Louisiana § RS 47:1517.2 - Tax incentive and economic development program evaluation and reporting; powers and duties of the legislative auditor

§ RS 47:1517.2. Tax incentive and economic development program evaluation and reporting; powers and duties of the legislative auditor

            A. For purposes of this Section, the following terms shall have the meanings ascribed to them in this Subsection:

            (1) "Economic development program" means any state program which directly or indirectly confers fiscal benefits on employers located in the state for the purpose of retaining and creating jobs and growing the state's economy. Such programs may include grants, loan guarantees, and tax exemptions, exclusions, credits, and rebates, but only to the extent that such benefits are used by an identifiable group of employers in the same or a similar business. The ten-year property tax exemption and the inventory tax credit shall not be deemed economic development programs for purposes of this Section.

            (2) "Tax incentive" means any tax rebate or tax credit.

            B.(1) The legislative auditor shall have regular evaluation and reporting authority concerning tax incentives and economic development programs in accordance with R.S. 24:513 and shall evaluate and report on each tax incentive and economic development program at least once every four years.

            (2) The legislative auditor shall evaluate each tax incentive and economic development program administered by a state agency. The legislative auditor may exempt from evaluation any incentive or program that he concludes has a minimal fiscal impact.

            (3) The legislative auditor may contract with a private company, nonprofit, or academic institution to assist with evaluations.

            C.(1) The legislative auditor shall prepare a cost-benefit analysis of tax incentives and economic development programs and an analysis of the impact of those incentives and programs on state revenue. The cost-benefit analysis shall include all of the following:

            (a) The creation of jobs.

            (b) The effect on personal income.

            (c) The effect on gross domestic product.

            (2) The legislative auditor shall independently evaluate the effectiveness of each tax incentive and economic development program authorized by the legislature. The evaluation shall include all of the following:

            (a) Analyzing economic impacts created or constrained by the tax incentive or economic development program.

            (b) Forecasting the utilization of tax incentive maximums and impacts of extending tax incentives and economic development programs.

            (c) Determining whether there is a local sales tax increase or decrease from the tax incentive or economic development program, quantifying the revenue impact on a parish basis, including by requiring local sales tax collectors to report to the legislative auditor information that he may require.

            D. Evaluations shall also include the following assessments:

            (1) Whether adequate protections are in place to ensure that the fiscal impact of the incentive or economic development program does not increase substantially.

            (2) Whether the company receiving the incentive or participating in the economic development program is achieving its goals.

            E. The legislative auditor may require companies receiving tax incentives or participating in economic development programs to take part in evaluations and accurately verify data.

            F.(1) If the legislative auditor determines that a company receiving a particular tax incentive or participating in a particular economic development program has refused to submit data pursuant to this Section or has not met the contractual obligations for the incentive or program, then the legislative auditor may recommend to the administering agency that the company may no longer be eligible for that incentive or program.

            (2) If the legislative auditor determines that a company may not be eligible for a tax incentive or economic development program pursuant to Paragraph (1) of this Subsection, the legislative auditor shall notify the agency administering the tax incentive of the determination. Within ninety days of being notified by the legislative auditor, the administering agency shall provide a written response to the legislative auditor regarding the legislative auditor's evaluation of the company and, if necessary, include a proposed remedy to the legislative auditor's conclusion. The administering agency shall transmit the response to the legislative auditor and the company simultaneously.

            G. The legislative auditor shall publish and submit to the legislature a quadrennial report concerning evaluations conducted pursuant to this Section. The legislative auditor shall submit the initial report required by this Section on or before December 31, 2026. The report shall include recommendations to the legislature for specific reforms for tax incentives evaluated pursuant to this Section.

            Acts 2025, No. 377, §1.