Emerson campus demands lower tax rate
GONZALES — The owner of land in Ascension Parish designated to become the home of an Emerson Process Management regional campus said he is concerned that a sales tax dispute might send the Fortune 500 company elsewhere.
Nolan “Sonny” Lamendola, who has an agreement to sell 18 acres of a 75-acre tract of land on West Orice Roth near Veterans Boulevard to Emerson, said the development is being held up because the city of Gonzales and Ascension Parish governments have not yet reached a deal to lower Emerson’s annual sales tax payments.
The parish receives 2 percent of sales taxes on commercial property in the parish, with a half-percent of that earmarked to go to the Ascension Parish Sheriff’s Office. It also has an ordinance enacted May 7, 2009, that states it would retain 75 percent of its proceeds with the municipality receiving 25 percent of any future property that was annexed into a municipality. All proceeds from previously annexed property were split 50-50 between the parish and municipality.
Gwen LeBlanc, the chief financial officer for Ascension Parish government, said the parish adopted that ordinance to protect its tax base from further erosion. The Emerson project is one of the first ones to fall under the ordinance since its passage.
The city of Gonzales annexed Lamendola’s property in order to provide Emerson with sewer services, Gonzales City Clerk Clay Stafford said.
When adding the city’s 2 percent sales tax, Emerson would be charged a sales tax rate of 10.5 percent instead of the 8.5 percent collected elsewhere in the city and parish. In addition to the 4 percent sales tax that applies to the parish and city of Gonzales, the state gets 4 percent, the Ascension Parish School Board gets 2 percent and the parish’s drainage district receives another half of a percent.
Government officials have been trying to craft a compromise that would allow 2 percent to be shaved off Emerson’s annual tax bill, but have yet to work out a deal — which leaves Lamendola both frustrated and concerned.
“If Emerson can’t get what they want and they keep putting the sale of this thing off, Emerson is in the business to do business,” Lamendola said. “If there’s something stopping them from doing business, they’re going to go somewhere else. They aren’t playing games.”
Emerson, which has been in Ascension Parish for 40 years, is planning to build a $10 million expansion on Lamendola’s property that would be used to consolidate six of its operations or subsidiaries, including two elsewhere in the parish. The campus also would include a regional headquarters for Instrument and Valve Services, one of the company’s subsidiaries.
The project is expected to bring 180 jobs to Gonzales, including 50 new ones, and the campus would employ personnel with an annual payroll of around $9.2 million.
Emerson’s project manager, Marlin Wilson, said Emerson “took the long road purposefully” and isn’t particularly interested in leaving the parish, despite the deal currently being held in limbo.
He said officials in Baton Rouge offered a “really attractive package” to entice Emerson out of Ascension Parish, but from the time they started looking into the regional campus, Emerson officials “thought the right thing to do was to remain in Ascension Parish,” Wilson said.
Lamendola still owns the property, which is at the heart of a lawsuit attempting to overturn its rezoning from residential to commercial and prevent Emerson from locating there. As a result, Lamendola said, Emerson officials are “getting a little impatient” and hope the sales tax issue is settled soon.
“We’re really hanging out there waiting for a decision to be made by someone else,” Lamendola said.
Parish and city officials have said they are working on a plan that would have the parish, city and Sheriff’s Office each forgo half of their sales tax revenue. The city would give back 1 percent, the parish 0.75 percent and the Sheriff’s Office 0.25 percent — allowing Emerson to be taxed at a rate of 8.5 percent, rather than 10.5 percent.
Ascension Parish President Tommy Martinez said he believes all sides can work together to reach a compromise to satisfy everyone.
“I can certainly support working with bringing a new company into Ascension Parish, whether it be in the city or the parish,” Martinez said.
Sheriff Jeff Wiley said he’d had informal discussions with city officials about Emerson and that he was “approachable on that arrangement.”
“I want to be part of resolving that,” Wiley said.
Martinez said that while he supports the Emerson project, he doesn’t have a vote and can’t speak for council members. The council would have to pass a new ordinance to forgo some of its sales tax collections, and that would start at the council’s Finance Committee, he said.
Teri Casso, the Finance Committee chairwoman, said progress is being made on the issue, but it likely would be another five or six weeks before any deal is finalized.
Casso met with Martinez and other parish officials, including Council Chairman Chris Loar, “to develop the best strategy to move forward.”
The next Finance Committee meeting will be held on Monday, but the sales tax discussion is not on the agenda. The next committee meeting would likely be held Oct. 1, though it hasn’t been scheduled yet.
Although parish and city officials are discussing the issue, there’s no guarantee that the agreement would receive council approval. Stafford said he didn’t think the city’s council members would balk at the deal.
“We certainly want Emerson to be in Ascension Parish and want to work this out,” Casso said. “I think we can. We just have to develop the right strategy.”
Wilson admitted that “a great many things have to happen” for Emerson’s expansion project to come to fruition. However, he doesn’t see either the lawsuit or the sales tax issue stopping the development.
“I have faith in the people and the process,” Wilson said.
Advocate staff writer
David J. Mitchell contributed to this report.