HLS 13RS-937 ORIGINAL
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Regular Session, 2013
HOUSE BILL NO. 551
BY REPRESENTATIVE LEGER
TAX CREDITS: Makes changes to both the Investor Tax Credit and the Import Export
Cargo Credit of the Ports of Louisiana Tax Credit Program and provides a new
termination date for the credit
AN ACT1
To amend and reenact R.S. 47:6036(B)(8) and (13), (C)(1)(b) and (c), (G), (I)(1), (I)(1)(c),2
and (2)(a), relative to tax credits; to provide relative to the Ports of Louisiana tax3
credit; to provide for the term of the credit; to provide for the activities and projects4
to which the credit applies; to provide relative to certain determinations and5
certifications; to provide for an effective date; and to provide for related matters.6
Be it enacted by the Legislature of Louisiana:7
Section 1. R.S. 47:6036(B)(8) and (13), (C)(1)(b) and (c), (G), (I)(1), (I)(1)(c), and8
(2)(a) are hereby amended and reenacted to read as follows: 9
ยง6036. Ports of Louisiana tax credits10
* * *11
B. Definitions.12
For purposes of this Section, the following words shall have the following13
meanings unless the context clearly indicates otherwise:14
* * *15
(8) "Port or port and harbor activity" shall mean and include any activity16
when the trade or business is conducted on premises in which a duly recognized port17
authority has an ownership, leasehold, or other possessory interest and such premises18
are used as part of the operations of a duly recognized port authority including, but19
not limited to any trade or business described in the 1997 North American Industry20 HLS 13RS-937 ORIGINAL
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Classification System (NAICS) within Subsector 493 (Warehousing and Storage),1
Industry Number 488310 (Port and Harbor Operations), or Industry Number 4883202
(Marine Cargo Handling), when the trade or business is conducted on premises in3
which a duly recognized port authority has an ownership, leasehold, or other4
possessory interest and such premises are used as part of the operations of a duly5
recognized port authority, Industry Number 336611 (Ship Building and Repair),6
Industry Number 213112 (Support Activities for Oil and Gas Operations), including7
the above trades and businesses as they may hereafter be reclassified in any8
subsequent publication of the NAICS or similar classification system developed in9
conjunction with the United States Department of Commerce and Office of10
Management and Budget.11
* * *12
(13) "Qualifying project" shall mean and include a project to be sponsored13
or undertaken by a public port and one or more investing companies that have has14
a capital cost of not less than five one and one-half million dollars and at which the15
predominant trade or business activity conducted will constitute industrial,16
warehousing, or port and harbor operations and cargo handling, including any port17
or port and harbor activity.18
* * *19
C. Investor tax credit.20
(1)21
* * *22
(b) The Investor Tax Credit provided for in this Subsection shall be issued23
by the Department of Economic Development for a qualifying project if the24
commissioner of administration, after approval of the Joint Legislative Committee25
on the Budget, and the state bond commission certifies to the secretary of the26
department that there will be sufficient revenue received by the state to offset the27
effect to the state of the tax credits provided for the capital costs of the project,28
whether from increased port or port and harbor activity because of the grant of the29 HLS 13RS-937 ORIGINAL
HB NO. 551
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tax credit or otherwise securing the project will result in a significant positive1
economic benefit to the state. "Significant positive economic benefit" means net2
positive tax revenue that shall be determined by taking into account direct, indirect,3
and induced impacts of the project based on a standard economic impact4
methodology utilized by the commissioner, the value of the credit, and any other5
state tax and financial incentives that are used by the department to secure the6
project. If the commissioner with the approval of the committee so certifies, then the7
Department of Economic Development may shall grant a tax credit equal to either8
the total capital costs of a the qualifying project to be taken at five percent per tax9
year; however, or for a different amount to be taken at a different percentage which10
is warranted by the significant positive economic benefit determined by the11
commissioner; however, the total amount of tax credits granted on a qualifying12
project shall not exceed the total cost of the project.13
(c) The tax credit shall be earned by investors at the time expenditures are14
made by an investing company; however, tax credits shall not be applied against a15
tax liability until the project is approved by the department after certification from16
the commissioner with the approval of the committee and the state bond commission17
and capital cost expenditures are certified by the department. The Department of18
Economic Development shall certify capital cost expenditures no less than twice19
during the duration of the qualifying project unless the investing company agrees,20
in writing, to reimburse the Department of Economic Development for the costs of21
any additional certifications.22
* * *23
G. Termination of Investor and Import Export Cargo Tax Credit.24
The provisions of Subsection C Subsections C and I of this Section shall be25
effective until January 1, 2017 January 1, 2020, and no investor tax credit or import26
export cargo credit pursuant to the provisions of this Section shall be granted after27
such date.28
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I. Import Export Cargo Credit.1
(1) Certification of taxpayer. Only those taxpayers who have received2
certification from the secretary of the Department of Economic Development shall3
be eligible to take the tax credits provided for by this Subsection and then only for4
the taxable year or years and for the amount provided for in the commissioner of5
administration's certification, approved by the Joint Legislative Committee on the6
Budget and the state bond commission, provided for in Item (2)(a)(ii) of this7
Subsection as allocated by the secretary. The secretary shall promulgate rules in8
accordance with the Administrative Procedure Act which establish the process by9
which a taxpayer shall apply for certification.10
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(c) The secretary shall provide a statement of certification to each taxpayer12
which he has certified as eligible to take the tax credit after approval of the Joint13
Legislative Committee on the Budget and the state bond commission, which shall14
contain the taxable year or years for which the taxpayer is allowed the tax credit and15
the amount of tax credit allocated for such taxable year or years. The secretary shall16
also transmit a copy of such statement to the secretary of the Department of17
Revenue.18
(2)(a)(i) For taxable years beginning on and after January 1, 2009, there19
There shall be allowed a credit against the individual income, corporation income,20
and corporation franchise tax liability of a taxpayer who has received certification21
pursuant to the provisions of Paragraph (1) of this Subsection. The amount of the22
credit shall be equal to the product of multiplying five dollars by the taxpayer's23
number of tons of qualified cargo for the taxable year but only for the total amount24
of the allocation provided to the taxpayer by the secretary of the Department of25
Economic Development for such taxable year or the product of multiplying the26
number of dollars by the taxpayer's number of tons of qualified cargo for the taxable27
year which is warranted by the significant positive economic benefit determined by28
the commissioner pursuant to Item (ii) of this Subparagraph.29 HLS 13RS-937 ORIGINAL
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(ii) The tax credit provided for in this Subsection shall only be allowed for1
all or a portion of a fiscal year if the commissioner of administration certifies to the2
secretary of the Department of Economic Development that there will be sufficient3
revenue received by the state to offset the effect to the state of the tax credits4
provided for in this Subsection whether from the increased utilization of public port5
facilities and other activity in Louisiana associated with the import or export of the6
international business entities' qualified cargo will result in a significant positive7
economic benefit to the state. "Significant positive economic benefit" means net8
positive tax revenue that shall be determined by taking into account direct, indirect,9
and induced impacts of the port and state activity based on a standard economic10
impact methodology utilized by the commissioner, and the value of the credit, and11
any other state tax and financial incentives that are used by the department to secure12
the port and state activity because of the tax credit or otherwise, and such13
certification is approved by the Joint Legislative Committee on the Budget and the14
state bond commission.15
* * *16
Section 2. This Act shall become effective on August 1, 2013.17
DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
Leger HB No. 551
Abstract: Extends the termination date of the Investor Tax Credit and the Import Export
Credit from Jan. 1, 2017 to Jan. 1, 2020, and deletes the requirement that the bond
commission approve the certification of qualifying projects.
Present law authorizes the Department of Economic Development (DED) to grant a credit
against corporate income and franchise tax liability equal to the total capital costs of a
"qualifying project", to be taken at 5% per tax year, limited to the total cost of the project.
Present law defines a "qualifying project" as a project sponsored or undertaken by a public
port and one or more investing companies that has a capital cost of not less than $5 million
and at which the predominant trade or business activity conducted will constitute industrial,
warehousing, or port and harbor operations and cargo handling, including any "port or port
and harbor activity". HLS 13RS-937 ORIGINAL
HB NO. 551
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are additions.
"Port or port and harbor activity" is defined as any trade or business described in the 1997
North American Industry Classification System (NAICS) within Subsector 493
(Warehousing and Storage), Industry Number 488310 (Port and Harbor Operations), or
Industry Number 488320 (Marine Cargo Handling).
Proposed law reduces the capital cost of a "qualifying project" from $5 million to one and
one-half million dollars and expands the definition of "port or port and harbor activity" to
include Industry Number 336611 (Ship Building and Repair) and Industry Number 213112
(Support Activities for Oil and Gas Operations).
Present law requires DED to issue the Investor Tax Credit for a "qualifying project" if the
commissioner of administration, after approval of the Joint Legislative Committee on the
Budget and the state bond commission certifies to the secretary of DED that the state will
receive sufficient revenue to offset the effect of the tax credits provided.
Proposed law removes the need for certification approval from the state bond commission
and requires DED to issue the Investor Tax Credit if the commissioner of administration
certifies, after approval of the Joint Legislative Committee on the Budget, that securing the
project will result in a "significant positive economic benefit to the state". "Significant
positive economic benefit" is defined as net positive tax revenue that must be determined by
taking into account direct, indirect, and induced impacts of the project based on a standard
economic impact methodology utilized by the commissioner, the value of the credit, and any
other state tax and financial incentives used by DED to secure the project.
Proposed law authorizes DED the option to grant, in lieu of a credit equal to the total capital
costs of the project taken at 5% per tax year, a different amount of tax credit to be taken at
a different percentage which is warranted by the "significant positive economic benefit"
determined by the commissioner; however, the total amount of credits cannot exceed the
total cost of the project.
Present law authorizes the secretary of DED to certify "international business entities" for
an Import Export Cargo Credit against the individual and corporate income and corporate
franchise tax equal to the product of multiplying $5 by the "international business entity's"
number of tons of "qualified cargo" for the taxable year, but only for all or a portion of a
fiscal year if the commissioner of administration certifies to the secretary of DED that
sufficient revenue will be received by the state to offset the effect of the tax credits, and the
certification is approved by the Joint Legislative Committee on the Budget and the state
bond commission.
"International business entity" is defined as a taxpayer entity, all or a portion of whose
activities involve the import or export of breakbulk or containerized cargo to or from
manufacturing, fabrication, assembly, distribution, processing, or warehousing facilities
located within Louisiana.
Proposed law removes the need for certification approval from the state bond commission
and authorizes the secretary of DED to certify the credit for an international business entity
if the commissioner of administration certifies to the secretary that the increased utilization
of public port facilities and other activity in Louisiana associated with the import or export
of the international business entity's qualified cargo will result in a "significant positive
economic benefit to the state".
Proposed law authorizes DED the option to grant, in lieu of a credit equal to the product of
multiplying $5 by the number of tons of cargo for the taxable year or a portion of a fiscal
year, the product of multiplying the number of dollars by the taxpayer's number of tons of
qualified cargo for the taxable year or portion of a taxable year which is warranted by the
"significant positive economic benefit" determined by the commissioner. HLS 13RS-937 ORIGINAL
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Proposed law extends the termination date of the Investor Tax Credit from January 1, 2017
to January 1, 2020, and terminates the Import Export Credit on that same date.
Effective August 1, 2013.
(Amends R.S. 47:6036(B)(8) and (13), (C)(1)(b) and (c), (G), (I)(1)(intro para), (I)(1)(c), and
(2)(a))