Kingfish — Taxes

What is a PILOT? The tax deal you've never voted on

Bentley Hensel — Wed, 22 Jul 2026 13:18:00 GMT

If ITEP is Louisiana's famous tax break — the one with a state database, a fixed percentage, and decades of public argument — the PILOT is its quieter cousin. Fewer rules. Less paperwork in public view. And, done a certain way, a bigger break than ITEP could ever grant.

PILOT stands for Payment In Lieu Of Taxes. The name says it plainly: instead of paying property taxes the normal way, a company pays a negotiated amount — sometimes more than nothing, usually less than the full bill — under a contract with a local public body.

The short version

In a typical Louisiana PILOT, a public industrial development board takes legal title to the project property and leases it back to the company.
Because government-owned property is exempt from property taxes, the normal tax bill disappears. The company's negotiated payments replace it.
Unlike ITEP, there's no fixed percentage and no standard term. Everything — amount, schedule, escalation, duration — is whatever the parties agree to.
PILOTs are legal, common, and sometimes genuinely good deals for a community. They are also negotiated, which means the public's protection is entirely in who negotiated, what they got, and whether anyone can see the paperwork.

How the structure works

Louisiana law — the industrial development board statutes, La. R.S. 51:1151 and following — lets parishes and municipalities create nonprofit public corporations whose whole purpose is financing industrial projects. Here's the standard play, step by step:

The company and the industrial development board (IDB) strike a deal, often alongside a bond issue the board sponsors.
The IDB takes title to the land, buildings, or equipment. The company leases it all back and operates exactly as it would have anyway.
Because the property is now publicly owned, it comes off the tax rolls — not 80 percent off, like ITEP's current cap. All the way off.
The company makes the agreed PILOT payments, which are divided among local bodies according to the deal.
At the end of the term, title typically returns to the company and the property rejoins the rolls — depending, as always, on what the contract says.

When bonds are involved, the deal generally needs sign-off from the State Bond Commission, whose monthly agendas are public and are one of the best early-warning systems for PILOT deals anywhere in the state.

PILOT vs. ITEP, side by side

	ITEP	PILOT
Who grants it	State Board of Commerce & Industry + governor, with a parish board hearing	Local industrial development board and parish bodies
How much	Fixed by rule: up to 80% off, up to 10 years	Whatever's negotiated — can exceed or undercut ITEP
How long	5 years + 5-year renewal	Any term the contract sets — can run decades
Where to find it	State's FastLane database	Local minutes, lease agreements, Bond Commission agendas
Public's role	Parish board public hearing required	Whatever local process the bodies choose to hold

The practical difference: ITEP is a program with statewide rules you can look up. A PILOT is a contract, and every one is different. That cuts both ways. A well-negotiated PILOT can deliver a community-guaranteed payment on day one — something ITEP's exemption never does. A badly negotiated one can quietly give away more than ITEP ever could, for longer, with fewer people noticing.

Why this matters in central Louisiana right now

Two live projects put PILOTs on the local map.

First, the Applied Digital data center project near Boyce — the $3.6 billion Delta Forge campus — is taking the PILOT route rather than ITEP. Its deal runs through the England Authority, which, in February 2026, created a special subdistrict around the 672-acre site that Applied Digital had bought that December. Under an early term sheet, the company's payments fall over time — starting near $27.4 million and dropping to about $19.4 million by year 25, KALB found in a review of the documents. A declining schedule on a growing facility is exactly the kind of thing the checklist below is built to catch.

Second, the proposed Sunstripe Solar project — 10,356 acres near Hineston — hasn't declared its intentions. But the Rapides Parish Police Jury anticipated the question: Section 26-13 of the parish's Solar Farm Ordinance reserves the jury's right to accept, reject, or modify any ITEP request — and then states, in the same breath, that the ordinance "does not limit the use of a PILOT." The door is open. As of mid-July, no ITEP filing for the project appears in the state database, which makes the PILOT question a live one.

The questions to ask about any PILOT

When a PILOT lands on a local agenda — and one eventually will — these are the questions that separate a good deal from an expensive one. We'll be asking them; you can too.

What would full taxes have been? A PILOT can only be judged against the counterfactual. Demand the assessor's math, not the company's.
Who negotiated, and who was in the room? Was the school board at the table, or just informed afterward?
How is the money split among the parish, schools, sheriff, and fire districts — and does the split match what their millages would have collected?
Does the payment escalate with inflation or assessed value, or is Year 25's check the same as Year 1's?
What are the clawbacks if the company underbuilds, sells, or leaves early?
Who audits the payments, and where does the agreement itself get filed so the public can read it?

Where to find PILOTs before they're done deals

PILOTs rarely announce themselves. They surface in: industrial development board and police jury agendas and minutes (Kingfish archives Rapides Parish's here); State Bond Commission monthly agendas; and the conveyance records at the clerk of court, where the title transfers and leases that make the structure work have to be recorded. If you see a public board suddenly "acquiring" an industrial property, it will never operate — that's usually not a purchase. That's a PILOT being born.

What is ITEP? Louisiana's biggest tax break, explained

Bentley Hensel — Tue, 21 Jul 2026 12:25:41 GMT

Property taxes in Louisiana are local money. They fund the school district, the sheriff, the fire district, the library, the roads. The state doesn't collect them.

But for almost 90 years, the state has had the power to give them away.

That power is the Industrial Tax Exemption Program — ITEP — and if you follow big projects in this parish, you will run into the acronym constantly. This explainer covers what it is, how it changed in 2024, who decides, who pays, and how to look any application up yourself.

The short version

ITEP lets the state exempt a manufacturing project's new buildings and equipment from local property taxes — currently up to 80 percent, for up to 10 years.
The exemption is granted by the state Board of Commerce and Industry with the governor's approval — but the revenue it erases belongs entirely to local governments.
Since 1998, Louisiana has awarded more than $20 billion in local tax breaks through the program.
The rules changed in February 2024: job-creation requirements are gone, and the separate local votes by school boards and sheriffs were replaced with a single parish board vote.
Every application is public. You can look them up in the state's FastLane database.

How it works

ITEP is written into the Louisiana Constitution — Article VII, Section 21(F). It authorizes the Board of Commerce and Industry, with the governor's sign-off, to grant a "manufacturing establishment" a contract exempting its new capital investment — buildings, machinery, equipment — from ad valorem property taxes. Contracts run five years, renewable for five more.

Two features make Louisiana's version unusual among states. First, the decision is made at the state level, but the cost lands entirely at the local level — the state is spending someone else's money. Second, for roughly 80 years, the locals whose money it was had no say at all. Exemptions were near-automatic, at 100 percent.

Three eras of ITEP

Before 2016: automatic and total. For decades, exemptions were routinely granted at 100 percent with no local input. Research by the church-and-community coalition Together Louisiana found that in one year local governments across sixty parishes were forgoing about $1.9 billion annually, with public schools the hardest hit — roughly $720 million in 2017, a meaningful share of all school funding.

2016–2024: locals get a vote. Gov. John Bel Edwards' 2016 executive order cut the exemption to 80 percent, added job-creation requirements, and — the big one — required each local taxing body (the police jury, school board, sheriff) to approve or reject its own share. Locals mostly said yes: about 96 percent of projects won at least partial approval. But the reform mattered anyway — one analysis cited by the Louisiana Illuminator put the added local revenue at roughly $260 million per year. An attempt to write local control into the constitution failed in the state Senate in 2022, which left the whole arrangement resting on executive orders — changeable by the next governor. Which brings us to:

2024–present: the Landry rules. On February 21, 2024, Gov. Jeff Landry signed Executive Order JML 24-23, which governs ITEP advances filed since that date. The current rules:

The exemption stays capped at 80 percent for the initial five-year contract and the renewal.
Job-creation requirements are eliminated. "This program is about capital investment. It is not about job creation," Landry said when he signed the order.
The separate votes by the police jury, school board, and sheriff are consolidated into a single parish industrial board with representatives of those bodies. One up-or-down vote applies to everyone's taxes — no more partial approvals where the school board says no but the sheriff says yes.
The sequence: the state Board of Commerce and Industry acts first; if it approves, the parish board must hold a public hearing within 45 days. Ultimate authority runs through the governor.

Whether that consolidated local vote is a meaningful check or a formality is one of the open questions of the current era — and one Kingfish will be watching in real time if a big application lands here.

Why you're reading this now

Kingfish is covering the proposed Sunstripe Solar project — 10,356 acres near Hineston — and the question of whether its developer will seek ITEP is one of the biggest unanswered questions about the project's local impact.

Two facts so far. First, as of a mid-July search of the state's FastLane database, no ITEP filing exists for Treaty Oak Clean Energy, TO LA Solar 1, or any Sunstripe-related entity in Rapides or Vernon parish. Second, Rapides Parish saw this question coming: Section 26-13 of the parish's Solar Farm Ordinance, adopted in June 2025, explicitly reserves the Police Jury's right "to accept, reject, or request modification" of any ITEP for a solar project — while leaving the door open to a negotiated alternative called a PILOT. (We've explained PILOTs separately; the short version is that it's a substitute deal, not an exemption.)

How much money is actually at stake depends on assessed values and local millage rates, and we won't pretend to know those numbers before an application exists. When one does, we'll run the math and show our work.

How to look it up yourself

FastLane — Louisiana Economic Development's public project database. Search by company name, parish, or program ("ITE"). Advance notifications appear here before contracts are approved.
Board of Commerce and Industry agendas — posted by Louisiana Economic Development; this is where state approval happens.
Parish industrial board hearings — under the 2024 rules, the local hearing must happen within 45 days of state board approval. Watch the Police Jury's meeting calendar and agendas.

The debate

Supporters — including the state's major business lobby, on whose stage the 2024 order was signed — argue ITEP is Louisiana's most important tool for landing capital-intensive industry, and that without it projects go to Texas or Mississippi. Critics — led by Together Louisiana, whose research drove the 2016 reforms — argue the program hands out money that belongs to schools and local services, often for investments that would have happened anyway, and that no one at the state level has ever seriously tested that question.

Both sides agree on one thing: the dollars are enormous. Which is exactly why every application deserves a public paper trail — and why we'll link one every time.