$1.4B tax break OK’d for gas terminal

BATON ROUGE — A company planning a $15.9 billion liquefied natural gas export terminal in southwest Louisiana won approval Friday for a five-year property tax break expected to be worth up to $1.4 billion.

Over 10 years, the tax break for the manufacturing facility through the state’s Industrial Tax Exemption Program could balloon to more than $2 billion, when the effects of a potential five-year renewal are included. That could make it the most expensive tax break ever awarded in the state, according to Together Louisiana, an organization seeking more scrutiny of the such exemptions.

Louisiana’s Board of Commerce and Industry overwhelmingly backed the property tax break for the Driftwood Liquefied Natural Gas project in Calcasieu Parish, after efforts to delay a decision failed in a 17-2 vote against postponement.

Gov. John Bel Edwards supports the project and will sign off on the exemption, his spokesman, Richard Carbo, said after the vote.

The production and export terminal by Driftwood, a subsidiary of Tellurian Inc., is expected to create 350 permanent jobs with salaries averaging more than $90,000 when it opens on the west bank of Calcasieu River, scheduled for 2023, according to economic development data. Houstonbased Tellurian said it will make a final investment decision early next year.

Documents provided to the board estimate the first year of the tax break would drop local property tax revenue by nearly $284 million, dollars that otherwise would go to schools, public safety programs and other parish operations.

Over five years, that tax break could reach as much as $1.4 billion — the equivalent of $4 million for each job created. If a second five-year renewal is eventually granted, the exemption could top $2 billion, costing millions more per job, according to estimates.

But supporters say the project also will create 6,400 construction jobs and have a wideranging spill-out effect across the region, creating many more indirect jobs.

Sen. Norby Chabert, a Republican from Houma, called the project “a heck of a deal.”

Board approval Friday came despite accusations that local officials violated public meeting laws in backing the exemption. Questions were raised about the private meeting used to recommend support of the tax break, and local media reported that agendas for public local meetings about the exemption lacked information about the total price tag of the tax break.