Developers and property owners get another five years of tax incentives should they locate their redevelopment projects in north Baton Rouge following the East Baton Rouge Parish Metro Council's extension of a special taxing district for the community.
The council on Wednesday night chose to continue the north Baton Rouge Opportunity Zone through 2026 — an action that only drew one vote in opposition, from council member Denise Amoroso.
City-parish leaders pledged to do a better job at promoting the tax incentive, which attracted approximately $16 million in investments during its first five years, for an area of town that was crippled by years of disinvestment.
"When you look at other parts of town and other investments, you have one project that exceeds $16 million, but that's a huge impact on our community," said council member Cleve Dunn, Jr., who sponsored the measure. "I think in the next five years we can double or triple that $16 million."
Should developers continue receiving special tax breaks for locating their projects in north Baton Rouge?
Dunn previously said the opportunity zone not only spurs revitalization in a disinvested community through job creation and neighborhood investment, it also curbs excessive crime that historically hampered development on that side of town.
City-parish planning commissioners say the North Baton Rouge Opportunity Zone operates more like an economic development district than most tax abatement programs by focusing on restoring commercial and residential properties without any legal mandate to actually create jobs.
Developers apply for the incentive through the Louisiana Economic Development's Restoration Tax Abatement program. The city-parish Planning Commission is also involved, but mostly to approve projects that already won the state's blessing.
According to criteria posted on LED's website, projects can qualify for tax abatements by expanding, restoring or in some way improving existing structures within approved development, historic or opportunity zones. Tax abatements are eligible on, among other expenses, building materials, machinery and equipment, laboring and engineering work.
Non-eligible expenditures include acquisition costs for structures or land, and any movable and personal property.
Since the opportunity zone launched in 2016, there has been approximately $16.8 million in total investments tallied from the five projects that have applied for the north Baton Rouge tax incentive.
A comprehensive report highlighting those projects shows they've created 21 permanent jobs and 124 construction jobs to date. Annual tax abatements totaled around $968,000, with an estimated loss of about $100,000 to the city-parish general fund over the course of five years.
The list of approved projects include:
- Brown Eagle Warehouse, 7808 Airline Highway. Approved Aug. 22, 2018. The $2.9 million project was for improvements made to a building that would package and warehouse alumina for large commodity and chemical manufacturers. It created 12 permanent jobs.
- CR Apartments, 2080 North Lobdell Blvd. Approved April 25, 2018. Developer renovated a 312-unit apartment complex. The $3.5 million project created one permanent job.
- LA Fish Fry Products, 1450 Airway Drive. Approved Nov. 13, 2019. The $1.3 million project involved renovating a vacant warehouse into a storage-distribution facility. It created four permanent jobs.
- GCHP Progress Park. Approved Feb. 26. 2020. The $3 million project involved renovating deteriorating single-story duplexes into units for the elderly earning 20% to 60% of the area's median income. It created one permanent job.
- The renovation of a 248-unit apartment complex at 2136 North Lobdell Blvd. Approved Aug. 10, 2016. The $6 million project created three permanent jobs.
Former Mayor-President Kip Holden tried to veto Metro Council's creation of the opportunity zone in 2016, saying it would render the city-parish "bankrupt behind that scheme." Holden also said the district was too large and would deprive the city-parish of too much money.
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The special zone encompasses pretty much everything north of Florida Boulevard and within the Baton Rouge city limits. It's one of 17 economic development districts in the city-parish.
Former council member John Delgado, who authored and lobbied for the ordinance that created the district, said Wednesday that, given some of the opposition five years ago, he's impressed with the investments and projects the district has attracted thus far.
"The better north Baton Rouge does, the better all Baton Rouge does," Delgado told the council in his plea for the ordinance's extension. "I'm glad to know it has done some good."