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Sen. Bodi White, R-Central

After hearing a legion of local officials sharply criticize his proposed system for handling the Industrial Tax Exemption Program, in which the state forgives a corporation’s local property taxes, state Sen. Bodi White had enough.

His Senate Bill 214, and four others, would streamline a 3-year-old executive order that gave some veto authority to local jurisdictions over state decisions to give away the property taxes locals could use for services like schools and law enforcement — a power that has caused some grief in the business community.

“We’re taking the local money, that’s an incentive to try to get a company to come, a manufacturer to come to your area to create jobs, to create wealth, to give your folks jobs,” White said. Why can’t the locals help?

He then followed his finger down a list of services state taxpayers provide local ones: $3.8 billion for public schools, plus $101 million for a teacher pay raise; $100 million to supplement local enforcement officers; $300 million to compensate business owners who paid local inventory taxes; and tens of millions to build parks and infrastructure through capital outlay, plus much more the state gives local governments.

“We’re like Santa Claus to the locals,” White said.

He’s correct, and his bill was advanced to the full Senate. But White missed the bigger point.

Only in Louisiana does the state so firmly control how local governments raise revenues.

What other state would have to sign off using local tourism dollars to fund local infrastructure projects as lawmakers are considering for New Orleans?

Frankly, ITEP is a rich parish problem. Manufacturers, for the most part, are not wanting to locate in the fast-evacuating central and northeast Louisiana parishes. But ITEP underscores the power relationship in which local governments must come on bended knee to Baton Rouge for handouts rather than the state giving them the tools to raise revenues on their own.

With limited sales and property tax collections — and only a small shot at landing any manufacturer — small-town Louisiana has to look at things like speeding tickets to balance budgets.

For real-world impact, look no further than the gubernatorial campaign.

While Democratic Gov. John Bel Edwards, who is running for re-election this fall, trumpets the state’s economic strides, his GOP opponents focus on the state’s comparatively high unemployment. They’re both right, but they both rely on figures influenced by the declining fortunes of small-town Louisiana: Republicans skew north, Edwards looks south.

Statewide Louisiana’s unemployment rate in March was 4.7%. Alabama and Arkansas were at 3.7% unemployment. Texas was at 3.8%.

But consider that East Baton Rouge, Lafayette and Jefferson/St. Charles parishes had a 3.4% unemployment rate, according to the federal Bureau of Labor Statistics.

Houston, which has more residents than all of Louisiana, was at 3.8%. And the Texas counties near the Sabine River had unemployment rates between 5.5% and 7% as compared to Louisiana parishes of Calcasieu, 3.1%, and Cameron, 2.9%, just across the state line.

What throws off Louisiana’s performance are northeast and central Louisiana, where West Carroll Parish hovers at 10.2%, East Carroll just a little less. Madison, Tensas and Franklin parishes each are nearly double the state’s average.

A handful of legislative efforts are attempting to help the cash-starved small towns and rural parishes.

State Treasurer John Schroder is championing a package of bills that would allow him to transfer unclaimed property into a dedicated fund. The money would help small towns take out loans to pay for needed infrastructure improvements.

And Jonesboro Republican state Rep. Jack McFarland pushed through committee legislation to provide a means of financing the expansions of small-town businesses whose profits, while still in the black, have been slipping or stagnating. A state investment firm would help the borrower develop a business plan, and the state would participate in a loan made with a local bank — basically acting like parents guaranteeing a loan for one of their children. It helps the business, helps the bank, and eases the suffering of the rural tax base, he said.

“We need to create greater opportunities, and helping small businesses having trouble getting capital helps local governments to be more independent,” said McFarland, who adds he’s realistic enough to know that the people running state government aren’t going to embrace any changes that diminish their power in Louisiana’s top-down system.


Follow Mark Ballard on Twitter, @MarkBallardCnb.