Monday, September 20, 2010

A Ray of Light from the Legislature?

Each year I breathe a sigh of relief with the closing of the Louisiana legislative session.  It is a rare day when I have kind words for the Legislature - it seems our elected officials are more interested in promulgating obnoxious legislation that keeps us locked in a never-ending battle with Mississippi for 50th place on one list or another - but I recently saw a ray of light.

In reading about the new Nucor iron plant in St. James Parish, I was interested to see reference to recently enacted HB 1006, which provides rebates of state severance taxes on Louisiana-sourced natural gas used in "Mega Projects," large economic development projects like the Nucor plant.  (It looks like the Nucor plant isn't eligible for the incentive on the first phase but it might be for later phases.)

This looks like a good program.  I view economic development incentives as a mixed bag.  You can argue the wisdom of paying for jobs, but I am pleased to see a program that pushes Louisiana natural gas as a way to attract industry.  We certainly have gas in abundance, and the state is not dispensing it for free by rebating the severance tax.  It's a win-win:  it might not look like a ton of money to a prospective company looking to locate a plant, but it is a tangible economic benefit and it does attract natural gas users.  I'll be interested to see if it is utilized successfully.

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