State officials renewed a tax incentive agreement last week with a company that announced plans to build a gas-to-liquids facility in Floyd County, but this week, Judge-Executive Robbie Williams reported that the fiscal court is out of the gas-to-liquids business, at least for now.
In an interview with the Appalachian News-Express on Wednesday, Williams said he informed officials at RCC Big Shoal that “they have some loose ends to tie up” before the Floyd County Fiscal Court will back the company’s plans to build a gas-to-liquids facility near the Markwest processing facility in Langley.
“I spoke with the folks from RCC Big Shoal a couple times, approximately six weeks ago, in which they expressed interest to us in moving forward,” Williams told the News-Express. “But, I told them that we (Floyd County) would not be supporting the project in any way until this issue with Pike County was cleared up.”
Aug. 28 marked five years that have passed since the Kentucky Economic Development Finance Authority gave preliminary approval for $18 million in incentives for RCC Big Shoal LLC to build a gas-to-liquids facility in Pike County. The preliminary approval came about six months after RCC Big Shoal registered as a business in Kentucky, and the KEDFA renewed that incentive agreement for another 12 months on Aug. 29.
The incentives, made available through the Incentives for Energy Independence Act, were set to spur the development of a gas-to-liquids facility in Pike County that, in 2014, was reported to have a total cost of $193 million. The cabinet reported the company would provide 30 jobs with an average pay of $34 per hour.
RCC Big Shoal and its parent company, RCL Chemical Conversion, however, announced the project would move, instead, to Floyd County, leaving Pike County officials concerned about a $400,000 loan Pike County provided to kickstart the project. Pike County filed a lawsuit against RCC Big Shoal this year, seeking repayment of that loan, and, the News-Express reported, the company’s attorney asked the Pike County Fiscal Court to drop the lawsuit this week. Fiscal court members did not agree.
“This is a defunct, penniless organization that can raise the money if the lawsuit is taken off the record,” attorney Larry Webster said.
He claimed that if Pike County did not drop the lawsuit, that they “may not get another penny” and that they “have also taken away Floyd County’s chance of getting a plant put down there…,” the News-Express reported.
Pike County Judge-Executive Ray Jones told the News-Express that he believes the Floyd County project has “no chance of getting off the ground.”
The Floyd County Fiscal Court has not addressed the RCC Big Shoal project publicly since Williams was sworn into office in January. He told the News-Express that the Floyd County Fiscal Court believes there are some “credibility issues” with RCC Big Shoal and that officials don’t like the optics of partnering with a company that has a pending lawsuit and loan in a neighboring county.
“I told them once this is settled in Pike County, we’d be more than happy to sit down and discuss moving forward,” he said. “We certainly want to look at any and all businesses that want to locate in Floyd County, but we certainly think they have some loose ends to tie up.”
No taxpayer funds in Floyd County have been allotted for this project, but years ago, the Floyd County Fiscal Court approved serving as a pass-through agent for a $100,000 K-PEGG grant that Kentucky Power awarded to RCC Big Shoal for site development. Former Judge-Executive Ben Hale said the project could “change the landscape” of the coal economy.
Officials with the KEDFA reported that the incentives offered to RCC Big Shoal will not be paid unless the project comes to fruition.
The project, however, has received some funding.
In addition to the $400,000 that RCC Big Shoal received from the Pike County Fiscal Court for the project and the $100,000 grant provided by the Floyd County Fiscal Court, RCC Big Shoal also received, in 2012, a $250,000 grant for research and development from the Kentucky Science & Technology Corporation in Lexington. That agency studied the project prior to the preliminary approval for the incentives, and reported that it met all requirements to receive those incentives, KEDFA documents show.
Bill Johnson of RCC Big Shoal told the Floyd County Chronicle and Times in 2017 that the facility will be built off site and moved to the property in Langley, reporting that the company would seek local contractors for the work.
“We’re looking forward to being a permanent resident in the Eastern Kentucky area,” he said.
RCC Big Shoal has not leased property in Floyd County or obtained permits to build the facility, officials report.