Creating An Orderly Market for Louisiana Tax Credits Transfers
I am very concerned about the market for transferable Louisiana Tax Credits after reading about the problems that members of the New Orleans Saints have had. See Ex-Saint Kevin Houser says tax credit fiasco not his fault.
Louisiana needs a "Tax Credit Exchange." I will propose to the membership of LISTA that they advocate the creation of a non profit corporation (need to check with my tax attorney friends on this concept) to operate a Tax Credit Exchange that would make a market for certified tax credits and various grades of contracts to deliver tax credits at a future date.
The paper work and related contracts would be uniform and the status of the contracts would be verified with the appropriate arm of Louisiana government. If the contract involves little more than a "hope and a prayer" that the person entering into the contract will apply for credits and undertake a creditable business venture in the future, those credits will be deeply discounted and the purchaser will understand that he is purchasing a very speculative contract.
Alternatively if the purchaser decides to buy an existing tax credit that is certified by the state, the value of that credit will be much less significantly discounted. The customers in the market will be better educated about what they are buying, and the process of selling the credits into the market will be orderly and uniform.
I will be reaching out to people with expertise useful in the creation of such a market in the weeks ahead. If you have such expertise and want to help create an orderly market for tax credits in Louisiana, I am looking for your help.
If you think I am making a mistake with this recommendation, I would also like your input. I think we need a more orderly market that discourages the type of problems the New Orleans Saints players have had (but for the grace of god go I), but I want to know what y'all think. I want to start a discussion of the problem. Please write comments on this blog entry and send me email correspondence with your thoughts on this subject.
I am very open to discussion about this subject. Please comment.
