Beauregard School Board rejects ITEP applications

The Beauregard Parish School Board rejected renewals for three different Industrial Tax Exemptions at a meeting this week.

The three ITEP renewals were for the Packing Corporation of America DeRidder Containerboard Mill in DeRidder. The facility employs 562 and has been operational for over 60 years, said John Lee, tax director, PCA, at the BPSB committee meeting on Monday.

All three renewals were for three years at an 80 percent exemption. For the first five years, the ITEP was for 100 percent. The three exemptions that were denied would have accounted for about $200,000 annually over the next three years, he said.

One renewal was for the purchase and installation of a shoe press for the Mill’s number three paper machine. One was for a new dilution profile control headbox on the number three machine. Another was for upgrades to the paper machines. These were the last major upgrades made to the number three paper machine, and were conducted in the 2018 to 2019 time frame, said Hillary Wolf, mill controller, DeRidder Containerboard Mill.

At the agenda meeting, Lee explained that the ITEP program allows businesses to “make the capital investment” to “stay competitive and retain well-paying jobs” while creating a “permanent tax base” for the school board and parish after the exemption expires.

Annually, the mill pays about $7 million in property tax, he said, and the three exemptions that were denied would have accounted for about $200,000 annually over the next three years, he said. According to the ITEP applications, the total investment of the three projects was about $26.5 million.

While PCA did not anticipate the projects to create new jobs, 10 jobs were added during that time, he said.

“A lot of these were meant for job retention. It’s to keep those machines running so we can keep these jobs,” said Wolf.

Lee noted the projects are also economically stimulating.

“Anytime we spend this kind of money, it brings in contractors from out of town into the local jurisdiction,” he said. “They’ll stay at the hotels. eat at the restaurants, it’s good for the local economy.”

Ray Bowman, District 4B, said he was concerned over a previous overpayment of sales tax money to PCA at the Monday meeting.

“I’ve always thought well of your company until a few years ago, and it really had to do with, what I believe was somewhat of a lookback in your tax system that triggered this board having to pay a significant amount of money back to you that had already been pushed back out and been spent.”

On September 16, 2017, the American Press reported that BPSB had to repay over $600,000 in sales tax revenue to PCA in increments of $35,826.53 over 18 months.

“Normally I would support this 100 percent, yay, but that was a lot of money, and I just don’t want that to happen again,” he said.

Wolf said the error was made because of a system that was not calculating taxes correctly, and that PCA now uses a “home-built system” that reviews every purchase order individually to ensure they are taxed correctly.

“It’s a completely different process because it’s a completely different system.”

At the board meeting on Thursday, the ITEP renewal for the shoe press was denied with a vote of four to four, with Jared Kibodeaux, District 4A, Kristi Neely, District 2, Scott Sandifer, District 1 and Nikki Weldon, District 5 in opposition.

The other two ITEP renewals were denied with a vote of four to five, with Carlos Archield, District 3A, Kibodeaux, Neely, Sandifer and Weldon in opposition.

These renewals were approved by the Beauregard Parish Police Jury in May, according to BPPJ meeting minutes.

In July, the board unanimously approved a different ITEP for PCA for a project that included additions to the mill’s lime kiln.

Board Vice-President Bryan Redler, District 3D, was not present for the meeting.

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