§ 51:2367 — Louisiana Mega-Project Energy Assistance Rebate

§2367. Louisiana Mega-Project Energy Assistance Rebate
A. In addition to the funding for an economic development mega-project provided
for in R.S. 51:2365 or as a separate incentive, the secretary of Louisiana Economic
Development with the concurrence of the governor may enter into a cooperative endeavor
agreement to grant assistance to a mega- project as defined in R.S. 51:2365(F) the Louisiana
Mega-Project Energy Assistance Rebate as provided for in this Section, subject to approval
of the cooperative endeavor agreement by the Joint Legislative Committee on the Budget.
B. The assistance may be granted if the secretary determines that the consumption
of energy will be a major cost component of the operation of a mega fund project and
assistance in moderating the cost of such energy will be a major factor in inducing a mega
fund project to locate, expand, or remain in the state. Also, the assistance may be granted
only if the secretary of Louisiana Economic Development certifies to the governor and the
Joint Legislative Committee on the Budget that the grant of the energy assistance rebate shall
not harm any business located in the state which may be a competitor of the business to be
undertaken by the mega fund project.
C. The Louisiana Mega-Project Energy Assistance Rebate to the mega-project shall
be granted in the form of a rebate of Louisiana severance taxes that were paid to the state on
any natural gas consumed or used directly in the operation of the mega-project facility or
consumed indirectly in the manufacture or creation of energy sold to the mega-project facility
for its operation, determined as follows:
(1) Prior to implementation of the energy assistance rebate, the Department of
Revenue, at the request of the secretary of Louisiana Economic Development, shall consult
with the operators of the mega-project facility and the following businesses:
(a) The suppliers of natural gas for operation of the mega-project facility.
(b) The utilities or other suppliers of energy which themselves use or consume
natural gas for the production of energy which they are expected to sell to the mega-project
facility for its operation. Utilities shall be entitled to use estimates for reporting purposes.
(c) Any business or series of businesses back to the ultimate severance tax payer,
which are expected to sell natural gas to the businesses described in Subparagraphs (a) and
(b) of this Paragraph.
(2)(a) Based upon such consultation, the Department of Revenue shall require
periodic reports from any such supplier or utility provided for in Paragraph (1) of this
Subsection which will enable the department to make the best estimate of the amount of
natural gas which is consumed or used directly in the operation of the mega-project facility
or consumed indirectly in the manufacture or creation of energy sold to the mega-project
facility for its operation which bears a Louisiana severance tax and the amount of the
severance tax paid to the state.
(b) If the department finds that a supplier or utility not involved in such consultation
is in the chain of supply of natural gas to the mega-project facility or the utilities or other
suppliers as provided in Paragraph (1) of this Subsection, that supplier or utility may also be
required to file the reports provided for in this Paragraph.
(3) Based upon the reports, the secretary of Louisiana Economic Development may
award the Louisiana Mega-Project Energy Assistance Rebate in an amount up to the
Louisiana severance tax that has been paid to the state on natural gas for energy consumed
or used in the mega-project facility operations as determined by the Department of Revenue
at such times as provided for in the cooperative endeavor agreement.
(4) For purposes of establishing the amount of severance taxes which have been paid
to the state relative to the granting of a rebate pursuant to this Section, the amount shall be
determined by reducing the total amount of severance taxes estimated to have been paid by
the amount of such tax which would have been allocated by the state to political subdivisions
pursuant to Article VII, Section 4(D) and (E) of the Constitution of Louisiana.
D.(1) The secretary of Louisiana Economic Development shall promulgate such rules
and regulations for the implementation of this Section in the manner provided for in the
Administrative Procedure Act.
(2)(a) The Department of Revenue shall promulgate such rules and regulations for
the implementation of the consultation and the reports required by the department in order
to make the determination of the amount of rebate which may be granted, all in the manner
provided for in the Administrative Procedure Act. Where specific identification of the
amount of severance tax paid on natural gas consumed directly or indirectly in the operation
of the mega-project is determined by the department not to be reasonably possible, the rules
and regulations shall provide for the determination by estimate of the amount to be rebated.
(b) In addition, in preparing such report, the department shall have any authority
provided to it for examination and investigation pursuant to Part II of Chapter 18 of Subtitle
II of Title 47 of the Louisiana Revised Statutes of 1950, (R.S. 47:1541 et seq.).
(c) Failure to file the periodic reports by any supplier or utility required to do so by
the department as provided for in Paragraph (C)(1) of this Section shall make the supplier
or utility subject to the same penalty provided for failure to file the severance tax report
provided for in R.S. 47:642(A).
NOTE: Subsection E as enacted by Acts 2015, No. 126, §2, eff. through June 30,
2018. See Acts 2016, 1 st E.S., No. 28.
E. With respect to projects for which the secretary makes a determination on or after
July 1, 2015, that the consumption of energy will be a major cost component of the operation
of a mega-fund project, pursuant to this Section, the rebate granted to a mega-project shall
not exceed eighty percent of Louisiana severance taxes that were paid to the state on any
natural gas consumed or used directly in the operation of the mega-project facility or
consumed indirectly in the manufacture or creation of energy sold to the mega-project
facility for its operation, as determined in Paragraph (C)(1) of this Section.
F. No cooperative endeavor agreements shall be entered into pursuant to the
provisions of this Section on or after July 1, 2017.

Legislative History

Acts 2010, No. 1006, §1, eff. July 1, 2010; Acts 2015, No. 126, §2, eff. July 1, 2015; Acts 2016, 1 st Ex. Sess., No. 28, §2, eff. April 1, 2016; Acts 2017, No. 386, §2, eff. June 23, 2017.