- The Enterprise
- The Recorder
Public speakers voice mixed feelings
By AMANDA SCOTT
Following 20 speakers’ comments during a public hearing this week about granting Dominion Cove Point tax credit and payments in lieu of taxes, the county commissioners didn’t seem to hesitate to grant the proposed agreement.
The Calvert County Board of County Commissioners unanimously approved to close the public record and amend county code to permit the county to grant a property tax credit and enter into an agreement for the payment of county taxes with the owner of a facility for the liquefaction of natural gas. The commissioners then unanimously approved to close the public record and enter into a five-year payment in lieu of taxes and nine-year tax credit agreement with Dominion Cove Point Liquefied Natural Gas.
The Federal Energy Regulatory Commission still has to approve Dominion’s proposed LNG exportation project.
Of the 20 speakers, 11 expressed their support for the project and the county’s efforts to make the project successful. Maryland Senate President Thomas V. Mike Miller Jr. (D-Calvert, Prince George’s), Del. Anthony J. O’Donnell (R-Calvert, St. Mary’s) and Del. Mark N. Fisher (R-Calvert) expressed their support. The remaining eight were involved with trade unions.
Lino Cressotti, the business manager for Insulators and Allied Workers Local 24 and vice president of the Washington Building Trades, said, “The Cove Point export project represents new opportunities and new investments in the state of Maryland. Many of us who make our living through these practices of construction-related trades may not see another project like this during the rest of our working lifetime.”
Brad Karbowsky of the United Association of Plumbers and HVAC Techs, thanked the commissioners for “doing all they can … to make sure this project goes forward.”
In previous meetings, Karbowsky said, he’s heard people say the jobs are temporary. “Well, these are not temporary jobs. These are career jobs. Construction workers have careers, too. In fact, most people, when given this opportunity, would be ecstatic to work on a project for two and a half years,” he said.
He said people need to understand “we’re not some transient, migrant workers,” but rather, those who live and serve in the community.
Once again, speakers asked the commissioners to defer a decision related to Dominion’s project until an environmental impact statement is conducted and the residents’ concerns are addressed.
Lusby resident Leonard Zuza said he doesn’t “categorically oppose” the facility, but issues need to be addressed before entering into legal agreements.
“You now have negotiating leverage because Dominion wants this deal as much as you do. Once you make significant contractual concessions, your leverage disappears.”
Jean Marie Neal, a member of Dominion property’s neighboring Cove of Calvert Homeowners Association, described the public hearing as a “tax giveaway hearing” and said the BOCC has “become Santa Claus for Dominion and ‘Scrooges’ for residents.
“Dominion needs Calvert County far more than Calvert County needs Dominion,” Neal said. “Delay this. Put more thought into what you’re doing.”
Before the vote, Commissioner Gerald W. “Jerry” Clark (R) said the agreement wasn’t just recently thought of or discussed, but “we’ve been living this [project] since before this board,” in 2008 or 2009.
“I would defy anyone who says I don’t care about the 1st district,” Clark said. He said he supports the project “100 percent.”
Commissioners’ President Pat Nutter (R) tried to assure residents that “not everything’s carte blanche. … We’re not going to turn our heads.”
Clark added, “We will oversee this, and we will minimize any … impacts,” though largescale projects don’t come without inconveniences.
Commissioner Susan Shaw (R) said, “We got the best deal from Dominion that we could get. … This is a win-win.” She then expressed her full support for the project and “to the many benefits it’s going to bring.”
For each of the five years of the payment in lieu of taxes (PILOT) period, which begins July 1, 2017, Dominion is required to pay the county $15,100,000. If the plant is in service by July 1, 2018, then the PILOT period ends June 30, 2023. Depending on when the plant begins service, the PILOT period could end June 30, 2025. If the plant is not in service by June 30, 2020, then the agreement is automatically terminated.
In the first PILOT year, Dominion will pay $35,805,000; the second year, $45,100,000. The third year — when the PILOT payment peaks — Dominion will pay $48,895,000. In the fourth and fifth years, Dominion will pay $48,345,000 and $47,685,000, respectively.
As part of the PILOT agreement, if Dominion incurs cumulative expenditures equal to or greater than $500 million by Jan. 17, 2018, then Dominion will make a one-time payment of $25 million to the county before Jan. 31, 2018, but after Jan. 17, 2018.
If the property, after the export expansion is in service, is determined by the Maryland Department of Assessments and Taxation to be valued at more than $4.788 billion, then the PILOT payments for the applicable fiscal year can be adjusted by an amount equal to 55 percent of the taxes due under the then-current law on the difference between the state’s assessment and $4.788 billion.
The PILOT “removes risk of financial loss to the county on the depreciation of existing equipment,” according to staff’s presentation.
Once the PILOT period ends, July 1 of the fiscal year immediately following, a nine-year tax credit equal to 42 percent of the property tax imposed upon Dominion’s property begins. After the nine years, the assessment, levy and collection of the property tax will be made pursuant to the then-current law.
During staff’s presentation, Calvert County Department of Economic Development Director Linda Vassallo said without the agreement in place, Calvert County faces the real risk of facility closure, the loss of about 100 existing, high-paying jobs in the community and the loss of significant tax revenue.
With the agreement in place, Vassallo said, Calvert County creates a business environment that makes the project economically feasible and ensures significant increases in tax revenue through 2032.