Developers can begin submitting for tax abatements after council overrides Holden’s veto
Now the work begins.
With the Metro Council overriding Mayor Kip Holden’s veto of the economic opportunity zone at Wednesday’s council meeting, the next step for city-parish officials and north Baton Rouge advocates is recruiting businesses to plant roots in the oft-maligned area.
The council voted 8-4 to override the veto after more than 80 minutes of discussion from council members, north Baton Rouge civic leaders and Mayor Kip Holden and Chief Administrative Officer William Daniel.
The economic opportunity zone is a district within which developers and small businesses owners and entrepreneurs can receive property tax abatements of up to 10 years for developments. The zone covers everything within the city limits north of Florida Boulevard except for the Downtown Development District and the land of the Baton Rouge Metro Airport.
Metro Councilman John Delgado, who sponsored the ordinance, says the abatements available are a restoration tax abatement for reviving old buildings and a property tax-only tax incremental financing district.
To receive the abatement, developers must apply through Louisiana Economic Development, says Jared Smith, director of business development for East Baton Rouge Parish with the Baton Rouge Area Chamber. Once LED receives and OKs the application, it goes to the East Baton Rouge Parish Planning Commission staff, who would verify the property is within the district and ask for public comment by anyone who might be affected.
Planning Director Frank Duke says the application would not go to the Planning Commission board before going to the Metro Council, but the Metro Council would receive a report on potential economic impact of the project by the Planning Commission staff.
If the council approves the application, then it goes back to LED and the state Board of Commerce and Industry for final check before going to Gov. John Bel Edwards’ desk for final signature, Smith says. At anytime, once the project has cleared the Metro Council, the Commerce and Industry Board or the governor could ax the proposed development for one reason or another, Smith says.
At the meeting, Councilman Joel Boé asked fellow Council member Chauna Banks-Daniel and the #NBR Now Blue Ribbon Commission she created to compile a top 10 list and bottom 10 list of the types of businesses it wants and does not want to come to north Baton Rouge.
Delgado tells Daily Report that the ordinance only defines the economic development district, and municipalities with similar districts routinely pass resolutions to say what type of business development they would like to see within the district.
“It’s not like anyone is going to be automatically excluded, but we want to set out parameters,” Delgado says.
He adds the district would strictly be for commercial development, not residential.
Developer Rinaldi Jacobs, a staunch advocate for north Baton Rouge and member of the Baton Rouge North Economic Development District, says he wants to make sure the tax money that eventually comes in from the increased development goes back into north Baton Rouge—unlike what has historically happened with other development plans.
The Baton Rouge North Economic Development District that Jacobs is a part of was created by state Sen. Regina Barrow to spur economic development in north Baton Rouge and help drive commercial and retail development.
Jacobs says he supports the idea of the ordinance, but not quite as it’s written. He says he wishes the economic opportunity zone would be tweaked to avoid tax destabilization in the area.
“If we are losing too many tax dollars based on large-scale development, what’s the point?” Jacobs asks.
Instead, he says a better way would be to give 50% property tax abatements, instead of the 100% abatement, and put the other 50% into something like blight elimination or help fund the East Baton Rouge Redevelopment Authority.
Jacobs says development is happening in north Baton Rouge, pointing to the proliferation of dollar stores that cost more than $2 million each to build.
Dollar stores are something council members have said are not needed in north Baton Rouge, but Jacobs asks if the council will deny abatements to those companies, what other businesses are they going to give the abatements to?