BROWNSVILLE, RGV – Cameron County Administrator David A. Garcia says Rio Grande LNG will receive a tax break of $373,100,000.00 for its liquefied natural gas export terminal project at the Port of Brownsville.
Cameron County Commissioners Court voted to approve the tax abatement agreement at a meeting on Tuesday.
“It’s roughly a 76 percent tax abatement which would equal to about a $373,100,000.00 tax break,” Garcia told the Rio Grande Guardian.
“The County gets $37 million – $27 million in Payment In lieu of Taxes payments and $10 million in community benefits – plus a commitment of beneficial use material from dredging to use for beach nourishment and erosion control. Under the rems the PILOT can go up two or three times the amount.”
In a news release, Cameron County said the Rio Grande LNG project, at full build-out, “is anticipated to be a $15.7 billion dollars investment essentially almost doubling the county’s current tax base.” The County predicted the agreement will “increase investment, grow the job and labor market, and provide economic opportunities for the county and region as a whole.”
According to Rio Grande LNG, an estimated 5,000 construction jobs and 300 permanent jobs would be created if their export terminal gets built at the Port of Brownsville. Port of Brownsville Port Director Eduardo Campirano is excited about this prospect, and an agreement that Rio Grande LNG will work with Cameron County to closely identify dredge material that can be utilized for the benefit of the coastline and provide beach re-nourishment at county beaches to ensure the long-term viability and integrity of local dunes and beaches.
The County is currently undergoing an Erosion Response Plan as well as a Dune Protection plan to solidify the beaches and prevent further erosion from occurring.
“The Board of the Brownsville Navigation District has long partnered with the County to improve one of the major economic engines of the Rio Grande Valley – the Port of Brownsville. Once again, the County Commission has proven that it can objectively consider difficult issues. The ability to pursue the deepening and partner on the dredging project will be a game changer for the region and this community. On behalf of the Board, I thank the Commissioners Court for this forward-thinking vote and the positive impact it will have on the region,” Campirano stated.
Under the terms of the Cameron County-Rio Grande LNG agreement, county officials say they have been guaranteed a minimum of 35 percent of construction and permanent jobs for local residents. If this does not happen, the company will be penalized with payments for missing the target on this benchmark.
In addition, Cameron County has negotiated a “Payment in Lieu of Taxes” (PILOT) payment that can total at a minimum $27 million and can grow to a maximum of $81 million over the course of the abatement.
There is also a Community Benefits Agreement totaling $10 million for projects that will benefit the community. Cameron County Judge Eddie Treviño, Jr., said these funds will be available for leveraging of long-term projects important to the County or closing the funding gap of ongoing projects that benefit the community.
“More than 75 years ago the visionaries at the Port established and prepared for times like this. The proposal before us is a partnership between the County, the Port and the company to see the realization of the deepening of the Brownsville Ship Channel and attracting industry to the region,” Treviño said, in the Cameron County news release. “This could potentially be a win-win for the area so long as jobs a recreated and the environment is protected. I look forward to working on this project as it moves forward and through the Federal Energy Regulatory Commission approval process.”
All four county commissioners provide quotes in the news release.
County Commissioner David Garza said: “We are in a transformative time and we have to move this county forward. We don’t need and we don’t want a brain drain. We need to have a balance when it comes to economic development versus sustainability and protecting the environment. We need to put the Port of Brownsville in a position to succeed.”
County Commissioner Gus Ruiz, said: “The community throughout the county will benefit immensely from this endeavor. We will create a vibrant community and develop parks and other areas for families to enjoy. In addition, training at TSTC and other programs in high school will add a major educational component that we have not seen in the Rio Grande Valley. I am also glad to see that we will work on attracting the best and brightest from the local workforce as we grow the economy of Cameron County. This proposal will inject some funding for the foreseeable future to the county. My job is to make decisions for the overall greater good of my constituency and I am confident this proposal will do just that.”
County Commissioner Sofia Benavides said: “This is a project that is endorsed by many, including universities (UT-Rio Grande Valley), technical schools (TSTC & TSC) the Texas Workforce Commission, various school districts, the Rio Grande Valley Partnership and the Port of Brownsville which is in my precinct. The agreement we approved has safeguards and provisions that provide opportunities, FIRST, to our workforce. There will also be training opportunities for students to move into these technical trades and so because of that, I voted for this agreement. This also gives us an opportunity to invest in our long-term infrastructure as more and more companies look to Cameron County and South Texas.”
County Commissioner Alex Dominguez said: “We have made sure that there are provisions in here that protect the community and the taxpayers. I am satisfied that we have made sure that job opportunities will be provided first and foremost to county residents. We have many families dealing with the hardship of the breadwinner going off to other parts of the state and country to find work. I have heard those stories time and time again. With this project, we can work to keep some of those people here and have them close to family and also contribute to the local economy.”