US oil major ExxonMobil has failed to meet the terms of its tax abatement agreement with the Texas county of Montgomery and may have to pay about US$4 million to it unless it can boost compliance within 30 days, county commissioners said on March 23.
The company, according to Montgomery County Community Impact Newspaper has signaled it would rather opt for the payment, county officials said.
The report in the community newspaper said that in 2013, Montgomery County Commissioners Court and The Woodlands Township board of directors each approved two 10-year 100% tax abatements to ExxonMobil for one and a half office buildings and an 11-story parking garage in the Hughes Landing development in The Woodlands.
The report said that as part of the agreement, the company was required to meet various job creation requirements, the most recent being to have 470 employees at the buildings as of the January reporting period. However, ExxonMobil reported an average minimum of 284 employees and an average maximum of 438, Montgomery County Tax Assessor-Collector Tammy McRae said, according to the newspaper report. Building A is in compliance, but Building B is not, she said.
Precinct 2 Commissioner James Noack said officials had spoken with ExxonMobil on the employment requirements, and the company was aware they were not in compliance.
“They knew that they were going to have fewer people in building B than they should have had,” Noack said. “I told them that my recommendation to court was going to be to put them in default, and they would have 30 days to cure; they responded to me that their business division would more likely just rather default than have to go through the process of hiring more people.”
Commissioners, according to the report, said the 30-day notice was “generous,” but McRae said companies are statutorily required to receive such a notice. If the company does not comply with the tax abatement requirements within 30 days, it will owe about US$3.9 million total to Montgomery County, The Woodlands Township and The Woodlands Road Utility District as well as some money to another municipal utility district, McRae said.
McRae said in her conversations with the company, they did not discuss why the employment numbers were low, and ExxonMobil officials were not present at the March 23 meeting.
A Worker Adjustment and Retraining Notification notice that ExxonMobil would lay off a total of 45 employees at the Hughes Landing facility in Montgomery County was placed on the Texas Workforce Commission website Dec. 2, the report said. The global conduct of ExxonMobil is of increasing interest to Guyanese stakeholders as questions have arisen here on a wide range of concerns including the lopsided 2016 Production Sharing Agreement, the application of local content and the fact that the company and its partners will not be paying any tax here.
