(Constitutional Amendment) Authorizes certain agreements that provide for payments in lieu of ad valorem taxes (Item #28) (EG SEE FISC NOTE LF RV See Note)
If enacted, HB 23 would amend the Louisiana Constitution to allow local governments greater flexibility in establishing agreements that could lead to beneficial tax arrangements. By enabling these payments in lieu of taxes (PILOTs), local governments could attract new business investments that strengthen their economic base. This provision may support a variety of economic development strategies, potentially leading to job creation and increased local revenues in the long-term. However, the implications for existing tax frameworks and local government revenue structures remain a critical consideration.
House Bill 23 is a proposed constitutional amendment aimed at authorizing political subdivisions in Louisiana to enter into agreements for payments in lieu of ad valorem taxes. This would allow certain properties, specifically new establishments or additions to existing ones, to be subject to partial or full exemptions from ad valorem taxes. The bill is intended to enhance local economies by incentivizing strategic investments that could lead to economic growth within parishes and municipalities. This amendment would be submitted for voter approval during the statewide election scheduled for November 3, 2020.
Sentiment towards HB 23 appears to be cautiously optimistic, particularly among local officials and economic development advocates who see the potential for enhanced investment opportunities. Supporters argue that this flexibility could help revitalize areas in dire need of economic support. However, there are concerns from some community members and critics about the broader implications of property tax exemptions. They worry that while the incentive structure may attract businesses, it could also lead to reduced funding for essential local services reliant on property tax revenues.
Notable points of contention include the balance between incentivizing new economic development through tax exemptions while ensuring that communities do not suffer from diminished tax revenues essential for public services. There is also concern about the broader implications of such amendments on existing tax frameworks and whether they may encourage a race to the bottom in terms of tax incentives among localities. The debate ultimately hinges on the necessity of supporting local economic development against the backdrop of maintaining robust funding for local services.