Ala. Senate Passes Tax-Break Bill, Hopes to Woo German Steel Mill

Alabama’s Senate put aside its feuding late Thursday night to pass a package of tax breaks that will keep Alabama in the competition with Louisiana for a German steel mill that will employ 2,700 people.

The Senate voted 34-0 for the legislation, which goes to the governor for signing into law.

“It’s huge,” said Gov. Bob Riley, who negotiated with senators for several hours Thursday.

In Louisiana, the Legislature approved $300 million in infrastructure investments in December. Gov. Kathleen Blanco is asking lawmakers to add another $100 million “to match Alabama’s commitment.”

Key lawmakers said Thursday that partisan bickering, which is increasing on other issues, is being put aside in the Louisiana Legislature when it comes to incentives for the steel mill.

House Republican leader Jim Tucker of Terrytown and Democrat Rep. John Alario of Westwego, the powerful chairman of the House Appropriations Committee, said Thursday that adding the $100 million has wide bipartisan support in both houses of the Louisiana Legislature.

“We have enough on the table,” Tucker said. “We’re in a pretty good position.”

Riley said he expects ThyssenKrupp to pick a plant site May 11. The company is choosing between a site 25 miles north of Mobile and a location in St. James Parish between New Orleans and Baton Rouge. The mill, which would be one of the largest private industrial projects in U.S. history, is expected to support 29,000 construction jobs.

Riley said he had assured ThyssenKrupp officials that the feuding in the Senate was about party politics and had nothing to do with Alabama’s desire to land the $2.9 million mill.

“There was no doubt about the state’s ability to articulate we want you here,” Riley said.

Lt. Gov. Jim Folsom Jr., the Senate’s presiding officer, also negotiated between the Senate’s Democratic majority and Republican minority to get the bill passed.

“We know the importance of this day in Alabama,” Folsom said.

Riley’s tax legislation gives ThyssenKrupp a 10-year tax break on paying utility taxes, an enhanced 20-year break on property taxes that don’t go to education, and an income tax credit for 30 years.

The tax breaks would be added to a $400 million package of economic incentives that the Legislature approved in February.

When Louisiana’s additional $100 million is approved, as legislators predict, the $400 million would be available to build port facilities, expand La. 3125, strengthen the land’s foundation, and ensure the mill has enough power, legislators said.

The steel mill would use about 500 megawatts of electricity, which is enough to light more than 300 typical residences for a month.

If taxpayers fund the upgrades, then Entergy Corp. does not have to include those costs in the formulas used to calculate rates and can subsequently offer a monthly fee closer to what utilities in Alabama can charge, according to the Public Service Commission.

The cost of electricity for industries in Louisiana is much higher – up to $9 million a month more, according to some industrial estimates – than what Alabama utilities can charge for the same of amount of power.

(c) 2007 Advocate; Baton Rouge, La.. Provided by ProQuest Information and Learning. All rights Reserved.