On February 21, 2024, Governor Jeff Landry issued Executive Order No. JML 24-23 (EO No. 23-24) providing for the conditions for participation in the state’s Industrial Tax Exemption Program (ITEP). The ITEP provides for a property tax exemption for manufacturing facilities. Under the Louisiana Constitutional, art. 7, Section 21(F), subject to terms approved by the Governor, the Board of Commerce and Industry (BCI) may grant an exemption contract to a manufacturing facility for an initial 5 year term and a renewal term of 5 years. The ITEP can be up to a 100% abatement of property taxes for the manufacturer. Under Governor Edwards, the abatement was capped at 80% for most new projects and local government approval was required.

Under EO No. 23-24, Governor Landry has retained the 80% abatement for advance project notifications filed on or after February 21, 2024. EO No. 23-23 specifically does not apply to advance project notifications or ITEP contracts signed before February 21, 2024. EO No. 23-24 contemplates the approval of a “Local ITEP Committee” composed of local elected officials; however, the approval of the Local ITEP Committee will not be dispositive of the ultimate approval of the ITEP by the BCI or the Governor. In addition, under EO No. 23-24, the Louisiana Department of Revenue (DOR) will review each ITEP application and must provide a letter of approval or no objection. EO No. 23-24 does not define the parameters of the LDR’s review of the ITEP Application.

EO No. 23-24 can be found here.

If you have questions on ITEP, contact Jones Walker SALT partner, Jay Adams.