Summary
The Louisiana Supreme Court interpreted Section 3(C) of Act 456 of the 2007 Regular Session concerning motion picture infrastructure tax credits under La. R.S. 47:6007. The court held that the provision imposed a deadline of January 1, 2010, after which no tax credits could be earned on expenditures, and reversed the court of appeal.
Topics
Practice areas
Questions Presented
- Whether Section 3(C) of Act 456 imposes a deadline of January 1, 2010, for expenditures qualifying for the forty-percent infrastructure tax credit.
- Whether testimony from legislators and other witnesses concerning their interpretation of Section 3(C) and legislative intent was admissible or relevant to the statutory interpretation inquiry.
Holdings
- Section 3(C) is ambiguous because both parties' interpretations are plausible, but its language and contemporaneous legislative history establish that a grandfathered infrastructure project must incur the qualifying expenditures within the twenty-four-month period. For Red Stick, the deadline was January 1, 2010; it was entitled to the forty-percent tax credit only on expenditures incurred by that date.
- The testimony of legislators and other witnesses was not inadmissible per se, and some testimony was relevant to understanding the history of Act 456; however, the court declined to consider their personal opinions about the statute's meaning or the Legislature's intent because individual legislators' views do not establish the intent of the Legislature as a whole.
Key quotations
“We hold that evidence comprising the contemporaneous legislative history of Act 456 supports the State's position.” (194)
“We hold that Section 3(C) of Act 456 means that a grandfathered project, such as the one submitted by Red Stick, is only entitled to forty percent tax credits on expenditures incurred by January 1, 2010.” (194)
Factual background
Red Stick submitted an application on February 27, 2007, for a state-certified motion picture infrastructure project with a proposed investment exceeding $665 million. While the application was pending, the Legislature enacted Act 456, including Section 3(C), which imposed a twenty-four-month qualification period and a minimum expenditure requirement for projects filed on or before August 1, 2007. The State's initial certification letter stated that Red Stick could earn tax credits only through January 1, 2010, while Red Stick contended that satisfying the minimum expenditure requirement by that date entitled it to forty-percent credits on later expenditures for the life of the project.
Procedural history
Red Stick applied in February 2007 for certification of a large motion picture infrastructure project. After the State's initial certification letter stated that Red Stick had until January 1, 2010, to earn tax credits, Red Stick sought mandamus and declaratory relief. The mandamus claim was dismissed with prejudice, but after trial the district court ruled that Red Stick could earn the forty-percent credits on expenditures made for the life of the project; the court of appeal affirmed. The Louisiana Supreme Court reversed.