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School board to vote on Areoframe tax credit tonight

Last Modified: Tuesday, May 07, 2013 6:29 AM

By Lance Traweek / American Press By Lance Traweek / American Press

The Calcasieu Parish School Board will decide today whether to renew a $600,000-per-year sales tax credit for Aeroframe Services.

Two weeks ago, the budget committee rejected a request to renew the credit on a phase-out basis.

The committee, which voted 11-2 not to extend the agreement, included all but two board members, who were absent. The sentiment of the committee members opposed to the renewal was that it’s not in the best interest of the system, which faces a $13 million deficit next fiscal year.

The committee will make its recommendation to the full board at its regular meeting at 4:45 p.m. today at 3310 Broad St.

The incentive began in 2003 for EADS before it was bought by Aeroframe. Aeroframe essentially inherited the credit from EADS, benefitting from about $5.4 million in tax credits since December 2005. The arrangement expires at the end of May.

The tax credit, if renewed, would start at $600,000, or 100 percent of $5,000 per employee, and decrease by $120,000, or 20 percent of $5,000 per employee, each year for the next five years. If the phase-out is approved, Aeroframe would receive $1.8 million in tax credits for the five-year period.

Karl Bruchhaus, the school system’s chief financial officer, recommended the committee renew the credit to allow Aeroframe to plan accordingly.

Originally, Bruchhaus said he was going to ask the board not to renew the credit but a compromise was reached with the phase-out agreement.

“It was essentially a start-up credit for that company in that position,” he said.

But Chennault officials and other local representatives recommended a “phase-out,” so Aeroframe can plan when it will expire instead of it being short notice, Bruchhaus said.

Randy Robb, Chennault’s executive director, has said that Aeroframe, which employs 400 people, needs the tax credit because the company is not “in a good position.”Thus, Bruchhaus recommended to the committee to renew it “based on an economic development standpoint.”

The extension was recently approved by the Lake Charles City Council, a move that Mayor Randy Roach called good business.

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