Despite the state budget being in the news for all the wrong reasons, the Louisiana Department of Economic Development believes it can continue to be a vehicle for industrial gain.

The location changed – New Orleans, Baton Rouge, Lafayette, Lake Charles, Monroe, Shreveport – but the message Don Pierson conveyed remained the same: the state budget crisis won’t prevent his department from keeping established promises to business and luring new jobs to Louisiana.

In early February 2016, weeks after appointed as secretary of the Louisiana Department of Economic Development by new governor John Bel Edwards, Pierson barnstormed across the state to ease concerns of anxious employers and employees worried about their own financial well-being and the overall economic health of the region.

“The needs of one place, like Lake Charles, are going to be different than the needs of New Orleans or Monroe or Baton Rouge,” Pierson says. “By making the effort to conduct an in-person dialogue with the 8 (regional) agencies across the state…we were able to collaboratively discuss issues that might affect commerce or industrial growth and expansion.

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“We were also able to message that we have a lot of resources available to Louisiana’s small businesses that we feel have been under-utilized. A big effort needs to be made to communicate all the resources available to small businesses out there – whether it’s writing a business plan so you can go to your bank and increase your line of credit, or whether it’s learning to implement social media or web-based marketing.”

Speaking of programs, Pierson placed added emphasis on his words when reassuring businesses that the uncertainty of the state budget will not impact previous commitments made through various economic growth programs and incentives. The state will honor all contracts and performance-based partnerships, and will continue to deliver on all promises previously established. In addition, Pierson trumpeted the need for these industry-friendly initiatives to continue to encourage growth within already-functioning businesses but also keep Louisiana an attractive landing spot for large manufacturers – the types of businesses generally found within the Port of South Louisiana’s Port District.

“We need these tools to continue to go out and win projects for the state of Louisiana,” Pierson says. “That can be seen through the eyes of our ports. Our ports are in competition with Gulfport, with Mobile, with Tampa, with Savannah. There’s all kinds of competition out there. So it’s very important that we keep the tools we need to be competitive. A reduction of those tools might make us less competitive, and at the end of the day, if we win fewer projects any cost savings with those programs are not realized. What you’ve (saved) is lost in opportunity cost.”

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In the last state legislative session, every Department of Economic Development incentive program was dissected and analyzed thoroughly. Reductions in funding reached upwards of 20 percent within some programs, though Pierson was quick to point out the “workhorse” projects already in place are capable of recruiting job-producing industry to Louisiana.

For instance, the Industrial Tax Exemption Program, which is only offered to manufacturers, provides a ten-year property tax waver to ease the start-up financial commitment. Also, the Quality Jobs Program rebates 5 percent of a company’s payroll for ten years if the jobs created meet a high pay standard and include health insurance.

All money given or tax breaks provided from these programs are contingent on the company reaching performance-based target – usually the number of jobs produced and the payroll averages of those jobs. The pre-established minimum threshold is put in place as insurance that the business remain a viable investment for Pierson’s department. When companies fail to meet those standards, the state conducts a “clawback,” which requires repayment of those dollars to Louisiana.

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“The perception that Louisiana Economic Development participates in corporate welfare, nothing could be further from the truth,” Pierson says. “What we do is provide public funds to private corporations when there’s a CLEAR return on investment to the people of Louisiana….We don’t treat the public dollar as venture capital. We don’t put those dollars at risk.

Those dollars are protected. These are secured investments.”


By William Kalec



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