In addition to the hurricane-related expenditures, Port Arthur’s tax base is lower than other city’s with comparable populations because of the city’s make-up: an elderly population with homestead exemptions, and a significant number of people receiving some type of government subsidy.

“These negotiations started last summer because we knew we would be very strapped to maintain areas we need to maintain because of financial issues,” he said.

Mike Eaves, Valero’s outside council, said the company hopes to avoid the annexation issue, and will look at the proposed financial agreement once it is formerly presented with details of hiring practices added.

“Based on what we’ve seen today, we are hopeful and cautiously optimistic that an agreement can be reached before the current agreement expires on Dec. 31,” Eaves said.

Valero is one of 11 companies with industrial or in lieu of tax payment agreements expiring Dec. 31. They are, Atofina, BASF/Fina, Chevron Phillips, Chevron USA, Clark, Premcor, Valero, Equilon, Great Lakes Carbon, Oxbow Calcinaing, LLC., Huntsman, Flint Hills, Flint Hills Resources, and Praxair.

Fitzgibbons said city officials are in negotiations with those companies for one-year agreements. Both parties have until Dec. 31 to reach an agreement before the current agreements expire.

skoonce@panews.com