NEXUS asks to pay less in pipeline taxes, again

NEXUS Gas Transmission has filed another property tax appeal, asking Lorain County to accept $3.6 million from its new pipeline instead of the $9.5 million it once promised. The request has Lorain County Auditor Craig Snodgrass furious. "They promised everybody the world," he said in a phone interview Wednesday. "... They sold everybody a bill of goods on how to get a foot in the door to each county, and now they've reneged." NEXUS has made three attempts since November to reduce the tax amount it is required to pay for the 21-mile stretch of pipeline that runs east and west through the county. Now the total is down by 62 percent. Snodgrass called the appeals "a shell game" and "a bait and switch," and said the public should be outraged. The state tax commission is expected to rule on the appeal by the end of June. Under current Ohio law, NEXUS can appeal again and again — there is no legal cap, according to Robert Rinehart. He serves as both treasurer of the Oberlin Schools and vice chair of the new Ohio Schools Pipeline Coalition, which represents 39 school districts. Its purpose is to lobby for public utilities policy reform. Rinehart said companies like NEXUS have deep pockets, and he expects a fourth appeal to come next year. The pipeline was a $2 billion project. It stretches 255 miles, transporting natural gas from eastern Ohio through Michigan to Canada. First proposed in 2014, the project received Federal Energy Regulatory Commission approval in August 2017, but not without legal fights from cities and homeowners in its path. Despite protests and lingering legal action, the NEXUS pipeline went operational in 2018. Rinehart said the company's appeals have in part been based on cost overruns from the project. That's not an acceptable excuse in his eyes. "All the numbers come from them," he said. "They made all the estimates. They did all the budgeting. ... Cost overruns are a part of the project. That's what you're valued at. If you have a cost overrun on a building, that's part of the value of the building." Snodgrass agreed. He said he is not surprised by the NEXUS appeals, because historically public utilities companies have oversold the tax values of their projects. "Just pay what you owe. Just be fair about things," he said. Local school districts on the pipeline's path stand to lose big money if the appeals go through: • Firelands would get $741,585 less than originally estimated.• Keystone would get $1,024,376 less.• Midview would get $988,384 less.• Oberlin would get $1,198,435 less.• The Lorain County Joint Vocational School would get $167,817 less.Townships also would get far from what was originally touted:• Camden would get $97,635 less.• Grafton would get $141,956 less.• LaGrange would get $128,269 less.• New Russia would get $17,320 less.• Pittsfield would get $51,713 less.Other local governments that would not receive the amount NEXUS touted:• Lorain County would get $1,033,070 less.• Oberlin would get $11,193 less.• Kipton would get $32,618 less.• The Central Ambulance District would get $37,275 less.• The Wellington Fire District would get $28,442 less.• Lorain County Public Health would get $34,248 less.• The Grafton-Midview Public Library would get $22,867 less.• The Elyria Public Library would get $49,813 less.• The Oberlin Public Library would get $88,863 less. The total tax amount the county would not receive under the NEXUS appeal: just shy of $5.9 million. For the Oberlin Schools, NEXUS money has long been eyed as a way to pay for a second new school, in addition to the prekindergarten- through fifth -rade building under construction now. Rinehart said the "very aggressive" tax reduction sought in the appeal would almost certainly delay a new high school. And in Camden Township, the reduced amount would put a dent in plans to build a new fire station, Snodgrass said. Firelands Superintendent Mike Von Gunten said he never expected NEXUS to live up to what it advertised. "It's always been a little bit of a wild card if we could ever count on seeing that money," he said. "Like many other things in life, when it sounds too good to be true, sometimes that's just how it turns out." Firelands' share was never worked into a construction budget; instead, Von Gunten said whatever windfall goes his way will be used to help with operating costs. The tax commission won't necessarily bow to NEXUS' appeal request, however. Rinehart said he believes there will be some form of compromise. "I think the tax commission is going to rule in our favor, but how high they go is the question," he said. On its website, NEXUS Gas Transmission estimates the pipeline's value to Ohio at $390 million in local tax revenues for the first five years, with $116 million to local school districts. It also contends the pipeline creates 5,325 jobs and $565 million in wages statewide. Contact Jason Hawk at (440) 329-7122 or news@lcnewspapers.com.