By Gaige Davila
Cameron County Commissioners voted to grant Houston-based Annova LNG,a liquified natural gas (LNG) export facility planned for development in the Port of Brownsville area, a ten-year tax abatement, despite opposition from citizens and municipalities of the Laguna Madre area, during their Oct. 1 meeting.
A tax abatement is an elimination or reduction of property taxes, usually for a specific amount of time as granted by a government body.
Annova LNG will pay a one-time, $5 million fee, and $500,000 every year of the ten-year abatement. Annova LNG will pay $2.5 million within one year, and the other $2.5 million within 18 months after. Annova LNG will not receive any tax abatement during the construction of the LNG export facility, paying $14,641,000 in taxes to Cameron County.
Commissioners Sofia Benavidez, Precinct 1, Joey Lopez, Precinct 2, and Gus Ruiz, Precinct 4, voted to approve the abatement, while Judge Eddie Treviño, Jr., and Commissioner David A. Garza, Precinct 3, voted against it.
Lopez motioned to approve the abatement, with Ruiz seconding the motion.
The commissioners reached their decision after over an hour in executive session, preceded by over an hour of public comment, from those supporting and against the abatement. In the audience, there were several people in blue LNG shirts,holding small signs that said “Vote Yes” with Annova LNG’s logo on the other side. Those against the tax abatement held signs that resembled hands with their thumbs down, with “No Tax Abatements!” written across the arm, which have been present in past Cameron County Commissioners’ Court meetings on the tax abatement.
The main concerns of those against the abatements is Annova LNG being closer to establishing a LNG export facility in the Port of Brownsville, including its environmental impact, pollution, and possible damage incurred from explosions at the facility, should one occur.
“I made my position clear, at that point: I would not support any tax abatements, or any of the LNG (plants) establishing operation at the Port of Brownsville,” Treviño said, after exiting the executive session, mentioning his campaign platform from four years ago, when he was running for judge of Cameron County.
Benavidez said Annova LNG’s plans to deepen the Port of Brownsville’s ship channel was a factor in her decision, citing “indirect benefits” of people renting hotel rooms and or moving to the Valley for jobs at Annova LNG as another factor. The commissioner also said her decision was based on wanting people who live in the Laguna Madre to work and spend money there.
“Maybe for some of you who have already worked and have retired here, it makes no difference,” Benavidez said. “But it does make a difference for families who are separated because they have to leave here, and they have to go and find jobs outside of this area.”
The City of South Padre Island, located in Precinct 1, Benavidez’s district, signed a resolution against LNG plants being established at the Port of Brownsville in 2015, along with Laguna Vista, Long Island Village and Port Isabel, which are located in Precinct 3, Garza’s district. During a “Tri-City” meeting, on August 14, South Padre Island, Port Isabel, and Laguna Vista city leadership expressed unanimous opposition to LNG facilities in the area, as reported by the PRESS.
Lopez said his support of the project was based on the amount of money Cameron County would receive from LNG, over the construction and operation period.
Garza said his vote against the tax abatement was based on Annova LNG saying they were not seeking tax abatements from Cameron County after the Point Isabel Independent School District (PI-ISD) rejected their request, as stated in FERC’s Final Environmental Impact Statement (FEIS) on Annova LNG.
PI-ISD rejected Annova LNG’s request for a $120 million tax abatement in 2015. In Annova LNG’s application to the school district, as reported by the Texas Observer on March 14, 2016, receiving a tax abatement would be a “key component” into building the plant. Within a day after the PI-ISD school board rejected their application, Annova LNG said they would continue trying to establish the facility without seeking tax abatements.
“I feel a little uncomfortable about how the (FERC) application was worded and where we are in the FERC process that brings us to today,” Garza said.
When asked why he did not mention Annova LNG was seeking a tax abatement from Cameron County in his letter to FERC, President and CEO of Annova LNG Omar Khayum told the PRESS that the letter was focused on Annova LNG’s pending FERC application. Khayum said the reason Annova LNG’s permit application did not mention seeking tax abatements was “based on (their) understanding of the time.”
Commenting on Ruiz’s reason for voting to grant the abatement, Garza said, “Our tax abatement policy is a negotiable document: we can negotiate what is best for Cameron County with each individual or company that approaches us for a tax abatement.”
Garza continued, “(Annova LNG) reached out to me, but I refused to talk to them after the abatement was requested. They reached out to individual commissioners in this court, in my opinion, and once they counted to three, the others didn’t count each. I have a concern for that.”
In an August 13 response to an August 7 public information request by the PRESS, Public Information Officer Dylbia Vega said there are no records of meetings between Annova LNG and Cameron County Commissioners or Treviño.
Garza said he didn’t believe that the area had “the infrastructure in place, transportation wise” to support LNG plants, saying the $500,000 a year was not enough to prepare for their establishing.
“I have a concern with some of these corporations that come and paint us a beautiful picture,” Garza said. “They come and close our public beaches, they come and take away our access, they come and try to buy out residents who have lived their for years and years.”
Garza was referencing SpaceX offering to buy the homes and land of property owners near their Boca Chica facility in Brownsville. SpaceX is also prohibiting public access to Boca Chica Village by 12 days a year, for spacecraft launches.
In response to Garza’s comments, Khayum said Annova LNG has “followed the process, by the letter of the law to file for a tax abatement.”
Ruiz said he supported the project “to stay consistent with past (Cameron County) Commissioner courts.”
“This Commissioners’ Court has a tax abatement policy and the project here and the subject of this matter, this afternoon, qualifies for that tax abatement,” Ruiz said. “In the short past and in the long past, this Commissioners’ court and other courts before us have granted tax abatements to SpaceX, solar projects, wind projects, so if the issue is money, then this court should be in, in the future, go back and prohibit tax abatements in their policy.”
Khayum said Annova LNG’s next steps, now that the abatement has been granted, are to continue establishing “long-term” contracts with customers interested in buying LNG. According to a press release from Annova LNG, 700 workers will be employed during a four-and-a-half year construction period, with 165 permanent workers once the facility is finished.
“People talk about wanting to keep the kids in the Valley,” John Young, a member of Save RGV from LNG said. “These companies will put stuff into the air that will make the kids sick with chronic illnesses and make the old people sick with chronic illnesses.”
Josette Cruz, another member of Save RGV from LNG, said she was “very disappointed” with the vote.
“Some of these people that are currently in office need to go,” Cruz said. “They did wrong by the people, especially (Cameron County Commissioner) Sofia Benavidez, she did wrong by her constituents. It shows how quickly people jump for a dollar.”
Cruz continued, “We are currently in a climate crisis, and the more we continue to cater to these corporations, who are not human beings, we’re continuing to create this crisis.”
Rebekah Hinojosa, Brownsville organizer for the Sierra Club, said regardless of Annova LNG receiving the tax abatement, there will still be organizing in opposition of LNG facilities. Hinojosa said that Port Isabel, Long Island Village, and Vecinos Para el Bienestar de la Comunidad Costera (VBCC) qualifying for party status with the Texas Commission on Environmental Quality (TCEQ) to contest Texas LNG’s, another LNG company seeking to establish an export facility in the Laguna Madre area, air permit application was a silver lining.
“The fight continues,” Hinojosa said.