Newsflash. The state is broke and needs to make cuts to survive.Perhaps this isn’t as much news as it is a constant state of being for Louisiana.
nfortunately, desperate times often equal desperate measures that do more harm than good. Such was the case with many of our state’s economic development tax credits — the State Historic Tax Credit in particular. It seems each legislative session brings another threat to the credit which improves our downtowns and other historic areas.
This time around, HB 355 and HB 362 by Rep. Barry Ivey, R-Baton Rouge, took aim, in part at these important credits.
In the wake of these bills, the Shreveport Downtown Development Authority took to social media May 16,
rallying the troops to get the bills killed, or at least amended.
“Please write a short email, or make a short phone call, to your House member (and others). This morning, the House of Reps may consider House Bills (HB) 355 and 362 by Rep. Barry Ivey. BOTH, in their current form, would repeal the state Historic Tax Credit,” the call to action said.
Now many may think the elimination of any and all tax credits are necessary in such dire budgetary times. That broad-based approach is not only dangerous, but ill-advised.
According to the DDA, the tax credit more than pays for itself in economic impact. “Two independent studies have concluded the state historic credit provides approximately $3.00 in total tax collections for every $1.00 of tax credit. A just-released study found that $1.00 of state historic tax credit spurs $8.76 in additional economic activity,” the DDA said on Facebook.
The call to action has worked, so far.
On May 17, DDA reported that amendments to HB 355 were approved that would have taken the Historic Tax Credits off the table. Ivey then deferred further action on the bill.
“This is NOT the last fight for HTC,” the DDA said.
Perhaps it is time to take this fight off the table permanently. The issue with this, and many other tax
credits is the assumption that the state is somehow losing money on the deal. That if the tax credits didn’t exist, the money would flow. Wrong.
Many tax credits, like this one, entice businesses, investors, and industry to locate and revitalize areas that would never see growth. It’s not like they would locate there anyway.
We all benefit from revitalized historic districts. We all benefit from thriving downtowns. We all benefit from this tax credit. It is time to leave it alone, once and for all.