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|Police jury agrees to place V-Vehicle property tax on October ballot|
The Ouachita Parish Police Jury unanimously agreed Thursday to ask voters to approve a 1.8-mill property tax in the Oct. 17 election to pay a financial obligation that local governments pledged to help lure the V-Vehicle automotive manufacturing company to Ouachita Parish.
The police jury as well as the cities of Monroe and West Monroe agreed weeks ago to put up to $15 million as part of a roughly $85 million incentives package to convince V-Vehicle to locate in the former Guide plant in eastern Ouachita. The state's share of the incentives package totals some $70 million.
The proposed property tax the police jury will ask voters to approve in October cannot be assessed for more than 15 years, and will only cover the $12.45 million obligation of the two cities and the police jury. Once the local obligation is fulfilled, the property tax must be canceled. That is expected to occur within eight years.
OEDC Land Corp. and the I-20 Economic Development Corp. will pay the remainder of the $15 million.
Local governments will sell limited tax bonds to come up with the money that is needed to meet the pledge locals governments made to V-Vehicle. Revenues generated by the proposed property tax would pay off the debt created by the bond sale.
Bill Boles of the Boles Law Firm in Monroe and Grant Schlueter of Foley and Judell in New Orleans will handle the bond sale for the police jury.
"We were able to lock in a very favorable rate because locally owned banks stepped up and participated in this process," Boles said. "This truly is a community-wide effort."
Boles was referring to locally owned banks agreeing to buy the bonds while also agreeing to cap interest paid on the debt at no more than 4.5 percent annually.
Though interest paid on the bonded indebtedness would be capped at not more than 4.5 percent, Boles said if the bonds were sold today the interest rate paid on the debt would be substantially lower.
Foley and Judell's Schlueter said every penny generated by the proposed property tax "must be used solely for the purpose of paying the obligation of the three public bodies."
V-Vehicle officially announced last month it would take over the former Guide plant off Interstate 20 east of Monroe, creating 1,400 new, direct jobs and 1,800 indirect jobs. V-Vehicle says it will manufacture fuel efficient automobiles at the former Guide facility.
According to the Ouachita Parish Assessor's office, the proposed property tax would cost property owners $18 annually on non-homestead exempt property valued at $100,000. Those with non-homestead property valued at $150,000 would pay $27, and residents with property valued at $200,000 would pay $36.
Commercial property owners with property valued at $75,000 would pay $135 annually. Owners of commercial property valued at $100,000 would pay $180.
Police jury president Shane Smiley said the proposed property tax would generate roughly $1.45 million annually.
Monroe Mayor Jamie Mayo is optimistic parish voters will see the importance of having V-Vehicle located here.
"I think the marketing effort is pretty clear," Mayo said. "We're going to ask the voters to support 1,400 direct jobs and another 2,000 indirect jobs."
"There's not a lot more you can add to that because it certainly will be a tremendous investment to the entire parish just with this particular project," Mayo added.
He said the national attention the region will generate from having V-Vehicle start up in Ouachita Parish will breed more success.
"There will be additional opportunities," Mayo continued. "Already we are reaping the benefits of the announcement because we have other inquiries about opportunities.
"National media has contacted us wanting to do specials on the city of Monroe and our region primarily because of this latest announcement in addition to some of the other announcements that have occurred here recently."
If voters reject the proposed property tax in the Oct. 17 election, Mayo said local officials would have "to go to a plan B."
"But I'm optimistic that our community will come through pretty strong to help this project," Mayo said.
West Monroe Mayor Dave Norris said the cities and police jury are obligated to finance the incentives package. If the property tax is not approved by voters in October, local officials would have to determine how to meet the financial obligation.
"I don't know what that would be, though," he said.
Monroe Chamber of Commerce's board of directors unanimously agreed to support the proposed property tax.
"Linda Holyfield, I think, made the best comment, and that's 'businesses pay 86 percent of the property tax, but the more businesses we have that are contributing to that, it diffuses the overall cost for everybody,'" said Sue Nicholson, president of the Monroe chamber.
"If this works as it is supposed to, we will have roughly 3,500 new jobs created, and ultimately everyone will pay less property taxes," Nicholson said. "Some (businesses) are concerned about the impact, but overall, we see growth and quality jobs that can come out of this."
"And the more people we have contributing to the tax base, ultimately the lower the burden will be on everybody," she said. "We see this as something we must do to create quality jobs in our community."
Norris said it would be important for local officials to provide information to the public about the need for the proposed property tax and the benefits of having V-Vehicle located in Ouachita Parish.
"The way this bond issue is structured, the money cannot be used for anything other than to pay that debt, and the debt's not even incurred unless this company meets certain steps along the way," Norris said. "So, they've got to make progress towards doing what they said they were going to do or they don't get anything from the state or anything from local governments."