THE INVESTIGATORS: Residents sue Ascension Parish over secret $450 million deal

Updated: Oct. 13, 2017 at 3:26 PM CDT
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ASCENSION PARISH, LA (WAFB) - A group of residents filed a lawsuit Friday against the Ascension Parish Council over the council's secretive actions of giving away $450 million to a handful of private businesses through property tax exemptions.

The residents are part of Together Louisiana, a grassroots organization seeking to reform the way parish leaders divert tax dollars that would otherwise go toward public education. The lawsuit asks the court to void the tax exemption agreements.

The Ascension Parish Council drew criticism from many of its residents when it refused to identify the businesses that would be receiving the tax dollars and instead referred to them through code names such as Bagel and Sunflower Seed.

At a press conference outside the courthouse Friday, Henrynne Louden, a retired pediatrician who is one of the plaintiffs, said "it's obviously ludicrous" that the council would use such a guise to spend taxpayer money.

"This is not a spy movie," Louden said. "We are talking about monies that do not go to the schools."

The lawsuit cites an executive order Gov. John Bel Edwards signed last year that requires local governments and school boards to decide on property tax exemptions for companies within their borders. In years prior, those decisions were made at the state level without input from the parishes and municipalities that rely on the property tax revenues to fund schools, infrastructure, law enforcement and other services.

The philosophy behind tax exemptions is that they attract businesses that bring jobs to the area. For decades, however, some of the businesses that received the exemptions failed to deliver on their promise to create new jobs and the state was not keeping track of the job-creation data. The governor's new executive order now requires the companies to provide that information.

Last month, the Ascension Parish Council approved industrial tax exemptions for four companies planning capital improvement and expansion projects. In an effort to conceal part of the decision, the council identified the projects with fictitious names:

  • Project Magnolia - A businesses planning to build a new plant in Geismar. A $145 million investment with seven new jobs.
  • Project Zinnia - A new plant with “breakthrough technology.” A $25 million investment with two new jobs at an average salary of $100,000.
  • Project Bagel - “A major employer looking to expand chemical capabilities.” A $125 million investment with 15 new jobs.
  • Project Sunflower/Seed - A “co-location project” with a consolidated investment of $167 million ($32 million from the owner + $135 million from the co-located provider), slated to bring eight new jobs.

Even on Friday, weeks after the parish had negotiated the tax incentive deals, the parish still refused to identify the companies. However, the 9News Investigators uncovered documents from Louisiana Department of Economic Development that identify at least three of the four companies as Air Products & Chemicals, BASF and Praxair.

Other documents show the Ascension Parish School Board corresponded with the Louisiana Board of Commerce & Industry on behalf of Shell Chemical. The school board wrote that it was "in full support" of renewing a five-year tax exemption for Shell Chemical, though 9News was unable to confirm if Shell's exemption was indeed renewed.

Attorney Brian Blackwell, who is representing the residents suing the parish, dismissed any arguments the companies need to remain private for competitive reasons, saying the company identities must be public whenever a parish committee or council calls for a vote.

"(The council) is voting to give tax exemptions to things that we don't even know," Blackwell said. "It may be some company, for example, that has blown up 10 times in Ascension Parish and you're rebuilding it again with tax dollars."

When asked by a reporter if he believes parish leaders actually know the companies' names but are deliberately hiding them from the public, Blackwell said he has no reason to believe they do know the names.

Ascension Parish spokesman Martin McConnel would not comment directly on the lawsuit but said he believes the governor's new executive order may have created some confusion about how the tax exemptions are supposed to be handled.

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