Sunoco improvements net $5M more in new taxes
UPPER CHICHESTER » It’s not often that a tax increase is applauded — but it was on Thursday.
That’s when representatives from Energy Transfer Partners’ subsidiary, Sunoco Partners, joined local officials to announce an agreement for a reassessment for the Marcus Hook Industrial Complex. The improvements made there that will net the Chichester School District, Delaware County and Marcus Hook an additional $4.8 million in property taxes.
“In a way, this is a moment that we’ve really looked forward to,” Hank Alexander, senior vice president, business development for Energy Transfer Partners/Sunoco Partners, said. “That may seem odd for me to say, considering we’re celebrating Sunoco’s tax bill just increased by 200 percent ... Today’s announcement is much more than taxes, however. It’s about growing Delaware County’s economy. It’s about taking a troubled place and making it more valuable than it ever was.”
The taxing authorities and the company agreed last week that the new assessment for the industrial property will be $114 million. It had previously been $32 million, according to company officials.
In the new allocation, Sunoco Partners will pay an additional $3.3 million to the Chichester School District; a $1 million increase to Delaware County; and a $455,900 hike to Marcus Hook.
Officials from the taxing entities were pleased.
“The school district welcomes the additional revenue and thanks Sunoco for that,” Ruth Ann Baiocco, president of the Chichester School Board, said.
The Chichester School District teaches 3,400 students in six schools and has a budget of approximately $72 million.
“School districts face a lot of challenges these days in the budget effort,” Baiocco said. “The additional revenue that will be generated as a result of the increase in the tax assessment for Sunoco’s Marcus Hook plant will assist the school district in its responsibility to meet those challenges and continue to be fiscally responsible.”
Marcus Hook Borough Manager Andrew Weldon spoke to the sustainability that this will provide.
“The borough is happy that this facility has been repurposed and that the new jobs are coming back to Marcus Hook and obviously the result of this tax assessment increase,” he said. “It’s our hope that the Mariner East 2 pipeline is completed. This will result in more jobs to the borough and afford our residents additional job opportunities as they have in the past.”
Paul Mullen, business manager of IBEW Local 654, said about 500 of their electricians logged about 1 million hours over the last four years helping to rebuild the Marcus Hook Industrial Complex.
“For us,” he said, “it’s gratifying to see something we built bring permanent revenue to the kids in our community.”
Both governmental and company officials spoke of the uncertainty that was prevalent when the refinery was shut six years ago and hundreds lost their jobs.
“In 2011, we were worried about keeping the lights on,” Alexander said. “We lost 500 jobs ... and the parking lot was empty. It was a depressing sight.”
He shared the situation they faced.
“We were so concerned,” Alexander said. “We had all this infrastructure and all these facilities and a skilled workforce and know-how without much to do because we were challenged as a refining system.”
He said they then saw opportunity.
“You’ve got underground caverns that can store the material,” Alexander said. “You’ve got a distribution network second to none because of the proximity to rail and interstate corridors and pipeline networks that are already existing. It just made so much sense and it’s a win-win for everyone.”
With 5,000 workers over more than nine million hours, improvements were made to the site to transform it to accommodate the natural gas liquids industry. Six tanks storing approximately three million barrels of propane, ethane and butane receive materials through pipeline from the Marcellus Shale and another 2 million barrels can be stored in the underground caverns.
The site first received propane in January 2015 and now ships about 70,000 barrels a day of propane and ethane to customers here and around the world.
“We used to take foreign crude oil, bring it to Marcus Hook on ships, refine it in the refinery and distribute all those fuels,” Alexander said. “We now take homegrown clean burning natural gas liquids from our own state, bring them ... to our facility and distribute them locally, regionally and internationally.”
And, this effort is now reaping more tangible results for the community. “Today is a milepost for the Mariner East project,” Alexander said. “For me, it’s the payoff for revitalizing the Marcus Hook plant and the promise of what we have been doing – trying to bring the economic benefits of this state’s natural gas boom to Southeastern Pennsylvania ... This is how you build your economy. This is how you build your communities and this is how we prosper together – and we think this is only the beginning.”