Louisiana Economic Development Secretary Stephen Moret says a major project proposed for Lafayette is one of 15 in jeopardy across the state if the Legislature cuts the megafund.
Last week the House Appropriations Committee amended House Bill 1, the $25 billion state spending plan for the fiscal year that starts July 1, to eliminate $81.8 million in existing funding for Louisiana’s Mega-Project Development Fund. With site location decisions anticipated in the next two to four months on all 15 of these major projects, the change threatens every high potential mega-project LED is actively pursuing.
The Mega-Project Development Fund is for projects that generate at least 500 direct new jobs and/or $500 million in capital investment.
Moret says those 15 projects — Louisiana has already been selected a finalist in all of them — could potentially mean more than 27,000 jobs for the state.
“We are in the finals for a major headquarters project in Lafayette right now for which a final company decision is anticipated in the next few weeks,” Moret told The Independent Friday morning. “We will lose that project and more than 500 jobs if the mega fund is not restored.”
Moret noted that the proposal would eliminate money that was appropriated into the Mega-Project Development Fund a year ago. "Specifically, they are proposing to eliminate funds that already have been pledged for major business expansion and recruitment projects," he says. "This is an important distinction because LED’s proposals for large business expansions and recruitment projects typically are explicitly tied to the available dollars in the Mega-Project Development Fund."
Moret says policy reforms implemented by Gov. Bobby Jindal and the Louisiana Legislature over the last few years have resulted in the state now having the strongest pipeline of mega projects in its history. “Collectively, these projects could produce more than 9,000 direct jobs and 16,500 indirect jobs, for a total potential job impact of roughly 25,500 new jobs in Louisiana. The companies involved are considering sites in virtually every region of Louisiana, including Lafayette, Shreveport/Bossier, Monroe, Alexandria, Southwest Louisiana, Baton Rouge and the New Orleans area,” he says.
Although the state will not land all of these projects, LED estimates that it’s very likely Louisiana could win as many as half of them. “My best forecast today is that we would secure roughly five to seven of those projects that would generate about 10,000-15,000 new jobs (including direct and indirect jobs), assuming the mega fund dollars are restored," Moret says.
"Seven of these projects would represent huge expansions of existing Louisiana manufacturing facilities or corporate headquarters, and the remainder would represent huge new corporate investments in Louisiana,” he adds.
The heads of Louisiana’s eight regional economic development organizations have joined Moret in fighting the cuts. In a May 23 letter to the Legislature, those economic development chiefs wrote:
Raiding the Mega-Fund is a declaration of war on job creation in Louisiana. Should this action stand, voters will see it as the most harmful anti-jobs action of the Legislature in this century. Today, the top concern shared by all Louisiana voters is jobs. Louisiana has suffered from slower job growth than the rest of the South over the last decade. Louisiana simply cannot afford to take an anti-jobs stance.
Left in its current posture, this budget action poisons Louisiana’s new reputation as a great place to do business. As LED has stated, these dollars have been pledged in good faith as part of recruitment incentives to locate in our state. Flip-flopping on the state’s pre-existing commitment to the Mega-Fund sends a damaging message to site-selection professionals that Louisiana cannot be trusted in project negotiations.
They also note that the LED budget was further cut by an additional $3 million and that LED has already taken a deep share of agency cuts in the past few years.
Moret maintains that additional HB1 amendments to LED’s budget would result in a significant reduction in funding for small business development centers, business retention programs, regional economic development organizations, international trade promotion, and workforce training, as well as the marketing of Louisiana for new business investment.
Even if the decision is reversed, Moret maintains damage has been done. "Louisiana’s competitive position already has been weakened for all of our current prospects because the committee vote [and subsequent House approval of the budget] calls into question the Legislature’s commitment to the existing funding for the Mega-Project Development Fund," Moret says. "Additionally, the proposed cut would eliminate any possibility of securing the future of the GM-Shreveport facility as an automotive assembly facility.”
HB1, the $25 billion state operating budget, was passed by the House late Thursday night, and the budget bill now goes to Senate Finance Committee. Moret is expected to testify Monday (the committee is planning to hear testimony on Memorial Day).
Read The News Star’s compelling case for why the cuts would hurt the state and kill the Next Autoworks project (formerly V-Vehicle) in Monroe here.
MAY 17 Here's a column from James Gill, this time in the Advocate. Gill, who has jumped ship from the Picayune, writes about the absurdity of dueling polls in this post. The numbers are so wildly different, it is obvious that both sides are "cooking the books," he writes. In particular, he looks at Sen. Mary Landrieu, and how her recent actions in DC have been received by those polled. Gill's acerbic, amusing prose is a welcome addition to a paper so conservative as to be occasionally lacking in personality.
MAY 17 Blogger Tom Aswell continues delivering bombshells about the state education department and Gov. Jindal's education "reform" efforts. In this post, he reports that students in the Shreveport area have been signed up for a charter school without their knowledge or consent. Most interesting to Aswell is how this Texas-based charter (with ties to GOP types) got the personal student information it has, if the students didn't give it.
MAY 17 This post by JR Ball in the Baton Rouge Business Report is an interesting tongue-in-cheek look at recent Baton Rouge economic development efforts. Among the items he examines is the idea that gaining a Costco makes BR a "world-class city." (Really? All you need is a different brand of Sam's? MK!) This effort, and other recent ones, are all built on the taxpayer's back, with tax zones, tax incentives and tax rebates, Ball writes.
MAY 17 Blogger CB Forgotston is critical of the legislature's reliance on a revenue-estimating committee's decision to include projected tax amnesty income in this year's forecast. That's a problem, CB posts, because the deadline for these people to pay their taxes is June 30, 2014. So when do you think these people who haven't paid taxes in years are going to pay their taxes? Surely not before June 30, and that means the money won't be there for this year's budget, he argues.
MAY 17 Here's an interesting blog out of California by a Hollywood writer, attorney and academic named Brian Alan Lane. He blogs about higher ed, and was a whistle-blower in a scandal over false credentials. In this post, he takes aim at LSU's new top dog, King Alexander. It's convoluted and a little confusing, but it sure makes Alexander a lot more interesting than he was yesterday.
MAY 17 Blogger Robert Mann writes about the LSU Board's refusal to allow Dr. Fred Cerise to testify before the legislature about Gov. Jindal's plan to close down all the state's charity hospitals and dump the poor on the private system. It's hard to imagine anyone more qualified than Cerise to testify about that, so why would anyone try to prevent him doing so? Mann thinks it is because the powers that be aren't interested in hearing any truth about the plan.
MAY 17 This post on the Louisiana Sinkhole Bugle, a blog that notes developments in the Bayou Corne and Jefferson Island salt domes, talks about a proposed expansion of the salt dome storage under Lake Peigneur in Iberia Parish. Residents are working against it for several reasons, including two biggies: the sinkhole disaster in Bayou Corne and the continuing, unexplained bubbling on the surface of the Lake.
MAY 17 NOLA police arrested more people Thursday accused of either being involved in the Mother's Day shooting or hiding the suspect afterward, this Gambit story reports. The NOLA police chief said he suspects the whole thing was gang-related and throws out a challenge to the gangs: he's got informants now, he says, and he knows a lot more than the gangs want him to know. The people who live in the neighborhoods terrorized by gangs are ready to talk, he says.
Most Read
in case you missed it
Subscribe to this comment's feed
-------------------
The only way government "creates" jobs is to take money from one person and give it to another. It looks good but the guy whose pocket is picked is now poorer. Some much for progress.