Big Energy still getting Big Tax Breaks

As energy interests continue to post record profits, the Wall Street Journal reveals (no link, pay only) that refineries are still collecting tax breaks and subsidies, some getting "hundreds of millions of dollars":

Despite public frustration over high pump prices and flush industry profits, major refining companies are seeking and winning large local tax breaks for their refinery-expansion plans with little political opposition.

The reasons: The Bush administration is encouraging refiners to produce more gasoline to help keep prices down, while local communities fear the companies will take jobs elsewhere if they aren't offered inducements to stay.

It's part of what Greg LeRoy calls The Great American Jobs Scam -- the billions of dollars in give-aways officials hand to corporations for "economic development." For example, here's what Motiva LLA -- a British/Dutch venture involving Shell -- is trying to extract from Port Arthur, Texas, which includes slashing its tax support of schools:

The assortment of incentives means that a project like Motiva's $3.8 billion expansion in Port Arthur, Texas, could result in nearly $700 million in reduced federal tax payments, plus more than $600 million in local abatements. The federal incentives allow refiners to expense 50% of the costs of refinery investments that increase plant capacity by at least 5% or boost production of key products like gasoline by at least 25%. [...]

The refiner has applied for a lower assessment from the Port Arthur Independent School District, one of two major tax-collecting bodies in the industrial East Texas city, said Dan Casey, a partner at Moak, Casey & Associates, an Austin-based consultant retained by the school system. If the tax break is granted, Motiva will pay annual taxes on just $30 million of project costs -- instead of the $3.8 billion total -- during the project's first eight years of operations, a shift that could save the company more than $50 million a year during that stretch under the current tax rate.

And here's what Chevron has tried to get out of hurricane-ravaged Mississippi:

Chevron sought $22 million from the Mississippi legislature this year to support a road expansion that would further the company's proposed refinery expansion in Pascagoula. But the effort died, in part because it started too late in the legislative session and also because of criticism from some circles citing Chevron's high profits.

Chevron hasn't been deterred, though: "Chevron has met with Mississippi Department of Transportation officials since the effort failed," the WSF reports, "and is encouraged by their receptivity, said Chevron spokesman Steve Renfroe."