Rural Roots Louisiana/Louisiana Bucket Brigade

Two activist groups are questioning $2.6 billion of state and local government benefits and what they say is an excessively secret approval process for a steel mill in Louisiana that involves a $5.8 billion lease-back bond. 

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The state government announced the proposed $5.8 billion steel plant for Ascension Parish in March 2025. The plant has been and is in the process of getting governmental approvals this spring and summer. 

Kathy Hipple, a former finance professor at Bard College working with the activist groups, said the state and local governments have promised $605 million in direct upfront infrastructure, $1.2 billion in estimated tax savings to the planned Hyundai-POSCO joint venture steel mill in Ascension Parish, more than $300 million in discounts for electricity and about $500 million state sales tax breaks and infrastructure support. Hipple is senior research analyst at the Ohio River Valley Institute. 

Hipple is working with the Louisiana Bucket Brigade and Rural Roots Louisiana to question the project and shed light on the terms and process of its approval. 

The state bought land for $91 million that is being leased to the joint venture with Hyundai for $1 a year, said Anne Rolfes, director of the Louisiana Bucket Brigade. After 32 years Hyundai will have the right to buy it for $99, she said. At the end of the 32 year period, the joint venture will be able to buy back the facility for $1,000. The joint venture under certain circumstances will also have the option to spend this sum to buy back earlier than 32 years.  

The joint venture plans to use cash and borrowing to come up with the $5.8 billion to build the steel plant on the west bank of the Mississippi River in the RiverPlex MegaPark in Ascension Parish, between New Orleans and Baton Rouge. Hyundai Steel will have a 50% stake and three other South Korean firms will have smaller shares. 

The Hyundai-POSCO joint venture plans to engage in a bond for title transfer with the Ascension Parish Industrial Development Board whereby the joint venture will give title to the facility and the board will grant a $5.8 billion bond to the joint venture and lease the facility to it. If the project goes forward, the joint venture would be allowed to occupy the site for 32 years with payments in lieu of taxes rather than normal ad valorem taxes due. 

The bond hasn’t been brought to the State Bond Commission for approval and the commission is unsure if it would be brought before it. The APIDB approved the bond and lease-back arrangement in March. 

The joint venture has negotiated a schedule of PILOT payments totaling $553 million over 32 years. This is considerably less than if the joint venture paid normal ad valorem taxes during the period, Rolfes said. 

When the state announced the planned steel mill last year, it said the plant would create more than 1,300 direct new jobs and 4,100 indirect new jobs. 

The advocacy groups complained about the industrial development board canceling seven of its monthly meetings this calendar year and approving the $5.8 billion bond for the project without discussion at its March meeting. 

The groups got a court order directing Ascension Parish government to release non-disclosure agreements but the government has instead appealed the order, Rolfes said. The lower court has allowed a freeze on its order while the appeal process continues.

Rolfes said her group was alarmed by the IDB’s cancellation of its scheduled meeting last week. The groundbreaking on the site is expected to occur in early September. 

Ascension Parish, Landry’s press office and the Louisiana Department of Transportation and Development didn’t immediately respond to requests for comments.

Efforts to reach the Ascension Parish Industrial Development Board and its president for a comment were unsuccessful. 

Hyundai Steel didn’t respond to a request for a comment.