Stark County denies tax break for oil-based businessStark County Commission members made it clear they will not be giving tax breaks in the oil patch after they rejected a second request from an oil-based business Tuesday morning.
By: Klark Byrd, The Dickinson Press
Stark County Commission members made it clear they will not be giving tax breaks in the oil patch after they rejected a second request from an oil-based business Tuesday morning.
EDOG Logistics, LLC, of Wichita, Kan., had submitted a request in June for a 100-percent five-year tax exemption which was denied. At Tuesday’s meeting the company was looking for any available incentive.
“When you start up a business, it doesn’t take off like an airplane,” EDOG Project Manager John C. Wadsworth said, adding the business did not expect 100 percent exemption, and would appreciate any break to get the $20 million project started.
Stark County Tax Director Diane Brines said the company would be expected to pay more than $250,000 per year in taxes.
“We think we are bringing a lot to this county,” Wadsworth said, adding that there would be $1.3 million spent on construction of a facility to load crude oil in to train cars. The facility would employ 13 people with combined salary of about $780,000, Wadsworth said.
Commission Chairman Ken Zander said there are many large oil-development projects that are underway, or soon to be underway that have been able get going without tax incentives.
“My fear is that by allowing an exemption here we clearly set a precedent to the oil industry to step up to the plate and ask for exemption and it will be given,” he said. “And we just can’t do that.”
Zander said allowing the exemption would be taking money from other taxing entities in the county.
“It impacts senior citizens, the jails, the schools, the libraries,” he said, citing a report prepared by Brines.
A letter from the South Heart Public School signed by Superintendent Riley Mattson was presented in opposition of the project, saying the recent population influx has caused financial hardship and that “tax revenue from new business will help to alleviate the financial strain to our school district.”
Commissioner Jay Elkin said it is difficult to justify an exemption when businesses in the oil and energy sector are enjoying record profits.
Stark County received oil impact funding and it would be inappropriate to give a break to an oil-related business, Commissioner Russ Hoff said.
“Getting money from the state, and then giving tax exemptions back to oil sends the wrong message to our taxpayers,” he said.
Stark County resident Bob Zent was at the meeting and said he supports the decision of the Commission.
After the meeting Wadsworth said the project will carry on, but it may be more difficult to expand. He said his company will not seek any more funding from the county.
“It is obvious the county has made their decision,” he said.