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Study warns of tax loss if Chesapeake allows ethanol plant

Posted to: Environment

By Meghan Hoyer and Mike Saewitz
The Virginian-Pilot

PORTSMOUTH

On the eve of a vote by the Chesapeake City Council, Portsmouth officials have released a study showing that Chesapeake could lose millions of dollars in tax revenue if it approves plans tonight for one of the world’s largest ethanol plants.

A consulting firm hired by the city of Portsmouth warned last week that the ethanol refinery could hurt housing values within a two-mile radius of the project by anywhere from 8 to 46 percent.

The study by Stokes Environmental of Norfolk predicts that Chesapeake could lose from $1.9 million to $10 million in real estate taxes annually.

The report’s findings were disputed Monday by several Chesapeake officials, including City Manager William Harrell and the developer of the project, who questioned the timing of the report.

International Bio Energy Virginia LLC has proposed a refinery that would produce about 216 million gallons of ethanol on a 97-acre site along the Elizabeth River near the Portsmouth city line.

On Friday, Portsmouth City Manager Kenneth Chandler sent the report to Chesapeake leaders along with a letter asking “is this project worth the risk?”

“What the developer has omitted from their proposal is the potential and significant loss on investment for Chesapeake residential and commercial properties,” Chandler warned.

Portsmouth officials hired Stokes earlier this year to help evaluate the refinery project. Two weeks ago, city leaders asked the firm to conduct a housing value study, Portsmouth Chief of Staff John Maher said.

The city received the numbers late last week and shared them quickly with Chesapeake, he said.

Stokes was asked to run numbers for Chesapeake first, Maher said. The company, which was paid about $2,400 for the work, is still analyzing data to determine what the potential impact could be on Portsmouth neighborhoods, he said.

According to the study, in a best-case scenario, neighborhoods within a mile of the refinery would see a 10 percent decrease in housing values, while neighborhoods within two miles would lose 8 percent of their worth.

In the worst-case projections, houses in neighborhoods closest to the project would lose 46 percent of their value. The projected losses were based on a study of property value decreases in a few Texas communities after ethanol plants were built there, the study shows. The report does not state which Texas communities were analyzed.

The Portsmouth City Council has unanimously voted against the project twice this year, citing concerns about odors, pollution, traffic and safety. But since the ethanol plant would be in Chesapeake, Portsmouth officials have no official say on the project.

Chesapeake Mayor Dalton Edge, who hadn’t seen the Stokes report on Monday morning, said Portsmouth officials will “use any method they can” to express their opposition.

On Monday, Chesapeake officials and companies connected to International Bio Energy Virginia LLC presented a letter from a real estate agent who asserted that property values in Monroe, Wis., rose after an ethanol plant was built in the small rural community.

Rick Starnes, of ITAC Engineers & Constructors, a key player in the ethanol project, said property values here would increase because the refinery’s 150 employees would probably live close to their work.

Besides new jobs, Chesapeake expects the plant would generate at least $2.6 million a year in real estate tax revenue.

Maher said the impact on local cities’ tax streams could be huge, because unlike most ethanol plants built in the rural Midwest, International Bio Energy Virginia’s proposal calls for a refinery within a half-mile of residential neighborhoods.

“All the other plants are in small populated areas,” Maher said. “Here you’ve got a population – there’s 20-plus thousand people within two miles. It’s a whole different magnitude of property.”

Meghan Hoyer, (757) 446-2293,

meghan.hoyer@pilotonline.com

Mike Saewitz, (757) 222-5207,

mike.saewitz@pilotonline.com




City residents must be made aware

We have a serious problem here in Chesapeake and it stems from a City Council infringing on our quality of life, health & safety. Our Taxes have sky rocketed across the board, the former Mayor Ward has far too much say in the direction this City takes and we know that means, $$ for some body, this spend mentality must stop. Only two of our City Council Members have the interest of the people at heart, the rest must be ousted. This Ethanol project is a strain on our Citizens and a travesty for Chesapeake. Our present City Council needs a rude awakening, we must show them we want the right decisions for the people of this beautiful City. Chesapeake can ill affort to continue with projects like this. "It's up to you to vote them out."

Lets Build It

in Southern Chesapeake nearer to the raw materials for producing ethanol. Less cost in transporting corn up to Craddock, more friendly to the environment, less people affected by the odors. Of Course this idea will never fly because council and its developer cronies have plans for subdivisions of McMansions.......

Council will be held accountable

If this City Council and Mayor Edge allow this to go forth, there will be accountability at the polls. Things like this can really bring out disgruntled voters. And local elections depend on community voters turning out to vote. I live within a 2 mile radius of this proposed plant. I voted for Edge for Mayor but he will lose my support, along with everyone on my street, if he votes for this plant. Everyone in Chesapeake should be counted as valuable. If our property values go down where would we afford to move?! And maybe we like where we live! If they neglect and discount us, they will certainly here our voices on election day.

Go Nuclear

Why don't we just build a nuclear reactor on the property? Clean, cheap, proven energy source.

My .02

To the folks in Craddock: You live in an industrial area. Get used to it or move, like I did. The enviro's: Hey it's an alternative "green" fuel (even if it will never work). You can't scream for something, then get your panties in a wad when you get it. To city council: At least this is a real company, unlike the Happy Funball Smiling Earth clown company. Don't make two huge mistakes by voting up on the scam artists, and down on the legit company. Look at it this way. If the ethanol plant goes in, Dalton will have someone to sell his corn to. Then he can stop whining about being just a po' farm boy.

Ethanol is not the answer

Almost all energy experts agree that ethanol is a short term solution that will be phased out in the next ten years in favor of other newly developing technologies. There is no long term benefit to building this proposed behemoth which will outlive it usefulness long before the city ever gains any benefit from it. It will drive up corn prices, making everything else that relies on corn more expensive, and negatively affect everyone. City Council, please use some common sense for a change!!

Heed the warnings

There are so many reasons why this is a bad idea one hardly knows where to start. Hopefully, Chesapeake City Council will have the good sense to heed the warnings of its own Planning Commission, which voted 5-3 to recommend denial of this highly dubious project.

Poor Fit, Lousy Alternative, Neighborhoods at Risk

The push for an ethanol plant in the middle of a beefy population far from the sources of feed stock and clean water is misguided at this point in time and at the chosen location. Ethanol is not the great replacement for petroleum distillates everyone thinks it is. For the proposed plant, more petroleum will be used to get one gallon of ethanol than anyone cares to imagine. Water? Ethanol plants use tremendous quantities of water, much to be lost after use at the plant. Wastes? The solids remaining after refining is used to feed livestock. Again, another tremendous use of fuel to take this waste to a far-distant end-user. The property is question could be better used to relocate antiquated shipyards to state-of-art eco-friendly facility.

Study warns of tax loss if Chesapeake allows ethanol plant

The ethanol industry is linked to air and water pollution, it is linked to deforestation of major rainforests so crops can be turned into ethanol. The National Research Council said cultivating crops for ethanol could harm water quality. The Environmental Protection Agency declared in 2002 most ethanol plants were in violation of clean air rules. Several states with established plants recorded related pollution problems including the release of potentially carcinogenic compounds into the air. The above information in conjunction with the Stokes study predicting the city could lose up to $10 million in taxes annually are significant warnings an ethanol plant is an economical and environmental risk. Chesapeake, heed the signs.

Remind Chesapeake of a NC landfill!

I wonder why something in NC that is offensive to a neighbor is a bad thing but something in Chesapeake that is offensive to Portsmouth in a good thing? You guys might want to ask each Chesapeake Councilor that question.

Portsmouth's nose is where it should be...

To Allyson O. -Va Beach: Well, since you live in Va Beach, not likely you have more say than Portsmouth, to begin with. Secondly, Portsmouth is concerned for our community sake because of the location of this monstrosity & because we were "invited" to participate in discussion on it, thank you. Third, you might want to become a bit more educated on the matter of gas prices, since the location of the plant would have no effect. Perhaps a lesson in economy might enhance your understanding of such things. Next, it is impossible to expect much help in employment when this leviathan would only promise 150 jobs. And finally, it would be far from eco-friendly, as you put it, since it would strain the Elizabeth River & pull mountains of water.

People first, Citizens second

Is this project compatible with the surrounding community and not adversely effect the health, safety or comfort of persons living or working in or driving through the area? It is not compatible. Creating air pollution to reduce other air pollution does not make sense. Not only will the plant produce air pollution, there will be the added emissions from 250 trucks a day, and all the cars waiting behind them. Trucks every 4 to 8 minutes apart non-stop. Having to add another fire station and maintain it "in case" of an "incident". Water we conserve will be used by the plant for "essential" use. This project will ensure for our comfort??? Citizens, regardless of which side of the boundary they live, are people first. Is this compatible? NO

Profit at the cost of children's lives? Shame on you!

55, 000 school children in Portsmouth and Chesapeake, combined, are within a 17.5 mile radius of the proposed ethanol plant. 14,106 students are within 5 miles! Toxic emmissions released into the air bring the dangers much closer than land miles! What is your evacuation plan, Chesapeake? Chesapeake is embarking on a venture that will bring war between two cities, just as war has developed between small countries over oil. My home is less than one mile from the proposed site. The good council members of Portsmouth are looking out for its citizens. Chesapeake Council is courting danger. Shame on EX Mayor-Ward for convorting with IBE, LLC! You have wiped away any merit and credibility you ever earned as Mayor! Lawyer-up, Chesapeake!

Put it in Va Beach!

To those who are so eager to have this pollution monster built on the Chesapeake/Portsmouth border....and who don't live anywhere near the affected area....how about we put it on the Lynnhaven instead?

Chesapeak residents demand a NO vote

Portsmouth has every right to conduct the study. This plant is in Ports. back yard right across the street from Cradock!!! The plant traffic will be using Ports. roads & affecting Ports. neighborhoods. All the tax income generated by this plant will go to Ches. None of it will be used to repair Victory blvd. where 250 trucks trips a day will be traveling to get to the plant. That is 1,705 additional trucks trips a week going past our homes. Those in Norfolk and VA beach, lets add that many semitrucks to your road and see if you will be able to sell your home. I should not have to move so Ches. can get a few tax dollars in there pocket. Ches. residents demand that your council votes no! portect your health, home, family & quality of life

Tax Revenue Loss for Numerous Cities

This proposed plant may affect the air quality of neighboring communities and cities - downtown Norfolk may be affected - cruise ships, Met Park, MacArthur Center - Virginia Beach could very well be affected. This is NOT just a Chesapeake problem. How many more reasons does Chesapeake need to vote NO on Tuesday night, Nov 20th. If you are concerned you should attend. Don't let this become a reality and then regret that you did not take a stand.

The Losers Game of Ethanol Production

Vera Sun Energy, one of the largest and most respected bio-fuels company in the U.S. has stopped construction on one of its plants due to the glut of ethanol. Plants in Iowa,Minnesota,South Dakota have stopped construction for the same reasons. According to the Renewable Fuels Association in Washington, projects are being shelved nation wide. Chesapeake would be foolish to be involved with an ethanol plant at this time. The majority of our city council, just want another ribbon cutting ceremony for something. If they think this plant will be around for more than two years, I have a bridge to sell them. Where is the leadership in Chesapeake. I hope drug dealers are not the owners of this plant. May08' clean sweep city hall.. It's shameful.

Say no to ethanol

We live in the city of Portsmouth less than a mile from the proposed plant site. We have been told that we will hear tons of trucks and have to deal with smells and pollution. We are also being told that this will affect our property values greatly. No one will want to live next to that smell. We also will probaly not be able to sell our homes because of all of the problems from the plant. We are hoping they will not approve this plant for the health and safety of our neighborhood. We are neighborhood fighting to come back and be a nice place to live. I and my 8 year old nephew have asthma and we will not be able to live with the smell. We don't want to move, my great grandfather built my house, we love our home! Please say No!

The public speaks

The surrounding communites in Chesapeake, and our good neighbors in Portsmouth are so opposed to this proposal. Our quality of life, health, safety, and property values are at stake here. The good council members should not allow a behemoth to suck in 1.2 million gallons of water per day, and ask us to conserve. Tell them to vote "no" to ethanol located in an urban area.

Curious what difference the actual value of the property will

relative to taxes property taxes collected. All over this area there are homes languishing on the market for sales well below thier assessed values. Actual value means nothing relative to taxes here regardless of what the law says. Research it yourself. Start in Lochhaven in Norfolk, then look at Ghent, Riverview, etc. Homes on the market priced over $100,000 below assessed value. Obviously if the assessed value was correct, they would have been sold long ago. As home values plummeted last year and I got a 21% increase in assessed value. Go forward without worry Chesapeake. You will still have the license to steal until citizens revolt against this unlawful practice.

It's really a shame......

Here we have an opportunity to do something about the gas prices and being more eco-friendly. What's Portsmouth doing spending money on a study about Chesapeake when they need to worry about their school system, crime rates, etc. Have they ever thought that the people working this plant might live on the Portsmouth side, boosting Portsmouth's economy? It can't be any worse than the area of Metro Machine, Norfolk Naval Shipyard in Portsmouth and all along that area. Worry about what's in your own yard, Portsmouth, before you stick your nose in your neighbor's yard.

Skeptical

As skeptical as the Pilot normally is, I hope they are just as skeptical on this supposed "consultant's report". Please verify that they conducted a true "apples vs apples" comparison. If this report is the same one Portsmouth has had since summer, it is totally irrelevant because it compares home values adjacent to a petroleum refinery out in Texas, which is a totally different animal from the proposed ethanol project.

Of course, this is probably just another in a long line of continued disinformation that has come from opponents of this project.


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