways, port facilities, and a skilled and highly capable workforce. Louisiana officials collaborated with Sasol representatives to develop solutions to support Sasol’s GTL and ethane cracker complex. The combined projects have an estimated capital investment of $19 billion to $22 billion — the largest foreign direct investment manufacturing project in U.S. history.
“In our experience Louisiana is a state that understands the challenges of modern business, particularly those challenges encountered by the energy and chemical sectors. As a result of this understanding LED has created an environment which it attracts new business and provides the private sector with the opportunity to expand and flourish,” said David Constable, CEO of Sasol Ltd.
With this kind of determined collaboration with companies, it is no wonder that Louisiana Economic Development was ranked in the top 10 economic development organizations in the nation.