Friday, August 22, 2014
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Price tag for Shell deal gets bigger with cleanup

The $1.65 billion tax deal the Corbett administration is negotiating with Shell Oil to locate an ethane processing plant in western Pennsylvania is shaping up to be the biggest such state investment Pennsylvania history.

Price tag for Shell deal gets bigger with cleanup

The $1.65 billion tax deal the Corbett administration is negotiating with Shell Oil Co. to locate an ethane processing plant in western Pennsylvania is shaping up to be the biggest such state investment Pennsylvania history.

And now it appears, it's just getting bigger.

Under the deal, taxpayers would foot the bill for hazardous materials clean up at the western Pennsylvania site, a cost that could easily soar into the tens of millions, according to a report by CapitolWire news service.

Corbett officials told legislative staff that on top of the $1.65 billion in tax credits over 25 years starting in 2017, and other sweeteners that come with a tax-free Keystone Opportunity Zone, the state would be picking up the bill to clean up the waste from a zinc smelter site.

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Corbett wants ethane-tax credit for Shell

The Horsehead Corp. plant, which is still operating at its Beaver County facility, is a repeat violator of federal clean air and water laws, CapitolWire reports.

News of the deal surrounding the building of a so-called ethane cracker plant, that would convert byproduct of the natural gas industry to plastics, was first reported by CapitolWire on Monday. The plant is expected to create as many as 20,000 jobs, both at the plant and in related industries.

 Sen. Vincent Hughes of Philadelphia, the ranking Democrat on the Appropriations Committee, wrote to Corbett asking for an explanation but so far have received none, he said.

Sen. Daylin Leach (D., Montgomery) wrote his own letter today seeking to find out more specific information such as how much each job would cost Pennsylvania taxpayers and whether there is language in the agreement that would prohibit Shell from demanding more money down the road.

"At a certainly point how much are we payuing for every job?" said Leach today. "If it's $300,000 per job why not just give people the money?"

George Jugovic, former western regional director of the DEP, now head of the environmental group PennFuture, told CapitolWire the site is a "wasteland."

“There are so many environmental issues on that site: groundwater issues, surface water issues, waste disposal issues, discharge into the water issues,," he said.

The state Hazardous Sites Cleanup Act requires that Horsehead pay first for the clean-up, Jugovic, adding that he thought legislation would be needed to change that mandate.

“I never heard of the state picking up the cost when there is a company that was still in business and left a site that needed clean-up,” Jugovic said.

 “It just further points out the questionable nature of this deal. How could anyone put the public on the hook for undetermined cost for a clean-up of one of the dirtiest industries there is? Why make the taxpayers accountable, not the company who put the site in this condition?”

 

 

 

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About this blog

Commonwealth Confidential gives you regularly updated coverage of the state legislature, the governor and the workings of the state bureaucracy. It is written by Angela Couloumbis and Amy Worden in the Inquirer's Harrisburg bureau, based right in the statehouse, and by the newspaper's far-flung campaign reporters.



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