The original instrument and the following digest, which constitutes no part of the
legislative instrument, were prepared by Leonore Heavey.
DIGEST
SB 158 Original 2021 Regular Session Allain
Present constitution provides that all property is subject to ad valorem taxation unless specifically
exempted.
Present constitution authorizes the State Board of Commerce and Industry, with gubernatorial
approval, to enter into contracts to exempt new and expanding manufacturing facilities from ad
valorem taxation.
Proposed constitutional amendment retains the ability of the board to enter into contracts to exempt
certain manufacturing facilities from certain ad valorem taxes.
Proposed constitutional amendment, beginning January 1, 2023, prohibits the board from providing
an exemption for a manufacturing facility for more than 80% of the assessed value of the property.
Proposed constitutional amendment provides that the terms "new manufacturing establishment" and
"addition to an existing manufacturing establishment" do not include maintenance, required
environmental upgrades, miscellaneous capital improvements, or replacements of existing machinery
or equipment.
Proposed constitutional amendment provides that the tax commission establish criteria for
determining the value of property after ten years of use and that these criteria shall be uniform
throughout the state.
Proposed constitutional amendment phases out an ad valorem tax for goods held in inventory over
a four-year period in equal percentages, beginning in ad valorem tax year 2023, completely
exempting inventory from ad valorem taxation after ad valorem tax year 2025.
Proposed constitutional amendment defines "inventory" as goods that are held for sale in the ordinary
course of business, goods in production or for ultimate consumption in the production of goods for
sale in the ordinary course of business, and goods utilized in the ordinary course of business for
marketing and distribution activities.
Proposed constitutional amendment creates a supplemental revenue sharing fund that will be used
to offset revenue losses attributable to the phase-out of the tax on inventory.
Proposed constitutional amendment supplemental revenue sharing fund will be $50 million in FY
2024, and increases $50 million per fiscal year until FY 2027 and will be $200 million per year
beginning FY 2027. Proposed constitutional amendment supplemental revenue sharing fund will be distributed each year
to parishes by population and will be forwarded to the parish tax collectors to be distributed to tax
recipient bodies within the parish in proportion to their ad valorem tax collections.
Proposed constitutional amendment authorizes political subdivisions to incur debt by issuing
negotiable bonds and may pledge for the payment of all or part of the principal and interest of the
bonds the proceeds derived or to be derived from that portion of the funds received by it from the
supplemental revenue sharing fund, to offset current losses caused by exemptions for inventory
granted in this proposed constitutional amendment.
Proposed constitutional amendment provides that the monies distributed to each local taxing
authority from the supplemental revenue sharing fund shall be considered as ad valorem tax revenue
for purposes of the constitutionally required rollback after the next reassessment.
Specifies submission of the amendment to the voters at the statewide election to be held on
November 8, 2022.
(Amends Const. Art. VII, Sec. 21(F); adds Const. Art. VII, Sec. 21(O) and 26.1(F))