Two school districts in northeast Ashtabula County have approved 15-year tax abatement packages that will assist a $70 million natural gas pipeline construction project scheduled to start next year.
At separate meetings last week, members of the Conneaut and Buckeye Local school boards accepted plans on behalf of RH Energytrans LLC of Erie, Pennsylvania, that would abate 75 percent of the property tax the districts would collect from the project over a 15-year period. Even when the abatement is applied, the districts will still see annual tax revenue gains approaching $100,000, officials said.
At issue is a 30-mile stretch of new pipe that would originate in western Pennsylvania, pass through a portion of Conneaut and end at a location in North Kingsville, said Dennis Holbrook, a company spokesperson. As planned, the 12-inch pipe would be attached to an existing stretch of line, creating a 60-mile transport system, he said.
The new pipe would be evenly split between the two states, Holbrook said.
The purpose of the project is to create a larger volume of natural gas in the area that would assist existing companies and attract new business. A paucity of natural gas volume has been an issue in the area for many years, officials said.
“We would be providing a transportation service for the benefit of Dominion (Energy),” Holbrook said.
Conneaut City Manager James Hockaday whole-heartedly endorsed the project.
“We’ve lost manufacturing jobs over the inadequate natural gas supply,” he said Monday. “This is how you get jobs into Ashtabula County.”
Federal regulatory agencies are studying the program, and approval is expected by early summer 2018, Holbrook said. Construction would begin soon after and be completed before winter of that year.
Some 100 parcels in Ashtabula County and Pennsylvania will be involved in the project, and more than a dozen land agents have been busy negotiating right of way agreements, Holbrook said.
The project had been discussed for quite some time, Holbrook said.
“We’ve talked informally with Dominion Energy Ohio for several years,” he said.
Dominion, in a statement issued late Monday afternoon, welcomed the project.
“The most notable impacts for customers from the development of the Risberg line will be the increase of supply reliability for the area, the ability to enable load growth and the ability to pursue economic development throughout the Ashtabula area,” said Neil Durbin, senior communication specialist.
RH Energytrans, a subsidiary of Emkey Energy of Erie, was created specifically because of the interstate nature of the pipeline project, Holbrook said. RH has already tackled preliminary work associated with the project, including environmental analysis, Holbrook said.
Ohio’s tax code made the pipeline project financially unfeasible without tax abatement, officials said.
But the 25 percent not abated will mean an additional $106,000 annually for Buckeye, Holbrook said.
Jacelynne Miranda, treasurer for the Conneaut Area City Schools district, said that district could see between $100,000 and $125,000. The “big picture” is the overall positive effect the project could have, she said.
The project could result in jobs, bringing more development to the city, which translates into more tax revenue and students for the local school district, Conneaut school officials said.
“We will see growth in the community,” Miranda said.
Diana DiPofi, Conneaut Board of Education president, said Monday that 10-year abatement periods are the norm, but the board was assured a 15-year period “would be able to attract more businesses.”
Greg Myers, Growth Partnership for Ashtabula County executive director, could not immediately be reached for comment Monday. Myers met in executive session with the Conneaut school board last month and spoke briefly during the board’s Wednesday night work session.