‘Kerotest Committee’ recommends tax breaks
The “Kerotest Committee” of representatives of local taxing authorities collecting property and sales taxes from Kerotest Manufacturing has agreed on a revised tax incentive package for the valve plant’s proposed expansion.
However, the proposal still has to be approved by the full boards of the taxing authorities and accepted by Kerotest. Then it has to go to the state Board of Commerce & Industry for state approval of Kerotest’s request for the tax incentives.
Avoyelles Police Jury President Charles Jones said a committee of representatives from the Police Jury, School Board, Sheriff’s Office and Town of Mansura has proposed offering an 8-year 80 percent property exemption on the expansion, meaning they would collect 20 percent of the property tax for that project for eight years and then 100 percent after that.
Kerotest had asked for a 100 percent exemption for five years and up to an 80 percent exemption for another three.
100% sales tax rebate
The group agreed to give back a little of that on the sales tax side of the package, recommending a 100 percent rebate on the Police Jury, Law Enforcement and Mansura sales taxes for the expansion project. The School Board will keep 100 percent of its sales taxes due to a state law that prohibits rebating any portion of sales taxes collected for public education.
Kerotest had said it would need a 50 percent waiver of sales taxes on the construction costs and equipment purchased for the expansion. It would pay the full amount up front and then be reimbursed 50 percent if it met the conditions of the exemption.
Kerotest officials have said the company would need sufficient tax credit incentives to make the proposed $4.3 million expansion project feasible.
The expansion project would create about 50 new jobs and could lead to future expansion if the market conditions continue to demand more of the valves the plant produces.
The company needs to expand to meet growing demand for its industrial valves, which are used primarily in natural gas pipe lines.
The increased demand is mainly related to replacing aging infrastructure in the East and Midwest.
The Police Jury, School Board and Mansura Town Council will be voting on the committee’s recommendation in the near future.
It is still possible that the various taxing authorities will “go their own way” and not agree on a consensus recommendation for a tax incentive package, Jones said.
There have been some calls for the local taxing entities to grant Kerotest what it asks for to promote economic development and create jobs.
Others have said governments need to grant tax exemptions, waivers and rebates in moderation.
Jones said he has even heard some say granting “give-aways” to large industries is not right or fair.
Under the tax incentive agreement, Kerotest would have to pay any taxes under the project if it did not meet the economic development promises in the request for the tax breaks.
The company would continue to pay sales/use and property taxes on its existing plant operations. The tax breaks would be only for the new project.