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School Board votes to end Aeroframe tax credit

Last Modified: Tuesday, May 07, 2013 11:23 PM

By Lance Traweek / American Press

The Calcasieu Parish School Board on Tuesday voted 9-5 to not renew a $600,000-per-year sales tax credit for Aeroframe Services.

Board members who voted against renewal said the plan wasn’t in the best interest of the system, which faces a $13 million deficit next fiscal year. Proponents argued that the tax credit, which would have been phased out over a five-year period, is crucial to keeping Aeroframe, and its over 400 jobs, in Lake Charles.

“The last several years we have been hit with hard times. When times were better for us, we were there,” said District 12 board member Joe Andrepont, who opposed renewing the tax credit. “When times are hard, there is no one coming to this board to help us financially.”

Several community officials urged the board to renew the tax credit — including Mayor Randy Roach; R.B. Smith, the Southwest Louisiana Economic Development Alliance’s vice president for workforce development; Chennault International Airport Authority board member Charles Dalgleish; and Roger Porter, president and CEO of Aeroframe Services.

They questioned Aeroframe’s future without the tax incentive.

Without it, Dalgleish said Aeroframe may leave the area and won't pay the taxes anyway.

“We have to do what we have to do to keep this business here,” Dalgleish said. “The margins of profit are razor thin.”

Aeroframe has more than 400 employees with a $20 million payroll.

The board’s staff recommended the tax exemption be renewed.

Karl Bruchhaus, the school system’s chief financial officer, said the 410 people who work at Aeroframe are not included in the exemption.

“This exemption applies strictly to sales taxes that Aeroframe pays,” Bruchhaus said. “It doesn’t apply to all the sales taxes their employees pay when they buy stuff.”

Bruchhaus said the school system benefits whenever Aeroframe's employees purchase goods in the parish.

“That’s why even in our deficit situation, we recommended as a staff the renewal,” he said. “At least this was a phase-out and that’s why we recommended it — the turnover of that money.”

“We do not want to lose 400 jobs,” Smith said.

The Lake Charles City Council recently agreed to extend Aeroframe's tax credit with the city. The credit will continue but it will be phased out over five years. Officials have said that at the end of the term, they will probably revisit the issue.

Roach told the School Board he understands the challenges it faces with its deficit but called the tax credit “critical and important” for Aeroframe’s continuing existence at Chennault.

Porter said Aeroframe posted losses the last two years and that the tax credit would give the company the ability to “compete on a global market.” Porter added that a tax exemption in the aviation MRO business is common.

District 6 board member Bill Jongbloed, one of the five who voted for the extension, said he favored the idea because of recommendations made by officials.

“All of these are very knowledgeable, credible people who know more about the situation than any of us,” he told fellow board members. “When they all come up here and ask for a little help, I’m thinking we better listen.”

The incentive began in 2003 for EADS. Aeroframe inherited the credit from EADS, benefiting from about $5.4 million in tax credits since December 2005. The arrangement expires at the end of May.

The tax credit would have started at $600,000 and decreased by $120,000 each year. If the phase-out had been approved by the school board, Aeroframe would have received $1.8 million in tax credits for the five-year period.

Posted By: zemkarlos On: 5/18/2013

Title: Roof repair Specialist

I completely agree with the above comment, the internet is with a doubt growing into the most important medium of communication across the globe and its due to sites like this that ideas are spreading so quickly.

Posted By: PQW On: 5/9/2013

Title: Halarious

20 mil divided by 400 is 50,000 Why is it again you could only make 92 bucks a week? lol

Posted By: PQW On: 5/9/2013

Title: Current Employee

If you worked 60 hours a week and only got 92 bucks then you should have done more work and less talking. I had no problem bringing home $2200 for 38 hours worth of work. I did that at least once on every bird that came in. Thanks to piece rate, those that worked got paid and those that talked, did not know what they was doing or just too damn lazy got paid nothing. I was in nobodys click but I got fed the paperwork because I worked and got it done. The FAA states you must be able to speak and write the English language so since neither of you can do that, I take it you are not licensed A&P mechanics? I for one would hate to see Aeroframe go.I can't go anywhere else in this town and make the money I am making now. The plants sure can't touch it.

Posted By: HC HAMMER On: 5/9/2013

Title: NO SHAME IN AEROFRAME

Sounds like what everyone says when they cant hang or get fired or laid off. If you want it your way, then burger king probably has an open position for you. Oh and maybe you can get free food. Then after you have had a long day of cursing the breakfast, lunch, and dinner rushes with little pay, you can go bash them when they hit the news. Piece rate was awesome, besides the fact that it promoted a non training enviroment. Of course it sucks at times, but that is anywhere in the airline industry. Roger didnt cause any of the nonsense that has gone on at Aeroframe. The lack of strong leadership and also the lack thereof of quality employees has been the issue. I have seen more people come in and out of this place because they simply could not hang or handle the pressure. Everyone that has left this place has all the sounded the same way. Whiney and disgruntled because things did not their way. Myself even got furloughed at one point due to a lack of work, but it did not stop them from calling me back. Hard work pays off and Im still getting paid. Good luck out there.

Posted By: brain manual On: 5/8/2013

Title: areoframe abuse of the state tax payers

as a former i know all to well about this scam going on at areo shame. they would make people stay at work even when we had no planes to work on.also you had the piece rate not very good,how ever you could not leave,you would be at work for 60 hours a week and make 92 dollars.only people in the click made any money and that was the mangers,areo-shame put a lot of people in a bind.they got paid with tax payers money for every employee,so who got the money? we did not.people packed up every day,at one time as gov.jindal was talking about how good things are going people are walking out.areo scam even hired instructors from texas and florida. safety was a scam too.

Posted By: Former Employee On: 5/8/2013

Title:

What this article doesn't tell u how Roger Porter constantly stole money by not paying the mechanics for years. He caused good mechanics to leave because they were'nt getting paid for the work they were doing. Which caused him to employ cheap trainees on planes with no proper supervision resulting in damage to aircrafts and him losing cusomers. Porter and his chronies deserve jail time. He has no one to blame but himself.

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