Proposed House Bills 674 and 694, which would give local government entities the capability to temporarily grant property tax breaks to companies that shift their operations to the state, passed the Louisiana State Senate recently. Some of the basic requirements for the property tax to be an option include having to hire at least 50 new, full-time positions as well as having to spend $25 million on the commercial real estate on which the building is located.
The bills did not pass through the Senate unchanged, however. Several significant additions were included in the Senate versions of the bills, including additional requirements before a parish can opt into the program. The original bills required only that parish governments support the program, the Senate version requires that municipalities, school boards, law enforcement and the local tax assessor all provide their support now as well. These added requirements seek to allow those in the local community who are unsupportive of the move to be capable of preventing it. The bills now head back to the House so the two differing versions can be reconciled.
Many businesses grapple with finding locations for a new business or managing the legalities of real estate. For the people who run these businesses, understanding the details of complex real estate transactions is critical.
Issues such as drafting purchase agreements and negotiating with property owners or developers can be difficult without the help of those experienced in the business of commercial real estate. It is advisable that any business needing to acquire commercial real estate talk to an experienced lawyer.
Source: The Times-Picayune, “Bills allowing property tax breaks for recruiting companies pass Senate,” Jeff Adelson, May 24, 2012