PAnews.com, Port Arthur, Texas

November 26, 2013

PA Council approves initial two industrial agreements

Sherry Koonce
The Port Arthur News

PORT ARTHUR — With little more than a month to go before the city’s industrial agreements with local companies expire, Port Arthur City Council approved two new contracts Tuesday.

Veolia Environmental Services and GT OmniPort both have forged industrial agreements, also known as in lieu of tax payments, with the city.

Veolia has agreed to pay 95 percent of what the company would be paying in property taxes, if the company were located inside city limits, rather than the city’s extraterritorial jurisdiction. Veolia’s contract is for one year.

GT OmniPort has agreed to a three-year contract. The company will pay the city 80 percent of what it would have paid in property taxes. In exchange, GT OmniPort will provide to the city reports detailing its efforts to hire Port Arthur residents and purchase materials from local vendors. The company will also participate in the Port Arthur Industrial Group and the Port Arthur Business Enterprise.

“When they give these reports we will know where we stand with the numbers. We will know where they are with hiring local vendors,” Val Tizeno, Port Arthur city attorney, said.

If OmniPort reaches certain milestones tied to local employment and purchasing, the company will receive an additional discount on their in lieu of tax payment.

The city has also reached agreements with two other companies: Oxbow Calcining and Port Arthur Steam Energy.

Both have agreed to the same-type three-year agreement as GT OmniPort. The companies will pay 80 percent, and agree to provide the hiring and vendor data, as well as participate Port Arthur Industrial Group and the Port Arthur Business Enterprise.

City officials are currently in negotiations with the remaining nine companies that have not yet forged an agreement.

If the companies do not enter into a in lieu of tax agreement, the city is poised to annex the property.

Council at its Tuesday meeting conducted the last of three public hearings to discuss annexation plans.

“In lieu of tax agreements are about money, dollars and cents. Any time you put extraranous factors into the contract you complicate the process. That is what we are doing, what we have been doing, and that is why it takes a bit longer,” Robert E. “Bob” Williamson, District 6 city councilman, said.

Tying jobs and local purchasing to industrial contracts is not a new concept, Williamson said.

Five years ago, when the same contracts were forged, the city attempted to do the same thing. Though several of the contracts included an agreement that the companies would strive to hire locally, and do business with local vendors, they did not do what was required, Williamson said.

“Only one followed up and did what was required, that was TOTAL, and very much appreciate their effort,” Williamson said. “Now we are trying a different approach to solve the same two problems. We need more permanent jobs for our citizens, and more procurement from local companies.”

City Council is required to have two readings before they can vote on possible annexation.

The first will be on the next Council meeting scheduled for Dec. 12. The second reading and vote that same day has not yet been scheduled, but will have to be held prior to Dec. 31 when the current industrial agreements expire.

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