Exxon’s $ 9B plant gets Texas tax break
PORTLAND, Texas — Exxon Mobil Corp. and its Saudi partner were granted an estimated $ 1.2 billion in tax breaks over 10 years from a South Texas school board to build a controversial $ 9.3 billion petrochemical plant just north of Corpus Christi.
Defying community opposition, the Gregory- Portland Independent School board unanimously approved the tax package late Tuesday.
It’s trying to entice Houston- based Exxon and partner Saudi Arabia Basic Industries Corp., or SABIC, to build what would be the world’s largest ethane steam cracker plant less than 2 miles from Portland’s high school.
The joint venture, which promises thousands of jobs, got the green light and a separate package of tax incentives worth roughly $ 210 million over 7 years from San Patricio County on Monday.
“We’re the school board and I thought we were supposed to be educating our kids, but it seems like we’re in the middle of economic
development,” Randy Eulenfeld, the board’s president, said during the four- hour meeting. “We will take this responsibility and do the best that we can.”
After the final vote was tallied, Eulenfeld said he was “relieved that this part is over and that we can talk about something else.”
While the value of the completed project is estimated at $ 9.3 billion, the school district agreed to limit the taxable value at $ 90 million for 10 years starting in 2024 when the plant is scheduled to open.
That reduces the school district’s tax revenue from an estimated $ 120.9 million per year to less than $ 1.2 million per year, according to a copy of the plan.
The companies, which still need state approval, also are looking at a site in Victoria and two in Louisiana, but the San Patricio County location is leading the pack, project leader Robert W. Tully said in January.
The ethane cracker plant uses high heat and pressure to break down natural gas into ethylene and polyethylene — the base chemicals used in plastics.
The proximity of the crackers to the high school has rankled some residents since news of the plans a few months ago.
Exxon has borne the brunt of the criticism from local opposition, specifically from Portland Citizens United, a grass- roots organization that turned in a petition Tuesday with more than 1,500 signatures opposing the plant. But both companies were under the gun Tuesday.
“They are bullying this county, they’re bullying you … we don’t allow bullies in our schools,” Errol Summerlin, who signed the petition, said at the meeting. “We shouldn’t tolerate it from them.”
Jason Mutschler, who spoke against the project, got emotional after the county and school board votes.
“I don’t like the vote; I hate the vote,” Mutschler said, though he added that the school board “did their due diligence” better than the county.
He said Portland Citizens United, which he is a member, plans to contest the companies’ permit applications with the Texas Commission on Environmental Quality, Exxon’s Tully said the company hopes to soon submit the applications.
School board member Victor Hernandez repeatedly asked Tully what the company would do for homeowners near the site who could have trouble selling their homes if the state approves the plant.
Tully said Exxon has a program to compensate homeowners for reduced property values.
The company will buy properties that have a hard time selling for up to six years after the permits are issued.
He said an outside company would run the program, valuing homes as if the plant wasn’t there.
“If we do choose the Gregory- Portland site as our location, I want to assure you that we will follow through with our Good Neighbor Commitments on health and safety, quality of life, education and workforce development, and being good environmental stewards,” Tully wrote in an email sent to residents Wednesday evening.
He said project managers have held more than 80 meetings with the community.
“Many of those meetings were encouraging and supportive, while others were pretty tough, to say the least,” he said.
The debate got personal at times.
School board secretary Carrie Gregory said she was disappointed that some had engaged in “character assassination” over the past few months.
Fred Nardini, Portland’s county commissioner, said Monday morning that he and his family were personally attacked over the debate.
The tax breaks are contingent on job creation. by project leaders to the Texas Comptroller’s Office commit to creating 13,570 temporary construction jobs at average annual wages of $ 87,500 and 170 permanent jobs at average annual wages of $ 59,408.