Louisiana Administrative Code
Title 61 - REVENUE AND TAXATION
Part I - Taxes Collected and Administered by the Secretary of Revenue
Chapter 16 - Louisiana Entertainment Industry Tax Credit Programs
Subchapter D - Musical and Theatrical Production Income Tax Credit Program
Section I-1698 - Certification Procedures-Infrastructure [Formerly Section 1697]

Universal Citation: LA Admin Code I-1698

Current through Register Vol. 50, No. 9, September 20, 2024

A. Qualification of the Infrastructure Project

1. Tax credits may be granted only for:
a. infrastructure projects directly related to the production or performance of musical or theatrical productions;

b. equipment, movable and immovable property related thereto; and

c. any other facility which supports and is a necessary component of such a facility.

2. The department shall determine which projects are "directly related" to the production or performance of musical or theatrical productions, taking into consideration all relevant factors such as; the frequency of performances, the configuration of stage and seating, and the presence of specialized lighting and/or sound equipment.

3. The department shall determine whether a facility "supports" or is a "necessary component" of a state certified infrastructure project. Examples of qualifying facilities would be a parking garage, gift shop or costume storage. Examples of non-qualifying facilities would be restaurants, bars, hotels, golf courses and shopping centers.

4. The department shall determine whether a facility is a "multi-purpose" infrastructure project, taking into consideration relevant factors such as the frequency of musical or theatrical productions; the configurations and permanence of stage and seating; the percentage of square footage allocated to live performance versus total building square footage; the booking agent or management companys professional experience; applicants ability to document ticket sales through an on-line event ticketing site or on-site box office and any other factors deemed relevant by LED.
a. Upon a determination of qualification as a multipurpose infrastructure project, the applicant may be subject to the following additional restrictions, which shall be set forth in the initial certification.
i. Only expenditures directly related to a live musical or theatrical performance in Louisiana are eligible for tax credits and any expenditures unrelated to such productions shall be excluded. In calculating the estimated amount of qualifying versus non-qualifying expenditures, LED will select the methodology it deems most appropriate under the circumstances.

ii. Tax credits may be subject to a structured release over the course of two to five years.

iii. State certification of a multi-purpose facility project is conditioned upon continued primary use for live performance productions for a period of at least two calendar years from date of project completion.
(a). Evidence of Compliance. Applicant shall provide annual reports to LED for two calendar years, verifying continued use primarily as a live performance production facility, which may include but not be limited to financial statements reflecting total ticket sales, food and beverage revenue, alcohol sales, and a detailed report of live performance productions held.

(b). Default. In the event applicant fails to comply with the continued use requirements during any of the specified years, applicant shall forfeit all unreleased tax credits (for the year in which it failed to comply and all future years).

iv. For the purposes of this section, entertainment typically performed in bars subject to a "cover charge" and non-traditional entertainment such as balloon artists, quiz shows and casting calls will not be considered a qualifying live performance production.

B. Duration of Tax Credit

1. Tax credits may be granted under R.S. 47:6034 until January 1, 2014.

C. Amount of and Limitations upon Tax Credit

1. If the total base investment is more than $100,000, but less than $300,000, a tax credit of 10 percent applies.

2. If the total base investment is more than $300,000, but less than $1,000,000, a tax credit of 20 percent applies.

3. If the total base investment is more than $1,000,000, a tax credit of 25 percent applies.

4. No more than $10,000,000 may be granted per state certified infrastructure project.

5. No more than $60,000,000 may be granted, per year, for a ll state certified infrastructure projects.
a. Tax credits shall be available on a first come, first served basis, based upon date of final certification and qualification of expenditures. If the total amount of credits applied for in any particular year exceeds the aggregate amount of tax credits allowed for that year, the excess shall be treated as having been applied for on the first day of the subsequent year.

b. Fifty percent of the tax credits annually granted for infrastructure projects shall be reserved for projects located outside of Jefferson and Orleans parishes, provided that the availability of tax credits for infrastructure projects in Jefferson and Orleans parishes shall not be conditioned upon the granting of infrastructure tax credits for projects outside of those parishes.

D. Earning of Tax Credits

1. Construction of the infrastructure project shall begin within six months of the date of initial certification.

2. Credits are earned when qualified expenditures receive final certification.

3. An infrastructure project may submit multiple requests for final certification, however;
a. 25 percent of the total base investment must be expended before requesting the first certification of qualified expenditures;

b. 50 percent of the total base investment must be expended within two years of the date of initial certification;

c. In the case of multiple use facilities, no tax credits will be earned until the facility directly used in the theatrical or musical productions is complete.

4. Tax credits associated with a state-certified infrastructure project shall never exceed the total base investment and transportation expenditures.

E. Infrastructure Program Sunset Limitations

1. The final day that LED may grant tax credits under the infrastructure program is January 1, 2014.

2. In order to allow LED sufficient time prior to that date to verify project completion requirements and validate qualifying expenditures, LED recommends that state-certified infrastructure project applicants submit any requests for final certification of tax credits, with required cost report, to LED no later than August 1, 2013. LED shall make best efforts to timely process any requests received after this date.

3. In the event that either the program caps or geographic caps listed above are met for the calendar year 2013, LED shall publish notice on its website www.LouisianaEntertainment.gov and send out written notice to infrastructure applicants, advising them of cap fulfillment. Whereas excess expenditures are treated as having been applied on the first day of the subsequent year, and tax credits may not be awarded for 2014 expenditures, any 2013 excess expenditures will be considered nonqualifying.

AUTHORITY NOTE: Promulgated in accordance with R.S. 47:6034(E).

Disclaimer: These regulations may not be the most recent version. Louisiana may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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