Last Modified: Wednesday, May 01, 2013 5:50 PM A $13 million deficit for 2013-14 is causing the Calcasieu Parish School Board to have second thoughts about a $600,000 tax credit it granted to Aeroframe Services at the Chennault Industrial Airpark. A board committee voted 11-2 not to extend a 2003 agreement with the company that repairs and refurbishes aircraft and related components..
The full board will take up the issue at its May 7 meeting. The credit amounts to a $5,000-per-employee tax break. It would decrease by $120,000, or 20 percent for each employee each year for the next five years.
Members of the Lake Charles City Council voted to grant Aeroframe an extension of its agreement totaling almost the same amount. Mayor Randy Roach called it good business, even though budget deficits have been projected by the city’s finance office for two consecutive years.
Randy Robb, Chennault’s executive director, has been encouraging local entities to allow the extension. He said Aeroframe took over the company after EADS had trouble keeping the business going. Even now, foreign competition in the aviation sector is hindering Aeroframe’s growth, Robb said.
“This type of industry is very competitive, and the margins are wafer thin,” Robb said. “This renewal is crucial, because a tax burden at this time will cause an undue hardship on our expanding business. And they are trying to get on their feet. Right now, they aren’t in a good position.”
In spite of its deficit, Karl Bruchhaus, the Calcasieu School Board’s longtime chief financial officer, thinks the agreement should be continued because of the economic opportunity it creates. Aeroframe has 400 employees who are taxpayers and contributing members to the community.
Roger Porter, Aeroframe president/chief executive officer, said the tax breaks are “crucial in promoting a competitive advantage in our industry.”
Dale Bernard, one of the two board members who voted to continue the agreement, said, “I certainly don’t want us to dig a deeper hole, but I don’t think $600,000 will make that much of a difference toward alleviating the $13 million deficit.
“I’m trying to keep the employment we have in the city. By voting for it, I was supporting Mayor Randy Roach and our financial director. I’m sorry the other board members didn’t see it that way. I hope we can come to a compromise.”
The future looks bright for Southwest Louisiana, but pending projects are a few years down the road. Aeroframe is different. It is up and running and becoming a major economic engine in this area.
Members of the School Board are looking at a hiring freeze and consolidating low-attendance schools, and say they are confident they will do whatever has to be done. Meanwhile, we hope the board sees the value in extending the Aeroframe agreement, which makes up only 4.6 percent of its projected deficit. It has proved so far to be a wise economic investment for this community.
This editorial was written by a member of the American Press Editorial Board. Its content reflects the collaborative opinion of the Board, whose members include Bobby Dower, Jim Beam, Crystal Stevenson and Donna Price.