GO Zone nixes Buquet request

Buquet Distributing Co., the Anheuser-Busch distributor in Houma, was denied $8 million in Gulf Opportunity Zone funding by the Louisiana State Bond Commission to expand and remodel its distribution facility at the commission’s special GO Zone meeting held Oct. 24.

The company wants $6 million for expansion and $2 million for equipment. The expansion project is expected to create 150 jobs during construction, with a payroll of $1 million. Buquet anticipates producing seven new permanent jobs.

The Terrebonne Economic Development Authority applied to the State Bond Commission for the GO Zone funding.

The Bond Commission has been administering $7.8 billion in federal money through the GO Zone program to businesses in Louisiana affected by hurricanes Katrina and Rita. The bonds are tax-exempt for investors.

Some state officials, at first, believed the GO Zone program in Louisiana was overfunded.

But businesses have been requesting more money than the program contains, prompting the Bond Commission to establish stringency measures.

In August, the Blanco administration unveiled a system, which ranks businesses requesting GO Zone money according to the quality and quantity of the jobs that would be created.

At its Oct. 24 meeting, the commission rated Buquet’s request a five, said TEDA CEO Mike Ferdinand. An eight rating is required for GO Zone approval.

The Louisiana Economic Development Bond Review Committee had given preliminary approval to Buquet’s request for GO Zone funds on Aug. 13.

However, the committee elicited outrage after it included the following comments in its letter of approval:

“The parish of Terrebonne has been drinking more beer after the hurricanes and this project enhances that opportunity. Both Economic Development and overall heightened euphoria will occur because of this project.”

“I don’t mind if I don’t get my project in a legitimate scoring (system), but don’t give me derogatory comments about our community,” said the distributorship’s owner, J.J. Buquet, in an Oct. 28 New Orleans Times-Picayune article.

As part of the belt-tightening measures, the Blanco administration also forced businesses which had received preliminary approval for GO Zone funds to reapply.

Even those businesses that have received final approval for GO Zone funds have 120 days to complete financing, “or get to the back of the line,” Ferdinand said.

“We’ll see what we can do to further support the (Buquet) project,” he said.

Two other businesses in Terrebonne and Lafourche parishes and the Greater Lafourche Port Commission applied for GO Zone funds and received preliminary approval in 2007 from the Bond Review Committee.

Rutter Investment Group requested $6 million to construct an unspecified 14,820-square-foot retail store in Houma.

ExPert E & P Consultants asked for $8 million to build various office buildings, sub-sea testing and logistics facilities in Lafourche and St. Tammany Parishes.

The Greater Lafourche Port Commission wants $10 million to construct a new search-and-rescue helicopter facility. The commission expects the project to create 40 new permanent jobs.

A third company, Central Port, which wants $50 million to build a shipyard repair facility at Port Fourchon, had its preliminary approval placed on hold by the committee.

Ferdinand said the State Bond Commission may acquire more bonding capacity in the future.