Two Baton Rouge-based manufacturers are vying in August for East Baton Rouge Parish Metro Council leaders to approve applications for the Industrial Tax Exemption Program. 

Stupp Bros. Inc. and International Mezzo Technologies Inc. are seeking tax breaks for multimillion-dollar expansions. 

Stupp Bros. manufactures steel pipes for the oil and gas industry in addition to the U.S. Department of Defense. The company expects to invest $22 million to modernize its steel manufacturing facilities in Baton Rouge, which date back to the 1950s. The manufacturer expects to hire 128 employees and retain 338 workers at the company. It is eligible for up to $2.5 million in property tax exemption over 10 years, if approved by the local taxing authorities, which include the school board and sheriff's office. 

The company wants to modernize its operation in Baton Rouge and hire more workers to meet an uptick in demand for steel pipe, a Stupp representative said. 

"Before embarking upon any investment campaign, Stupp conducted an analysis regarding many facets of the proposed series of investments, including the possibility of receiving state and local incentives," said Chip McAlpin, vice president of corporate strategy and development at Stupp.

The company described the potential economic incentives as "very valuable" and expects to take property tax savings and reinvest in the business. 

Meanwhile, International Mezzo Technologies which manufactures heat exchangers, expects to invest $93,100 in new machinery. The business already has 42 employees and anticipates hiring two more. The value of the 10-year property tax deferment is worth $13,365 for the manufacturer.

The business has saved roughly $100,000 in tax exemptions over the past few years, according to the company. 

Kevin Kelly, president of International Mezzo Technologies, said that his company is able to re-invest that money in the business and hire more employees.

"It's a substantial amount of money for us," Kelly said, "we have potentially for great growth." 

If the East Baton Rouge Metro Council rejects the application, the company might not move forward. 

"We might still go ahead but it puts some damper on our plans," he said. "We won't be able to move forward so aggressively. It's not a black and white situation." 

If there was a significant change in support of local manufacturers, the executive said he would be tempted to consider other locations, such as North Carolina. 

In 2016, the Industrial Tax Exemption Program rules were changed from 100% property tax exemption over 10 years to two five-year stints with no more than 80% of property tax abatement during that time frame. 

In June, the East Baton Rouge Parish Metro Council voted unanimously to approve its first new ITEP project for Super Insulation since the changes went into effect. Likewise, the East Baton Rouge School Board and the East Baton Rouge Sheriff's Office approved Super Insulation's application for tax abatements worth $1.2 million over 10 years.

Meanwhile, in Lafayette local leaders have decided against tax exemptions for a manufacturer that sells tools for the oil and gas industry. The Lafayette City-Parish Council rejected the application from Service Machine and Supply, which would have exempted the business from $11,000 in property taxes over 10 years. 

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