"Louisiana got the plant because of the tax equalization contract the governor offered relative to what Texas offered," says Roy O. Martin III, president of the lumber company. "That offer really was the linchpin in making the deal happen here in Louisiana."

Northrop Grumman Ship Systems is the largest manufacturing employer in Louisiana, with a payroll of more than 6,000 workers. The Avondale Operations facility in New Orleans, shown above, manufactures the LPD 17 amphibious assault ship, left, for the U.S. Navy, as well as oil tankers for a ConocoPhillips subsidiary. Shipbuilding is big business on the Louisiana coast. Economists forecast 12,700 new positions in the next two years at the Avondale Operations, Bollinger Shipyards, Trinity Yachts and Textron Marine and Land.

      The company, headquartered in Alexandria, La., has a major presence in the state already with facilities in Lemoyen, Chopin and Pineville that, combined, employ more than 1,000 people. The new facilities, an oriented strand board (OSB) plant and a dry veneer plant, will create more than 200 jobs.
      "All things being equal, our first choice was Louisiana," says Martin. "But things were not equal at first." The Corrigan, Texas, site was closer to a key market than Louisiana, and Texas timber had tax advantages, such as no sales tax on utilities, that Louisiana did not. And Texas made it clear that it wanted to do business with Roy O. Martin. "They were very aggressive and sought me out when they heard we were looking at building a site. They came over and really did a hard sell."
      But Louisiana fought back, bringing to the table a volume cap bond allocation of $8 million to finance air pollution control equipment; the company will sell tax-exempt bonds and reduce its cost of capital. The deal clincher, though, was the partial tax equalization incentive of $20 million for 10 years — $10 million in the first five years and another $10 million in the next five years. The credit is capped at $2.5 million in any given year with unused excess over $2.5 million to be rolled forward to subsequent years. "It is quite an impressive package," says Martin, "and it's something other companies considering coming to Louisiana should look at."
      Roy Martin's organization has been doing business in Louisiana since 1923. "The Blanco administration is the easiest to work with in terms of helping you get through the regulatory barriers quicker," says Martin, a third generation company president. "They are very aggressive in terms of working with you on the plant site selection process, and they have some excellent people doing that. They know what is important to business people."
      Recent efforts to improve education standards in the Alexandria area have resulted in a better-educated work force, Martin maintains. "That was not the case in 1995 when we built the Chopin plywood plant. There has been a big change in the last nine years." Which is important, because Martin now employs a more educated work force than one might think. "The modern OSB plant is a high-tech facility, and logging is becoming a high-tech industry. Everything is computer-controlled with very few people directly touching the manufacturing process. Maintenance and electrical staff have to be top quality."