State board exempts Folgers from paying taxes to New Orleans schools

FILE - In this June 4, 2008 file photo, containers of Folgers instant coffee are seen on a...
FILE - In this June 4, 2008 file photo, containers of Folgers instant coffee are seen on a supermarket shelf in Norwood, Mass. (AP Photo/Steven Senne, file)(Steven Senne | ASSOCIATED PRESS)
Published: Mar. 2, 2023 at 12:55 PM CST
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A state board has overturned the decisions of three New Orleans taxing authorities that sought to collect millions in property taxes from Folgers Coffee Co. Wednesday’s vote from the Louisiana Board of Commerce and Industry, composed of business group representatives and governor’s appointees, is the latest development in a saga that has spanned more than two years.

Folgers had filed six applications for the state’s Industrial Tax Exemption Program (ITEP) for upgrades it completed at its Chef Menteur Highway and Old Gentilly Road plants. The company sought tax breaks covering an entire decade on top of the roughly $121 million in exemptions it had already received from 2000 to 2017.

Local residents and advocacy groups lobbied heavily against the tax breaks until all three local taxing bodies — the New Orleans City Council, Orleans Parish Sheriff’s Office and Orleans Parish School Board — denied all six of Folgers’ applications.

New Orleans officials then sent Folgers a $5.1 million bill for the unpaid back and current taxes. In response, Folgers filed a lawsuit and successfully convinced a judge to halt the tax bill and allow the company to appeal to the Board of Commerce and Industry for a new decision on its ITEP applications.

In a split decision, the board approved all six of Folgers’ exemptions for school board taxes and two of its exemptions for the city taxes.

Together Louisiana, one of the advocacy groups that has opposed Folgers’ ITEP applications, released a statement saying the decision to single out New Orleans public schools for punishment was “particularly arbitrary and cruel.”

“A majority of this unelected Board, however, think they know better about the interests of our community than its elected representatives. They don’t,” Together Louisiana said. “We will not achieve our true potential as a state until the Board of Commerce and Industry stops giving away millions in taxpayer dollars without the consent of local communities. It’s corporate welfare at its least accountable, and it should stop.”

One board member who spoke out against the decision, Louisiana Economic Development (LED) Secretary Don Pierson, warned his fellow board members about wrestling taxation power away from local governments.

“We can’t micromanage into 64 parishes,” Pierson said.

Wednesday’s decision is not the final stop. Gov. John Bel Edwards has to sign off on the commerce board’s decision, and his spokesperson Eric Holl said the applications will still need to go through LED before the governor receives them.

The J.M. Smucker Co., the parent company of Folgers, thanked the board in an email to the Illuminator.

“We appreciate the Louisiana Board of Commerce and Industry for hearing our appeal and its consideration of this matter,” a company spokesperson said. “As we have throughout this process, our focus remains on delivering for the consumers who count on our brands and supporting the local community we are so proud to be part of.”

Louisiana Illuminator is part of States Newsroom, a network of news bureaus supported by grants and a coalition of donors as a 501c(3) public charity. Louisiana Illuminator maintains editorial independence. Contact Editor Greg LaRose for questions: Follow Louisiana Illuminator on Facebook and Twitter.

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