THE LOUISIANA ADVANTAGE: A STATE OF OPPORTUNITIES

Transcription

1 THE LOUISIANA ADVANTAGE: A STATE OF OPPORTUNITIES

2 AGENDA SECTION I: OVERVIEW AND INFRASTRUCTURE SECTION II: INCENTIVES AND CUSTOMIZED SOLUTIONS SECTION III: SUMMARY AND RECENT WINS 2

3 LOUISIANA IS FOCUSED ON BEING A LEADER IN RENEWABLE FUEL AND CHEMICAL INDUSTRIES GOAL Cultivate emerging renewable technologies with an eye toward: Supporting a diversified energy industry Diversifying solutions for energyintensive businesses Leading role in alternative fuel market WHY EXCITING? Louisiana strongly positioned as an ideal site location Incentives and partnership opportunities Need for a diversified energy mix Mandates and consumer demand 3

4 LOUISIANA IS FOCUSED ON EIGHT KEY INDUSTRIES ADVANCED MANUFACTURING AGRIBUSINESS CLEAN-TECH DIGITAL MEDIA AND SOFTWARE ENERGY ENTERTAINMENT SPECIALTY HEALTH CARE WATER MANAGEMENT 4

5 LOUISIANA HAS ONE OF THE MOST COMPETITIVE BUSINESS CLIMATES AND OFFERS SEVERAL DISTINCT ADVANTAGES BUSINESS FRIENDLINESS BEST WORKFORCE TRAINING LOW OVERALL COSTS LOW TAXES ROBUST TRANSPORTATION OPTIONS FAST, FLEXIBLE INCENTIVES CUSTOMIZED SOLUTIONS AND DIVERSITY FOR BIOPROCESSING 5

6 No.1 NO. 1 IN THE NATION FOR ECONOMIC GROWTH POTENTIAL Business Facilities magazine (2011) No.3 NO. 3 FOR STATES THAT ARE LEADING THE ECONOMIC RECOVERY Area Development magazine (2011) No.1 LOUISIANA ECONOMIC DEVELOPMENT RANKED THE NO. 1 STATE ECONOMIC DEVELOPMENT AGENCY IN THE COUNTRY Site Selection magazine (2011) 6

7 LED FASTSTART NAMED THE NO. 1 WORKFORCE TRAINING PROGRAM IN THE COUNTRY # Business Facilities magazine, 2010 & 2011,

8 LED FASTSTART PROVIDES A DISTINCTIVE SOLUTION LED FASTSTART PROVIDES CUSTOMIZED EMPLOYEE RECRUITMENT, SCREENING, TRAINING DEVELOPMENT AND TRAINING DELIVERY FOR ELIGIBLE, NEW OR EXPANDING COMPANIES ALL AT NO COST. ANALYZE LED FastStart's team pairs with the company's subject matter experts at any location in the world mirroring the new operations. If the company has a unique process, FastStart will work with the R&D and engineering departments to gather the necessary critical data. ATTRACT After a complete analysis of the company, FastStart determines the competencies that match the cultural and technical abilities that will help define the most successful employee. EVALUATE Critical data is collected for each applicant through behavioral interviews, pre-employment training, hands-on simulations and more. Evaluations are scored and sorted, allowing the company to select the best candidates. TRAIN Training programs are sequenced and delivered to engage new employees. 8

9 LOUISIANA HAS LOWER OVERALL BUSINESS COSTS THAN THE SOUTHEAST AND U.S. Overall business cost index (U.S. baseline = 100) The overall results combine all operations, including manufacturing and non-manufacturing Source: KPMG Competitive Alternatives 9

10 A NEW TAX FOUNDATION/KPMG STUDY SHOWS LOUISIANA OFFERS A VERY COMPETITIVE BUSINESS TAX STRUCTURE LOUISIANA ACHIEVED TOP RANKINGS FOR HAVING SOME OF THE LOWEST STATE-AND-LOCAL TAX BURDENS ACROSS SEVERAL CATEGORIES OF NEW FIRMS CAPITAL-INTENSIVE MANUFACTURING LABOR-INTENSIVE MANUFACTURING R&D FACILITY CORPORATE HEADQUARTERS ALABAMA ARKANSAS FLORIDA GEORGIA LOUISIANA MISSISSIPPI NORTH CAROLINA OKLAHOMA SOUTH CAROLINA TENNESSEE TEXAS VIRGINIA Location Matters: A Comparative Analysis of State Tax Costs on Business,

11 LOUISIANA S STRATEGIC LOCATION MEANS COST EFFECTIVE TRANSPORTATION OPTIONS UNSURPASSED CAPABILITY With seven commercial service/primary airports, an international airport, six major interstate highways, and the world s largest port complex, Louisiana s transportation access is second to none. TOP U.S. PORT The Port of South Louisiana is the largest single port in the nation (measured by tonnage). KING OF THE RAIL Louisiana is one of only two states in the nation where all six of North America s class one railroads converge. 11

12 ROBUST TRANSPORTATION INFRASTRUCTURE OFFERS DIVERSE ALTERNATIVES 12

13 A DIVERSE PORTFOLIO OF FEEDSTOCK SUPPORTS PROCESSING AND TRANSPORT OF BIO-DERIVED COMMODITIES Forestry Sugar Rice Corn Sorghum PRIMARY CROPS Potatoes Vegetables Cotton Oilseeds Nuts Beans Wheat Fruit Grasses 13

14 RESEARCH STATIONS LOCATED THROUGHOUT THE STATE OFFER STRATEGIC PARTNERSHIP OPPORTUNITIES 14

15 LSU AGCENTER OFFERS EXPERTISE ON BIOMASS FEEDSTOCK DEVELOPMENT AND CONVERSION TECHNOLOGIES Research Facilities Audubon Sugar Institute School of Plant, Environmental & Soil Sciences Hill Farm Research Station Iberia Research Station Department of Biological & Agricultural Engineering Cellulosic ethanol production Second generation biofuels Research Focus Alternative biodiesel feedstock crops (winter cover crops as well as alternative tree species) Switchgrass Multi-unit sweet sorghum Microwave technology in biodiesel production Gasification of biomass feedstock Ethanol production from algae LSU AgCenter Biotechnology Laboratory Microalgae for hydrogen production School of Renewable Natural Resources Hydrothermal processing of biomass Calhoun Research Station Wood/other biomass conversion into liquid and gaseous products Callegari Environmental Center Department of Agricultural Economics & Agribusiness Quality characteristics of biodiesel production Alternative biomass feedstock crops Alternative biofuel production methods 15

16 ULL IS CONDUCTING BIOPROCESSING RESEARCH PROJECTS IN PARTNERSHIP WITH PRIVATE COMPANIES Research Biomass-Fed Fluidized Bed Gasifier NorthStar & CLECO Partnership Algae to Fuels Aquatic Energy Torrefaction CLECO & V-CAP Group Biogas Digestion Eagle Green Energy & CLECO Chemicals from DDG Evergreen LLC Biogas from Algal Cake MarTek Bioscience Glycerin to Propane Diols Terra Chemicals Sewage Sludge to Fuels MSU Tall Oil to Green Diesel Boise Solar Thermal/Gasification Integration Poche, Pruit, and Associates & CLECO 16

17 LOUISIANA IS SUCCESSFULLY LEVERAGING ASSETS TO ATTRACT EMERGING INDUSTRIES Diverse agricultural and energy production/refining capabilities. Fast track permitting and regulatory environment. Extensive infrastructure and workforce for cost effective production. Robust incentives to further our success in building the industry. Industry leaders have made significant investments in Louisiana including: 17

18 AGENDA SECTION I: OVERVIEW AND INFRASTRUCTURE SECTION II: INCENTIVES AND CUSTOMIZED SOLUTIONS SECTION III: SUMMARY AND RECENT WINS 18

19 LOUISIANA WILL PARTNER WITH YOU TO TAILOR A SOLUTION THAT MEETS YOUR SPECIFIC NEEDS Industrial Tax Exemption Provides a 100% property tax abatement for up to 10 years on materials and equipment used in new manufacturing. Quality Jobs 1 Provides up to 15% rebate on annual payroll expenses for up to 10 years; and either a 4% sales/use tax rebate on capital expenditures or an investment tax credit equal to 1.5% of qualifying expenses. Research and Development Tax Credit Provides a tax credit up to 40% to existing businesses with operating facilities in Louisiana to establish or continue research and development activities within the state. FastStart Provides customized workforce program: recruitment, screening, training. Cooperative Endeavor Agreement Provides discretionary funding support for infrastructure and plant capital expenditures. 19

20 HYPOTHETICAL MODEL: COMMERCIAL SCALE FACILITY BioProcessing Company is seeking to establish a commercial scale facility in Louisiana. LED s assumptions include the following: Company feels 160 employees and $300,000,000 in Capex will adequately meet its business expansion objectives. Average annual blended salary for employees is estimated at $79,100 per year in Louisiana. Company will relocate 10 critical employees from outside Louisiana to ensure effective start-up and ongoing operations. Company will produce 75 million gallons of a bio-derived commodity on an annual basis. 1 Source: National Biodiesel Board Comprehensive Study on Energy Use for Biodiesel Production 20

21 LOUISIANA OFFERS SIGNIFICANT OPERATIONAL COST SAVINGS IMPROVING BOTTOM LINE CONTRIBUTIONS Annual Salary 160 Employees 1 $14,014,000 $14,823,000 Annual Natural Gas 2 $109,282,000 $84,612,000 $12,656,000 $67,793,000 Louisiana Southeast U.S. Average U.S. Average Louisiana Southeast U.S. Average U.S. Average Annual Electricity 2 Annual Louisiana Savings 3 $594,000 $933,000 $990,000 Louisiana 19.3% Savings U.S. Cost Louisiana Southeast U.S. Average U.S. Average 1 Source: Wage Rate - EMSI Complete Employment, 2010 median SOC code (General and operations managers). 2 Source: U.S. Energy Information Administration: Natural Gas & Electricity, Retail Sales of Electricity to Ultimate Customers by End-Use Sector, by State, Louisiana annual wage, electricity, and natural gas expenses as a percentage of U.S. average. 21

22 LOUISIANA S LOW COST BUSINESS ENVIRONMENT AND INCENTIVES WILL IMPROVE COMPANY S PROFITABILITY $17,504,000 $3,377,900 $143,470,000 $61,850,000 $1,292,812,000 Total NPV of Louisiana Cost Savings 1 $226,201,900 (17.5%) $1,066,610,100 Total U.S. Project Cost Wage Savings (1.35%) Electricity Savings (0.26) Natural Gas Savings (10.1%) Incentive Package (4.78%) Total Louisiana Project Cost 1 Total U.S. project cost is the 10 year sum of wages, electricity, natural gas, and startup capital expenses discounted at a yearly 3% rate 22 22

23 AGENDA SECTION I: OVERVIEW AND INFRASTRUCTURE SECTION II: INCENTIVES AND CUSTOMIZED SOLUTIONS SECTION III: SUMMARY AND RECENT WINS 23

24 LOUISIANA S PRO-BUSINESS CLIMATE AND CUSTOMIZED SOLUTIONS WILL SUPPORT COST EFFECTIVE GROWTH 1. Significantly lower ongoing cost 2. Low cost facility Lower wage levels; competitive tax structure; incentives Louisiana contributes towards a percentage of annual lease payments as long as jobs/payroll are delivered and maintained 3. Relocation/transition assistance 4. Complete workforce support Relocation costs covered for key personnel Significant labor pool with strong qualifications and work ethic Network of 2 and 4 year institutions, including nationally recognized LSU, ULL and Tulane Comprehensive, customized hiring/training support during ramp-up (LED FastStart ) 5. Business development assistance Louisiana will tailor a solution that meets specific business development needs and minimizes project risk 24

25 CONTACT KYLE ZERINGUE Director, Business Development Louisiana Economic Development

26 26

27 27

28 28

29

30

31