In a big turnout in which the conservative Republican ticket for president and vice president won with 58%, Louisiana voters also gave a sharp rebuke to the Louisiana Legislature in voting on a constitutional amendment to allow big companies a potentially huge tax break.
And that amendment, called payments in lieu of taxes, or PILOT, was defeated by a 2-1 margin — even greater than the vote for President Donald Trump.
We think the combination of the heavily conservative electorate and a sharp rebuke to the business lobbyists who pushed the PILOT amendment says something significant about what voters are thinking.
A PILOT agreement is a contract between a local government like a police jury and a business, typically one establishing a new industrial plant or expanding an existing facility. Instead of paying property taxes over the life of the new project, often decades, the government would get a large one-time payment.
We opposed this amendment and were not alone in worrying that it would open the door to deals that were in the interests of businesses and local politicians, but not the parish or city giving up long-term tax revenue.
After all, PILOT agreements reward short-term thinking.
A local politician seeking to be reelected in four years would be happy to build roads or other things in the short term. The politicos would be easy marks for a business wanting a lower tax payment for 20 or 25 years, in exchange for a lump sum up front.
It is telling that this idea has failed in the Legislature in normal years. But 2020 is hardly a normal year, and nowhere more so than in the State Capitol. With a House full of green legislators, because of term limits, and with the public almost entirely absent from the building, business lobbyists passed the amendment that went before voters on Tuesday.
That voters rejected it, as well as what we saw as an ill-conceived budget limit proposal — Amendment 4, defeated 56%-44% — that was also a nonstarter in normal legislative years.
The leadership in the Legislature should see this as a rebuke of how business is done in the State Capitol during the pandemic. We hope that it is also a message to lawmakers about “economic development” being defined as giving away the Treasury.
Corporate welfare is in theory limited by the Louisiana Constitution, but the workaround for business lobbyists has been cooperative endeavor agreements — contracts between business and government that allow payments in cash. The trade is no longer the relatively innocent days of using taxpayer money to build a road for a new plant or expand a dock for a shipping line.
Now it is an extortion that has gotten out of hand, in the nation and in Louisiana in particular. We hope the State Capitol gets the message that the voters are skeptical of scams.
— The (Baton Rouge) Advocate