Louisiana's Economic Renaissance Off to Strong Start
30 Jun, 2008By: Trade & Industry Development
Charged with creating a more vibrant Louisiana economy, Louisiana Economic Development (LED) is focusing much of its resources on making the state more attractive for business investment.
A State of Reform
Shortly after taking office in January, Governor Bobby Jindal and the Louisiana Legislature enacted significant ethics and business tax reforms to help make Louisiana more attractive for business investment. In February, Jindal, LED Secretary Stephen Moret and other cabinet officials announced additional workforce and economic development initiatives being included in the Governor’s budget.
Jindal said, “Creating a business climate that encourages our Louisiana businesses to expand and create more jobs is a vital step to transforming our state so that our children and grandchildren don’t have to leave to pursue their dreams. Additionally, we must ensure our Louisiana workforce is highly skilled and trained and our workers are ready to work on their very first day on the job.” These reforms and initiatives include:
Comprehensive ethics reform for all levels of state and local government
Elimination of unorthodox business taxes, such as utilities, manufacturing equipment and corporate franchise taxes
Turnkey workforce solutions for new and expanding businesses
Additional resources for higher education to help fill worker shortages in areas such as health care and construction trades
Expanding career and technical education programs
Creation of a new business expansion/retention team within Louisiana Economic Development
Increased allocations and resources for rapid response to economic development projects.
In addition, LED is the first state economic development agency to offer a complete online process for companies applying for business incentives. LED’s newest technology, “FastLane,” provides online submittal and tracking of applications for two of the state's most popular business incentives.
"This revolutionizes the way we interact with our clients and constituents, as well as the level of service we provide," said Moret. "By enabling businesses to submit incentive applications, pay application fees and track the progress of their applications online, we're making the process much easier, yet secure for everyone. FastLane expedites the user experience and our internal process, leading to a much more efficient, open way of managing our business incentives programs."
The new technology is available for Enterprise Zone and Industrial Tax Exemption applications. With FastLane, users can electronically file advance notifications, save individual information for future use and review historical advance notifications, projects and applications. In the next few months, businesses will also be able to apply for the Restoration Tax Abatement and Quality Jobs incentives through the online system. Over the next year, LED plans to expand the FastLane program to include other state incentive and loan programs.
For more information or to apply for incentives using FastLane, please visit https://fastlane.louisianaforward.com/Login.aspx .
Focus on Retention
LED’s focus on retention and expansion of existing businesses – through its progressive suite of business incentives and investment from the state’s budget surplus – has already begun to pay off with exciting new projects.
Edison Chouest Offshore (ECO) announced in March that it is expanding its Louisiana shipyard operations at the Port of Terrebonne. The $10 million investment requested by Governor Jindal during the state’s second special legislative session will help bring 1,000 new jobs at a $54,000 annual average salary.
"We at Edison Chouest Offshore are proud of our Louisiana heritage and are excited about the creation of 1,000 jobs in Terrebonne Parish," said Gary Chouest, president of Edison Chouest Offshore.
At the Port of Terrebonne, Edison Chouest Offshore, through its sister company LaShip, will build vessels to support growing deepwater offshore oil and gas industry needs for vessels with hull lengths greater than 350 feet. Pending legislative approval, the state will provide $10 million to support infrastructure improvements at the Port of Terrebonne to accommodate the company's expansion investment. The Port of Terrebonne also will receive a $4 million grant from the Governor's Rapid Response Fund to complete the infrastructure improvements.
In May, Baton Rouge Coca-Cola Bottling Company President Darian Chustz, Governor Jindal and other state and local officials announced that the company will expand its new Baton Rouge production and distribution facility by at least 270,000 additional square-feet. This $93 million expansion brings the company's local investment to $178 million. Baton Rouge Coca-Cola Bottling Company expects this expansion to add up to 113 new jobs by 2012 with an average annual wage of $45,000.
Jindal said, "Retaining and growing existing Louisiana businesses like Baton Rouge Coca-Cola works toward our fundamental goal of ensuring our state becomes the best place in the world to raise a family, get a great education and pursue a rewarding career.”
Through a recent collaboration with The Coca-Cola Company, Baton Rouge Coca-Cola will become a regional production and distribution hub for the Coca-Cola system, creating up to 113 new jobs.
To secure the expanded production agreement with The Coca-Cola Company, which essentially serves as a new production and distribution hub added to the local facility already under construction, it was necessary to expand the site infrastructure. LED is providing a $1.4 million grant for two water wells and other site improvements through its Economic Development Award Program (EDAP).
Coca-Cola expects to complete phase one of the new campus by Dec. 31, 2008. In phase two, the three additional operational lines will provide up to 113 new jobs over four years, bringing the total employee base to over 600 people. The final building design will be over 770,000-square-feet.
Recruitment of new investors to Louisiana continues as well, emphasizing strategic resources available to those in legacy industries and new opportunities for companies representing Louisiana’s emerging industries.
Albemarle announced that its board of directors had approved a move of the company’s corporate headquarters to Louisiana from Virginia. This success adds Louisiana’s fifth Fortune 1000 company.
Company executives cited several factors in the decision, including the positive direction of the state and city, prior success with existing administrative and manufacturing activities in the Baton Rouge region, and the state and local incentives package, which will help offset most of the company's relocation expenses. Albemarle leaders particularly cited Louisiana's recent ethics reforms and elimination of the sales tax on natural gas as key deciding factors.
"We are focused on maximizing Albemarle's global position to create long-term value and momentum, and relocating our corporate headquarters to Louisiana is a key element of this strategy," said Albemarle President and CEO Mark C. Rohr. "We have considered combining our executive and administrative offices for some time and evaluated several cities in the Southeast. There were many factors that drove our decision. We were particularly impressed with the level of collaboration between the state administration, the city-parish and the local business community to meet our needs and drive the process. Ultimately, the combination of the new administration's ability to drive progressive initiatives for the state, our confidence in the direction of the city of Baton Rouge and the close proximity to many of our key customers and suppliers, made it clear that Louisiana is the right choice for Albemarle."
Through a combination of relocations and new hires associated with the corporate headquarters move, Albemarle will create at least 30 new jobs in Baton Rouge by year-end and new payroll of at least $7 million per year, which amounts to more than $200,000 per job. (Albemarle expects to close its Richmond office later this year.)
Louisiana's four existing Fortune 1000 firms are CenturyTel, Entergy, Pool Corporation and The Shaw Group.
Superior Homes selected East Feliciana Parish as the location for a new modular building manufacturing facility. The company plans to hire up to 150 people in the next few years at $13/hour plus benefits and generate $3 million in capital investment.
"We are excited about the opportunity we have here in Louisiana," said Flynn Foster, president of Superior Homes. "Employing Louisiana citizens appeals to us the most. As a lifetime resident of this great state, it is a thrill for me to see the level of support Louisiana Economic Development and the Baton Rouge Area Chamber gave to our project. Louisiana still has a massive affordable-housing need and Superior Homes will do its part to help fulfill that need. From the top down, everyone sees the value of this project."
Superior Homes, LLC, the parent company of Superior Homes of Louisiana, LLC, is based in South Dakota and has been producing modular products for the last 50 years. The new 71,000-square-foot facility located in Clinton, LA, will build modular homes, schools, restaurants, dorms, cafeterias and other light commercial buildings. Construction of the new homes and buildings is scheduled to begin October 2008. Louisiana continues to attract the steel industry’s attention. In May, Nucor Corporation announced it had applied for a permit to build a state-of-the-art iron-making facility in St. James Parish, LA. The new company would be called "Nucor Steel Louisiana."
Over the past two years, Nucor has evaluated multiple sites in the United States and abroad. In its analysis, Nucor considered many factors – site features, transportation, permitting, the commitment of the state's leadership to the project and the proposed incentive packages. The competitiveness of Louisiana's proposed incentive package, including significant infrastructure improvements and the state's ability to move quickly, were very important in the analysis. The large site on the Mississippi River is the only U.S. location being considered. Sites outside of the United States are still under active consideration. If the project lands in the United States, it would be the first greenfield pig iron facility built here in more than 30 years.
"We are proud that Nucor, a company with a great reputation for creating jobs in the U.S., is considering Louisiana for this important project," Jindal said. "This would provide a tremendous boost to Louisiana's economic development and further job creation. We will continue to work with local communities here to attract a facility that can become a national model for responsible manufacturing and economic growth."
If the company selects St. James Parish, Nucor would build a new high-capacity port on the river capable of handling ocean vessels, as well as barges of coal and pig iron. The project's first phase would require a $2 billion investment and directly create 2,000 jobs during peak construction. Five hundred permanent Nucor jobs would be created, earning an average annual salary of $75,000, plus benefits – roughly twice the area's median household income.
If the second phase is built, Nucor would invest $1 billion for a second 3-million-ton blast furnace, increasing permanent employment to 750.
The company is expected to make a decision about its plans in early summer 2008.