2nd gas pipeline firm seeks county tax break| [8/18/06]

Published 12:00 am Friday, August 18, 2006

Following the strategy of a competing proposal, one of the companies asking to build and operate a new natural gas pipeline across Warren County will ask for a break on property taxes.

Gulf South Pipeline LP plans a 42-inch pipeline 240 miles long, stretching from a hub near Keatchie, La., to one in Harrisville in Simpson County.

It would cross into Warren County just south of the Baxter Wilson Power Plant and continue across U.S. 61 South near Grange Hall Road and run across the county line with Hinds near the southern edge of Bovina Cut-Off Road.

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An official of Boardwalk Pipelines, of which Gulf South is a subsidiary, along with Gene Magee and Kim Smith of the Jackson law firm of Butler, Snow, O’Mara, Stevens & Cannada, made overtures about tax breaks during the board’s informal meeting Thursday.

&#8220Part of our cost-cutting process is to try to have all the tax exemptions we can,” said David Hardesty of Boardwalk’s ad valorem tax division, who appeared before City of Vicksburg officials Wednesday to ask for a fee-in-lieu-of-taxes deal in the city, too.

Four months ago, supervisors approved a fee-in-lieu deal for a 36-inch pipeline spanning 270 miles from Delhi, La., to Mobile, Ala., proposed by Houston-based Duke Energy Gas Transmission and CenterPoint Energy Gas Transmission.

That pipeline is to pass through Warren County between the Yokena and Cedars communities in the southern part of the county.

The deals approved for Duke Energy and desired by Gulf South are the same in that they would allow the companies to pay one-third of ad valorem taxes for 10 years.

The difference between the two comes in the potential amount paid to Warren County.

Duke Energy’s pipeline is a longer project, spanning parts of three states, thus a smaller investment in each county. The fee-in-lieu to the county and the school district would be $125,000 in each of the first 10 years, then $375,000 per year in subsequent years, based on company estimates.

The Gulf South project fused two pipeline projects together to conceive the East Texas to Mississippi Expansion Project. Despite running just 10 miles apart from the Duke Energy pipeline after crossing under the Mississippi River, the Gulf South pipeline will run through more of Warren County than the Duke Energy pipeline, thus making for a bigger investment here.

With project cost estimates at $780 million, and the true value of the land it will cover here at $40.5 million, it leaves the potential fee-in-lieu over 10 years at $477,852, according to calculations by Tax Assessor Richard Holland, present in the meeting room for the discussions.

Reached Thursday, Mayor Laurence Leyens said he was not present when Gulf South talked with strategic planner Paul Rogers and South Ward Alderman Sid Beauman about a fee-in-lieu for city taxes.

&#8220We want to tap into that line, though,” Leyens said.

Both it and the Duke Energy project, called the Southeast Supply Header, have tentative routes that must be approved by the Federal Energy Regulatory Commission pending an environmental review.

Construction on both is expected to begin in mid-2007 at the earliest.

In other business, supervisors directed the board attorney and engineer to mull the 30-page subdivision ordinance and come up with ideas about any changes that may be needed.

The issue gained traction earlier this month when the county halted work on The Trace subdivision off Fisher Ferry Road because drawings were not filed before work began to level the land and complete the main road into the subdivision.

At the heart of the dispute is the definition of &#8220construction.” The board heard from the subdivision’s lead developer, David Brewer, who answered questions and made suggestions to County Engineer John McKee.

Brewer’s objection has been the inability to supply accurate elevations required in the ordinance before cutting down hills to set a roadbed that can pass muster for county maintenance.

McKee said he &#8220disagreed totally” with the notion that moving dirt is not &#8220construction,” and asked Brewer if the county had caused anything to delay the final construction approval of the subdivision’s first phase.

Brewer replied that he and developers of other subdivisions are not given concise &#8220punch lists” detailing exactly what they need to have their plans approved and roads maintained.

&#8220If (developers) feel they’re fighting the system, they won’t come in (to have plans approved),” Brewer said.