For Republican state Rep. Danny McCormick, it’s not just a matter of trying again, but trying harder to correct potential secret government overreach on property rights as the issue becomes amplified by the data center boom in Louisiana.
McCormick has been a persistent critic of alienation of property without owners having sufficient say in what happens to their possessions. In his second term in office, he has sought to shield owners from overaggressive expropriation, side effects of carbon sequestration, and particularly the ability of the Port of Caddo-Bossier from imposing its will in those two parishes.
In 2021, a law was passed that basically gave the Port Commission, an appointive body chosen by area governments, the ability to make economic development deals anywhere in the two parishes without oversight by other elected officials and bodies. Other local governments could not have any input into those deals, or even know any details about these in the negotiating phase. This included tax abatements that could detract from revenues of these governments.
In 2024, McCormick tried to pass a bill (essentially a repeat from the 2023 session) giving a couple of fire districts say in Port decision-making authority over Port contracts that included a payment-in-lieu-of-taxes option, which is a leaseback arrangement that waives local taxes for an entity but requires it to make some payment that would be below taxes owed. This is an alternative to the state’s Industrial Tax Exemption Program, where the state similarly can override local property tax collection for entity even up to 100 percent for five years, although major local governing authorities in the area under consideration may forward recommendations to the state’s Board of Commerce and Industry that makes the final decisions about whether to grant an exception for the entity’s project.
That bill didn’t make it, so McCormick came back last year with a similar, but broader, version. This one applied to the entire two-parish footprint and would give consultation and veto rights to each parish’s government, school district, and sheriff. It hardly was dissimilar to ITEP prior to recent changes that stripped the veto right of the select local governments. That one also met with defeat; in fact, almost every significant local government was against it.
Yet time may be on McCormick’s side with the rapidly-accumulating interest of data centers in setting up shop in the two parishes. Several land deals associated with data center operations recently have come to fruition, and multiple local governing authorities have passed measures designed to aid in center location and operation. These developments have aroused a segment of the citizenry to become skeptical, if not outright opponents, of the potential projects over concerns about secrecy of the deals that could impact them over which it appears they have little control.
McCormick has indicated he will try again this legislative session to clip the Port’s wings with something similar to last year’s effort: consultation and veto by the three kinds of governments. He also seems poised to offer additional bills that could increase local government control over the Port.
At least two Caddo Parish Commissioners, Republicans Grace Ann Blake and Jean-Paul Young (the latter of whom had voted for a resolution opposing last year’s bill), at the meeting where McCormick announced his intentions seemed skeptical of such a bill. Their lines of inquiry portrayed it as hostile to data center location when it is nothing of the sort as if it were assumed the mere fact of consultation and ability to veto would harm chances of landing these big fish.
At first glance, that makes no sense given the presence of ITEP. If a firm didn’t like the idea of going through the Port because it thought an enacted consultation and ratification provision decreased its chances of a successful deal, why not head to ITEP where they could have possibly a total exemption for up to ten years? That appears even better and would moot concerns about the nascent bill.
Except this doesn’t take into account the extraordinary power granted the Port for these deals. Theoretically, it could cut a PILOT deal for up to 99 years with the “payment” being zero and throw in a host of other things, such as extremely low financing costs using its power to tax Caddo and Bossier property owners. But perhaps most advantageously, it can conduct all of this in secret through nondisclosure deals impossible through the very transparent ITEP process. Even just a consultative power that would require action in public would put details out in the open.
Economic development realities acknowledged, at the same time it’s unwise that a local unelected body should wield so much power over citizens’ lives, and in secrecy. There’s no good reason a confined-to-two-parishes/mini-Department of Economic Development (and sitting on fat budgetary reserves with its ad valorem taxation power and state subsidization) should have so much power, so its wings need to be clipped, and whatever bills McCormick introduces could be a good starting point for that task.
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