Acadia Parish power plant property tax issue settled

The work “Jimbo” Petitjean, Acadia Parish assessor, put into a two-year fight with Bayou Cove Peaking Power, LLC, over what the parish was owed was no short feat.
“We have just settled a huge case for Acadia Parish,” said Petitjean as he explained the situation to the Acadia Parish School Board Monday.
“When I first started as assessor in 2013, we had a couple of power plants coming off of 10-year exemptions.”
The first was the CLECO/Calpine plant situated in the northern part of the parish. It is a public utility facility and is valued by the Louisiana Tax Commission.
The second is in the Evangeline area and is owned by NRG. Just to the east of that facility is a substation owned by Entergy.
In Louisiana, the cost approach is used in valuing commercial property, Petitjean explained. In other words, if it cost you $100, it’s valued at $100.
A depreciation table is used with guidelines to determine the value of the property.
In 2013, the parish began what would become a battle. Under its valuation breakdown, it assessed the value of Bayou Cove Peaking Power’s property at more than $133 million.
The company had another opinion, valuing the property at $41 million.
“That’s a huge gap, and when you look at the tax as a whole from the original valuation using the process to what they wanted to pay, it’s almost a $1 million difference in taxes and almost $100 million in valuation,” Petitjean said.
Bayou Cove appealed to the local Board of Review – the Acadia Parish Police Jury – who denied the appeal. The company then appealed to the tax commission, which determined a value of $41 million. In its ruling, the tax commission said that Petitjean’s office should have used the 10-year depreciation scale, not the 25-year one it used.
“Our argument was that it was pretty ridiculous because who would agree to do something for free and at the end of 10 years it’s worthless,” he said.
The assessor’s office then appealed to its local district court.
“I want to thank Dr. (Doug) Chance,” said Petitjean. “We worked hand-in-hand with him, and Superintendent (John) Bourque. We had their support to really go after this.
“It was a costly process.”
As the assessor’s office moved forward in the court system, and getting “pretty decent rulings,” the parish learned of the city of Alexandria’s pending purchase of one of the four units.
Alexandria would end up completing the sale for that unit for $26,775,000.
As Petitjean pointed out, if one of four units is worth almost $27 million, the parish’s valuation of more than $100 million was likely pretty close.
While looking to enter this new information into evidence, the assessor’s office then began its 2014 tax fight. In that year, the Bayou Cove said its property, with all for units, had depreciated to a value of $33.5 million. Acadia, standing firm, stated the value was still over $130 million of the property.
“It continued to be more and more ridiculous,” said Petitjean.
But like most stories this time of year, there’s a happy ending. Bayou Cove settled the cases.
The 2013 settlement netted the Acadia Parish School Board $401,394 in millage distributions. In 2014, due to a higher settlement, that number increased to $430,410.