BATON ROUGE - The Louisiana Quality of Life Campaign, sponsored by Louisiana Environmental Action Network (LEAN), awarded its first Corporate Hog at the Trough Award on Thursday to Exxon-Mobil Corp. in East Baton Rouge Parish.
The Corporate Hog at the Trough Award is awarded monthly to big businesses that take the most in corporate welfare dollars and give back the least to their communities. Exxon-Mobil receives this month's award because it has three hogs at the trough - Exxon and Exxon-Mobil (Chemical) Exxon and Exxon-Mobil (Refinery) and Exxon and Exxon-Mobil (Plastics). These fat little piggies took a combined $286,613,758 in corporate welfare through the ten-year industrial tax exemption for the past ten years, created only 95 permanent jobs at a cost of $3,016,986.93 per job. Exxon-Mobil avoided $103,180,952.88 in local school taxes in East Baton Rouge Parish. LEAN members delivered the Corporate Hog at the Trough Award - a soft stuffed animal pig stuck in a trough full of dollars- to Exxon headquarters on Thursday to Plant Manager Tom Moeller.
"Considering the fact that our state was recently suffering from a $600 million budget deficit, Exxon-Mobil should be embarrassed for taking $286 million from the state taxpayers and providing less than 100 permanent jobs in return over an entire decade," Marylee Orr, executive director of LEAN said. "And the rest of the corporations in Louisiana which take $300 million from the taxpayers every year should be ashamed as well."
By the end of this year, Exxon and Exxon-Mobil Chemical will have received $121,624,968 in estimated tax relief since 1990. In return, Exxon and Exxon-Mobil (Chemical) created 41 jobs at a cost of $2,966,462.87 per job. Exxon and Exxon-Mobil (Chemical) was able to avoid an estimated $43,784,992.08 in local school taxes.
Exxon and Exxon-Mobil (Refinery) had its time at the trough as well. Exxon and Exxon-Mobil (Refinery) has received $143,694,613 in corporate welfare, while creating only 11 jobs at a cost of $13,063,146.64 (yes, that's $13 million) per job. Exxon and Exxon-Mobil (Refinery) avoided $51,730,060.68 in local school taxes. Exxon and Exxon-Mobil (Plastics) took $21,294,177 in corporate welfare while creating 43 jobs at a cost of $495,213.42 per job. The company's plastic division avoided $7,665,903.72 in local school taxes.
"If I were a small business owner and I find out about this I would be mad," Orr said. "Small businesses pay property taxes that are spent on the services they use such as roads, water and sewerage systems, fire and police protection and our schools. Small businesses create about 60 percent of all new jobs in our state's work force, but they don't receive massive tax breaks. In contrast, big business creates only 10 percent of all new jobs but uses public services more than anyone. And yet, big business receives $300 million in corporate welfare annually and pays no school tax. This means that small businesses are paying more than they should because big business doesn't pay what they should. A small printing company with less than 20 employees pays more school tax than Exxon does when it is enjoying 10-year industrial tax exemptions."
In addition to failing to create jobs in return for the welfare handouts, Exxon-Mobil's various companies belched out 126,031,214 pounds in toxic emissions between 1987 and 1997 in East Baton Rouge Parish. In 1997, Exxon had 8,333,586 pounds in emissions and total wastes of 71,678,801 pounds. Exxon-Mobil was recently designated by the Environmental Protection Agency (EPA) Region 6 in Dallas as one of eleven sites in a five-state area that is responsible for the most accidental emissions.
Keeping Exxon's numbers in mind, Orr said, it's important to point out that air pollution is responsible for 500 deaths annually in Louisiana and the health-related economic costs due to air pollution range between $2 billion and $7 billion each year. As a result, each citizen of Louisiana pays $1,000 in additional health care costs due to air pollution. Obviously, the death and illnesses rob the economy of jobs and takes away income from households.
With regard to the impact corporate welfare programs have on economic development, the argument by big business is that the incentives create and retain jobs for the state. However, the numbers don't bear this out. In 1998, companies were given $300 million in taxpayers' dollars but created only 6,250 jobs. That means the state paid $48,000 a job. Orr posed the question, "Why should the state ever pay more for a job than what it's worth? Paying millions of dollars per job to Exxon-Mobil is crazy and it doesn't make good business sense considering the return we are getting on our investment." Even more telling is that between 1982 and 1995 the state paid manufacturing big businesses $4 billion in tax breaks and 26,000 jobs were lost. Taxpayers paid $154,000 for each job lost.
"Why should three percent of the companies in this state be paid this outrageous amount of money to create only 10 percent of the jobs?" Orr asked "That's a question we will be asking publicly during the Louisiana Quality of Life Campaign until we get an answer or until something changes."
Orr said the tax breaks actually end up in deterring businesses from Louisiana. When companies look at the condition of roads, public schools and public services - all under funded because big business doesn't pay its fair share - companies hesitate to locate here.
"We must improve the quality of life here, if we are going to attract growth companies here and if we are going to get small businesses to stay," Orr said. "This handful of big businesses damage our quality of life by polluting our and air and water; they don't pay their fair share in taxes; they don't even deliver the jobs and payrolls they promise and then they come back and ask for more. It's time to say enough."
Orr said she hopes to use the Corporate Hog at the Trough Award as a vehicle to educate the public and encourage corporate accountability. Orr explained that to get the tax breaks big businesses simply fill out a one-page form that projects the number of jobs and payrolls the businesses might create. Not one single state agency follows up to see how many jobs were created and big businesses isn't required to actually create the jobs and payrolls it promised in order to receive the tax breaks.
"Last year, Senator Mike Robichaux tried to pass a bill that would require companies to report how many jobs were actually created after tax breaks were granted," Orr said. "The bill wasn't going to penalize big businesses if the jobs or payrolls weren't created. It simply required companies to report the number of jobs that would be created. The big business lobbyists shut it down pronto. It seems to me if this program were so successful and beneficial, big business would want the numbers to be made public. Maybe it's not as successful as they would have us believe."
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