Mayor Arceneaux has proposed a 2027 city budget with an $8 to $9 million in additional payroll for first responders and approximately 400 classified employees.
The proposed budget has income projections that Mayor Tom has repeatedly said have a fiscal cliff. He acknowledges that building permit fees for the Stateline data center and the Shreveport data center should cover the added payroll for approximately two years.
Sales taxes will increase from the costs of construction materials for both data centers along with purchases by construction workers. How much the city’s share of sales taxes will increase and for how many years is the open question.
There will be recurring revenue from property taxes on the data center buildings and from AEP/SWEPCO franchise fees, once the centers are built.
The franchise fees are paid to the City for the use of city right of ways for poles, lines and equipment. Shreveport has a 5% franchise fee.
Part of the franchise fee—2.5%--is billed as a line item on each customer who lives in the Shreveport city limits, which excludes Gage-Watts, and the remaining 2.5% is included in the Louisiana Electricity Rates.
The City of Shreveport receives approximately $14 million in Franchise Fees from SWEPCO annually. This is a “pass through tax”, which is collected by the SWEPCO and remitted to the City.
Currently 2% of the 5% of the Franchise Fee is allocated to the Streets Special Revenue Fund to fund street repairs. This allocation can be changed by a Council vote.
Site work for the Stateline data center commenced several months ago. No site work has started on the Shreveport data center which is most likely on hold until the Second Circuit Court of Appeals renders its decision on the contested center. This opinion is expected before year end.
Some are questioning the funding for the pay raises which includes benefits that will be continual while some of the future funding for the same will fall off the fiscal cliff.
