Copyright Baton Rouge Advocate
West Feliciana Parish may get better roads, a new jail and pay raises for teachers and sheriff's department employees thanks to an agreement with a data center developer that could generate up to $90 million in annual revenue for the parish. Construction is underway at the $2.5 billion data center stewarded by Hut 8, a Miami-based company that will lease the computing services to an undisclosed client, providing thousands of construction jobs and at least 50 maintenance and technician jobs. Thanks to a recently approved revenue structure, earnings from the center are coming sooner to fund priorities for parish agencies. Before an Oct. 28 meeting of the Industrial Development Board, it was unclear how much the parish would be able to reap from the center since the state exempted data centers from paying sales and use taxes. The parish could collect property taxes on the center after construction wraps, but the meeting cleared the way for the parish to collect payments in lieu of taxes, referred to as PILOT. Instead of paying property taxes on the facility, Hut 8 will donate its 611-acre site to the IDB. The board will then lease the property back to the company, charging rent equal to what sales and use taxes would be on the billions of dollars worth of sophisticated electronic equipment that will fill up the data center. The data center will be about the size of four Walmart Supercenters. The IDB is comprised of West Feliciana Sheriff Brian Spillman, School Superintendent Hollis Milton and former council member Clay Pinson, each of whom will administer a third of the revenue. The revenue could have a significant impact. The school system had total revenues of $36.5 million in fiscal year 2025, while the parish adopted a $3.3 million budget for the current fiscal year. The Sheriff's Office had more than $12 million in revenue for fiscal 2024. “We want to make sure that the people that sat on our board, first of all, were the stakeholders,” Parish President Kenny Havard said. “And secondly, that it was people that were accountable to the people.” The IDB was formed during a recent Parish Council meeting. Havard said the timing of the formation of the body was in response to Hut 8 finalizing paperwork on the center. The last time the parish formed an IDB was in 1967. Havard said the company is working with Louisiana Economic Development on the state's tax structure for the project. LED officials could not confirm their status on an agreement with Hut 8. If the data center were to experience any disruptions in the future, the property would go back to the tax rolls, he said. The PILOT agreement would protect the parish from financial pitfalls, as payments are not derived from taxes. "A meteor could hit us, but we got the best deal for the parish," Havard said. Pursuing revenue via PILOT allows the parish to start benefiting from the data center up front, Havard said, rather than having to wait until construction finishes to collect property taxes. As of now, the parish is set to start receiving payments in 2027, but he is negotiating with Hut 8 to try and receive payment earlier. Ad valorem taxes, or taxes levied based on an item's value, are a local issue and should be handled by locals, he said. It is not the first time West Feliciana has received a major boost from project revenue. In 2018, the Louisiana Tax Commission decided to direct $6.6 million in tax revenue from Entergy's River Bend nuclear plant in St. Francisville to West Feliciana, which the parish used for road repairs, the school system, the Sheriff's Office and the fire department. At the time, the parish could spend the money only in accordance with property tax guidelines. The revenue from the nuclear plant is depreciating, Pinson said, which has contributed to the parish straying away from making the infrastructural improvements that data center revenue will pay, in order to avoid building debt. “We’re just a small parish; we live within our means,” he said. Pinson represents the Parish Council on the IDB, because he has a grasp of the budget and spending priorities from his time as chairman of the finance committee. Parish employees cannot serve on the IDB, he said. Spillman said his office's cut of the revenue will fund a new jail. The current jail, built in 1948, can hold only 38 male offenders. Female offenders and those with disciplinary and medical problems must be sent to another facility. “The building is a maintenance nightmare,” he said. An updated jail is the main priority for the Sheriff's Office, along with salary adjustments for staff to better retain and attract employees. Milton said he is planning “significant” pay raises for school faculty and staff. Specifics on the amount increases cannot be shared yet, he said, but he projects the raises will bring the salaries to the top five among school system salaries in the state. Annual salaries for West Feliciana teachers currently start at $54,272, the third-highest pay in metro Baton Rouge. Milton said he is recommending to the board that the schools use the revenue to expand student programs, particularly in career and technical education, academic support, athletics and the arts. The revenue will also go toward paying off the construction bond that paid for various projects, including a new elementary school, gym and Career and Technical Education center. That would reduce the current 6.2 mill property tax levied to pay off the bond.
