HLS 201ES-114 ORIGINAL
2020 First Extraordinary Session
HOUSE BILL NO. 41
BY REPRESENTATIVE IVEY
TAX/AD VALOREM TAX: (Constitutional Amendment) Establishes an ad valorem tax
exemption for capital investment projects and for certain property subject to a
cooperative endeavor agreement requiring the property owner to make payments in
lieu of taxes (Item #28)
1 A JOINT RESOLUTION
2Proposing to amend Article VII, Section 21(F) of the Constitution of Louisiana and to add
3 Article VII, Section 21(O) of the Constitution of Louisiana, relative to ad valorem
4 property tax exemptions; to establish exemptions for certain property; to establish
5 exemptions for certain capital investment projects; to provide for the terms of
6 exemptions; to provide for the amount of the exemptions; to provide authorization
7 for approval of the exemptions; to provide for the administration of the exemptions;
8 to provide for review by the Board of Commerce and Industry; to provide for
9 approval from political subdivisions; to provide for gubernatorial approval; to
10 establish an exemption for certain non-residential property subject to a cooperative
11 endeavor agreement requiring payments in lieu of taxes; to provide for certain
12 requirements and limitations; to provide for certain limitations; to provide for certain
13 requirements; to provide for submission of the proposed amendment to the electors;
14 and to provide for related matters. and to provide for related matters.
15 Section 1. Be it resolved by the Legislature of Louisiana, two-thirds of the members
16elected to each house concurring, that there shall be submitted to the electors of the state of
17Louisiana, for their approval or rejection in the manner provided by law, a proposal to
18amend Article VII, Section 21(F) and to add Article VII, Section 21(O) of the Constitution
19of Louisiana, to read as follows:
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HB NO. 41
1 §21. Other Property Exemptions
2 Section 21. In addition to the homestead exemption provided for in Section
3 20 of this Article, the following property and no other shall be exempt from ad
4 valorem taxation:
5 * * *
6 (F) Notwithstanding any contrary provision of this Section, the State Board
7 of Commerce and Industry or its successor, with the approval of the governor, may
8 enter into contracts for theexemption there are hereby authorized standard, local, and
9 executive exemptions from ad valorem taxes of a new manufacturing establishment
10 or an addition to an existing manufacturing establishment, on such terms and
11 conditions as the board, with the approval of the governor, deems in the best interest
12 of the state. for capital investment projects as follows:
13 (1) The standard exemption shall be for an initial a term of no more than five
14 eight calendar years, and may be renewed for an additional five years shall provide
15 for an ad valorem tax exemption of eighty percent of the property taxes of the capital
16 investment project. The granting of a standard exemption shall be reviewed by the
17 Board of Commerce and Industry, or its successor as provided by law, and shall be
18 subject to local approval as prescribed by law. Enactment of any law to administer
19 this exemption shall require a favorable vote of two-thirds of the elected members
20 of each house of the legislature.
21 (2) The local exemption shall be for a term of no more than fifteen years and
22 may provide for an ad valorem tax exemption of up to one hundred percent of the
23 property taxes of the capital investment project. The granting of a local exemption
24 shall be subject to local approval as prescribed by law. Enactment of any law to
25 administer this exemption shall require a favorable vote of two-thirds of the elected
26 members of each house of the legislature.
27 (3) The executive exemption shall be for a term determined by the governor
28 and may provide for an ad valorem tax exemption of up to one hundred percent of
29 the property taxes of the capital investment project. The granting of an executive
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HB NO. 41
1 exemption shall require approval from the governor and shall be subject to local
2 approval as prescribed by law. Enactment of any law to administer this exemption
3 shall require a favorable vote of two-thirds of the elected members of each house of
4 the legislature. All property exempted shall be listed on the assessment rolls and
5 submitted to the Louisiana Tax Commission or its successor, but no taxes shall be
6 collected thereon during the period of exemption.
7 The terms "manufacturing establishment" and "addition" as used herein mean
8 a new plant or establishment or an addition or additions to any existing plant or
9 establishment which engages in the business of working raw materials into wares
10 suitable for use or which gives new shapes, qualities or combinations to matter which
11 already has gone through some artificial process.
12 * * *
13 (O)(1) Non-residential property subject to a cooperative endeavor agreement
14 entered into between the property owner and one or more taxing authorities, which
15 agreement requires the property owner to make payments in lieu of taxes.
16 (2) The exemption authorized pursuant to this Paragraph shall be to the
17 extent agreed to and provided for in the cooperative endeavor agreement. All
18 property made part of the cooperative endeavor agreement shall be listed on the
19 assessment rolls and submitted to the Louisiana Tax Commission.
20 (3) The legislature shall provide by law for the implementation of this
21 Paragraph, including the non-residential property eligible for the exemption.
22 Enactment of any law to implement this Paragraph and any amendment to that law
23 shall require a two-thirds vote of the elected members of each house of the
24 legislature.
25 Section 2. Be it further resolved that this proposed amendment shall be submitted
26to the electors of the state of Louisiana at the statewide election to be held on November 3,
272020.
28 Section 3. Be it further resolved that on the official ballot to be used at the election,
29there shall be printed a proposition, upon which the electors of the state shall be permitted
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HB NO. 41
1to vote YES or NO, to amend the Constitution of Louisiana, which proposition shall read as
2follows:
3 Do you support an amendment to authorize property tax exemptions for
4 capital investment projects, to provide for the approval, terms, and amounts
5 of the exemptions, and to authorize the legislature to provide for the
6 administration of the exemptions by law and to grant a property tax
7 exemption for non-residential property subject to a cooperative endeavor
8 agreement with local taxing authorities allowing the property owner to make
9 payments in place of property taxes and to require a two-thirds vote of the
10 legislature to enact laws related to the exemption? (Amends Article VII,
11 Section 21(F); Adds Article VII, Section 21(O))
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)]
HB 41 Original 2020 First Extraordinary Session Ivey
Abstract: Establishes an ad valorem tax exemption for certain capital investment projects
and non-residential property subject to a cooperative endeavor agreement that
requires the property owner to make payments in lieu of ad valorem taxes.
Present constitution authorizes a property tax exemption for new manufacturing
establishments and additions to existing establishments for an initial term of five years, with
a five-year renewal. The exemption is effectuated through a contract granted by the Board
of Commerce and Industry, with the approval of the governor.
Proposed constitutional amendment authorizes three ad valorem property tax exemptions for
capital investment projects as follows:
(1)A standard exemption for a term of eight calendar years for 80% of its property
taxes. The exemption is subject to review by the Board of Commerce and Industry.
This exemption is subject to local approval as provided by law.
(2)A local exemption for a term of no more than 15 calendar years for up to 100% of
its property taxes. This exemption requires the approval of local taxing authorities
as provided by law.
(3)An executive exemption for a term determined by the governor for up to 100% of its
property taxes. This exemption requires approval of the governor and is subject to
local approval as provided by law.
Proposed constitutional amendment also requires that any law enacted to administer any of
the new exemptions requires a favorable vote of two-thirds of the elected members of each
house of the legislature.
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HB NO. 41
Present constitution authorizes the imposition of ad valorem property taxes by local
governments, school boards, and other special districts.
Present constitution establishes a list of exclusive ad valorem tax exemptions.
Proposed constitutional amendment changes present constitution by creating an exemption
for non-residential property subject to a cooperative endeavor agreement requiring the
property owner to make payments in lieu of the ad valorem taxes imposed by a taxing
authority party to the agreement.
Proposed constitutional amendment requires the legislature to provide for the
implementation of proposed constitutional amendment, including the non-residential
property eligible for the exemption.
Proposed constitutional amendment requires that any law enacted to implement this payment
in lieu of taxes program will require a two-thirds vote of both houses of the legislature.
Provides for submission of the proposed amendment to the voters at the statewide election
to be held Nov. 3, 2020.
(Amends Const. Art. VII, §21(F); Adds Const. VII, §21(O))
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