A $21.6M tax break for developers of Shell Oil's new building in the River District appears to have broken state law because it was approved by the New Orleans City Council too hastily, according to the council's executive lawyer Adam Swensek.
The City Council voted 5-1 to approve the payment-in-lieu-of-taxes measure on Dec. 1 exempting developers of a new Shell Oil building on the 50-acre property from paying property taxes for 15 years, among other incentives.
Shell, which runs its global offshore operations from New Orleans, is one of the anchor tenants for the $1B River District Neighborhood on property owned by the Ernest N. Morial Convention Center.
In a presentation to the City Council's economic development committee on Nov. 27, the developers and administration officials argued the tax break is necessary to persuade Shell to keep a significant presence in New Orleans.
On Dec. 7, Swensek wrote in a memo to Council President Helena Moreno and circulated to the council that the tax break approval may not comply with a new state law because it hadn't allowed sufficient time (15 days) to consider implications.
He also noted that if there were challenges to the tax break, it could potentially but could make the city legally vulnerable.
That term refers to the possibility that agencies dependent on city tax collection, such as the School Board, Sheriff's Office and/or others could potentially take legal action over revenue lost to the tax break, according to a City Council aide who wasn't authorized to speak publicly. (NOLA.com 12/08/23) Vote on Shell tax break in New Orleans may have broken law | Business News | nola.com
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