Louisiana

LOUISIANA The port state of Louisiana remains at the top of our all four export measures. Much of the state’s exports are related to the agriculture and energy economies, but manufactured exports include various chemicals and machinery. The state’s primary trading partners are China, Japan, and Mexico.

Cuts and Savings Louisiana is facing a $1.6 billion budget shortfall, which Governor Bobby Jindal has sought to close with roughly $1 billion in proposed cuts and savings. The remaining shortfall will be covered by one-time revenues generated by, among other things, the sale of state prisons and surplus property. The governor’s 2011–12 spending plan also includes more than $400 million in one-time revenues that will be used to make up for the loss of federal stimulus dollars. In the proposed budget, public colleges and universities would face no net loss of revenues next year when money from tuition increases is factored in.

Private doctors, hospitals and other health care providers treating Medicaid patients also would not see their rates reduced, nor would any Medicaid patients lose eligibility for services. Louisiana State University public hospitals, however, would see a 4.5 percent cut, and many state employees who now contribute 8 percent of their salaries toward their pensions would be asked to contribute 11 percent.

Programs to Create Quality Jobs Louisiana is home to strong traditional industries, such as petrochemicals and shipbuilding, as well as newer growth industries with strong foundations in technology and research. These growth industries include advanced manufacturing, agribusiness, clean tech, and energyrelated industries. The state has designed programs and industry.

The Technology Commercialization Credit and Jobs program provides tax credits for companies that invest in the commercialization of Louisiana technology and create new jobs. Qualifying businesses that invest in the commercialization of technology in the state may be granted a refundable tax credit on any income or corporate franchise tax liability and earn a refundable tax credit based on new jobs created. Qualifying research centers 62

Louisiana’s Place in the Rankings 2nd

Per Capita Income Growth

2nd

Growth in Share of National Exports

2nd

College Affordability

3rd

Business Birth Rate

4th

Export Intensity Growth

4th

Export Growth

5th

Export Intensity

9th

State and Local Tax Burden

10th

Entrepreneurial Activity

13th

Economic Output Per Job

17th 19th

Short-term Job Growth

19th

Small Business Lending

21st

Cost of Living

22nd

STEM Job Growth

that develop Louisiana technology to be commercialized may be granted a refundable tax credit based on new jobs created. Such credits are granted for a period of no less The Quality Jobs program provides a cash rebate to companies that create high-paying jobs and promote economic development in the state. The program provides 5–6 percent cash rebate on annual gross payroll for new jobs for up to ten years. It also allows for 4 percent sales/ use tax rebate on capital expenditures, or a 1.5 percent industry’s bottom line.

The Research and Development Tax Credit encourages existing businesses with operating facilities in Louisiana to establish or continue research and development activities within the state. As part of this program, Louisiana taxpayers who incur research and development expenses may be able to receive credits against state income and corporate franchise taxes. The program provides businesses that employ fewer than 50 Louisiana residents a credit of up to 40 percent of the apportioned amount of their expenditures. Additionally, businesses that claim federal income tax credits for research activities can receive a credit of up to 20 percent of their apportioned increase in research activities, or 25 percent of their apportioned federal credit, depending on the number of resident employees. critical employees, the state’s FastStart program provides customized recruitment, screening, and training to new and expanding companies, all at no cost. Recognized for has established a presence among workforce solutions programs nationwide. Based on a company’s immediate and long-term workforce needs, FastStart crafts unique programs that ensure workers are prepared on day one and beyond. The relationship between FastStart and Louisiana employee is hired and trained. Working with companies, a team of industry experts assesses workforce needs and then for each company. They use the latest technology to create modules that can eliminate training time by up to twothirds, helping businesses to open their doors quickly when productivity matters most. Designed to be service-minded companies round-the-clock availability and immediate response time.

Certain energy companies may also be able to take advantage of the state’s Digital Media Incentive. As part of this program, businesses that develop software for purposes such as accounting, lease management, well design, seismic evaluation and 3D visualization may qualify for the program, which provides a 35 percent tax credit for payroll expenditures and a 25 percent tax credit on production expenditures. Businesses paying taxes in Louisiana can use these credits to reduce their tax liability.

For companies without a large tax liability, there is a welldeveloped market for selling the credits.

Research centers and universities throughout the state are fueling innovation and providing skilled workers to energy companies. A number of Louisiana universities graduate new petroleum engineers each semester, including the

University of Louisiana at Lafayette and Louisiana State University. Both of these universities are also pioneering research into new eco-friendly alternatives to fossil fuels.

Exports are King Capitalizing on its proven prowess in exports, the state provides incentives and an extensive transportation and logistics infrastructure to bolster trade and export opportunities. Louisiana’s port system is one of the most extensive in the world, transporting tons of cargo in and out of the country. Businesses in the state have access to a variety of robust logistics choices, including six Class One railroads, seven commercial service/primary airports, an integrated interstate grid and a vast deepwater port system.

For advanced manufacturing, the state effectively provides a zero corporate income tax environment for items produced in Louisiana and shipped out of state (single sales tax apportionment). Electricity, water, natural gas, machinery and equipment used by manufacturers are all exempt from Louisiana sales taxes.

The state’s robust transportation and distribution infrastructure is a strong foundation for export-oriented agribusiness and clean tech industries. With approximately $30 billion generated each year, agribusiness is a local commodities and raw materials, as well as valueadded growth opportunities. Louisiana’s strong energy legacy serves as a foundation for the nation’s growing clean tech industry. The state also offers a businessfriendly regulatory climate for clean tech companies, illustrated recently by the elimination of the sales tax on manufacturing machinery and equipment and the franchise tax on corporate debt.

Clusters in Louisiana Largest Cluster: Energy (Fossil & Renewable), 242,346 jobs Largest Growth Cluster: Business & Financial Services, 36,864 new jobs since 2002 Most Competitive Cluster: Energy (Fossil & Renewable), 14,196 new or retained jobs due to state competitive advantage Most Concentrated Cluster: Energy (Fossil & Renewable), 1.94 times the national concentration level

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