By a vote of 3-1, Matagorda County Commissioners approved entering into a tax abatement with Lodestar Energy Group in what amounts to a 60 percent tax abatement over the next five years.
Matagorda County Commissioner Precinct 4 Commissioner Charles “Bubba” Frick voted against the measure.
Frick’s precinct is where the proposed business is set to be built in admitted during the public hearing on the measure that he was against the tax abatement for the company.
“I’m not for it at all,” Frick said. “The way I look at it you should have to pay you way into this county. Come on in and I will come out and shake your hand and welcome you to the county. I don’t like that these businesses hold these tax abatements over our heads.”
The abatement will grant a declining tax abatement beginning Jan. 1, 2021 and continue to a total of five years. For years one, two and three, the county will grant Lodestar Energy a 75 percent abatement of property tax on the property tax on the improvement’s additions and rail infrastructure and yard improvements.
The base year value of $84,130 as the real property is farmland and was owned by Robert and Tammy Binkley.
In year four, the abatement percentage will be 50 percent and in year five of the agreement, the abatement percentage will be 25 percent.
Lodestar Energy Group is a stand-alone business and will construct a rail served facility in Matagorda County for loading and unloading tank cars containing light hydrocarbons for midstream and petrochemical customers.
The firm estimates in an initial capital investment of $23 million in the facility, equipment and land with a total project cost of $32 million. The facility will have 10 permanent workers with an average annual salary of $85,000.
Lodestar Energy Group estimates breaking ground in the Elmaton area on the project in the first half of 2020 and be fully operational in the second quarter of 2021.
“We have been discussing this project numerous times in the past several months,” said Matagorda County Judge Pro-Tem Kent Pollard. “It will take up some farmland with a small tax base and turn it into a large tax base which will benefit the entire county.”
According to Consultant Steven Manchester, Lodestar Energy is looking to place a $32 million-dollar investment into a site in Matagorda County that would employ 10 full-time workers.
“We believe we would be a great addition to this community,” Manchester said. “But we also realize that this needs to be a win-win for everybody.”
Lodestar Energy Group announced that a 227-acre site in El Maton had been chosen as a finalist location to build the South Texas Rail Terminal.
Matagorda County EDC Executive Director Mike Ferdinand said that the addition of Lodestar Energy will be a major boon for the county and its existing business climate.
Ferdinand said an economic impact study is in the process of being completed and will be presented to county commissioners at a later date.
“This will be a great addition to our county it is not only a clean project but it will add quality jobs to our economy as well. They will primarily use rail to transport their fuels to their proposed project site,” Ferdinand said.
“Our 227-acre terminal will be handling energy-related products resulting from the Texas Gulf Coast’s oil and gas exploration as well as its midstream and downstream manufacturing activities,” according to a letter to Commissioners from Lodestar’s President and CEO Brad Howell. “Initially, Lodestar’s South Texas Terminal will be focused on handling inbound and outbound rail traffic resulting from separate fractionation and storage facilities being considered in and around Matagorda County.”
The South Texas Rail Terminal will be a $32 million investment creating about 10 full time jobs. Positions employed at the facility will include field operators for loading, tank car movement and ancillary tasks earning about $60,000 annually; shift supervisors earning about $100,000; and a manager earning about $150,000.