GARYVILLE — St. John the Baptist Parish government, public schools and law enforcement could be impacted by a potential $14.6 million cut to projected tax revenue in 2020, Parish officials said.

Marathon Petroleum Company’s 10-year tax exemption, enacted by state government to promote industry growth, is set to end and mature onto the tax roll in 2020, according to St. John Parish Assessor Lucien Gauff III.

Gauff’s 2018 appraisal of Marathon’s Garyville refinery assigned a fair market value of $2.4 billion, which he said translates to $44.7 million in additional St. John Parish tax revenue in 2020.

Marathon is preparing to file an appeal with the Louisiana Tax Commission after a third party appraisal gave the Garyville Refinery a fair market value of  $1.6 billion, which would reduce 2020 Marathon tax revenue to $30.1 million.

Marathon is expected to file the appeal within the next month, Gauff said, adding his office’s next step is to defend the Parish appraisal before the Tax Commission.

Gauff said the largest difference in the appraisals is that he used a 20-year depreciation table recommended for the petroleum products industry, while Marathon is standing behind a 15-year table recommended for the chemical industry.

“If the appeal goes through, we would lose out on a lot of tax dollars that we can’t afford to give up,” Gauff said. “These are dollars we have been looking forward to coming on our tax roll. Come 2020, everyone’s been banking on them adding so much more revenue to our budget.”

Marathon has been appraised using a 15-year table in past administrations, but the recommendation has since changed, according to Gauff.

Parish President Natalie Robottom said the Marathon appraisal limits projected funds that could be used for flood protection and other capital investment projects.

Under Gauff’s appraisal, St. John the Baptist Parish Government would receive an additional $16.4 million from Marathon, St. John Parish Public Schools would receive an additional $14.1 million from Marathon and the St. John Sheriff’s Office would receive $11.8 million from Marathon in 2020.

If Marathon’s appeal is upheld, 2020 tax revenue dividends would decrease to $11.03 million for Parish government, $9.5 million for public schools and $7.96 million for the Sheriff’s Office.

“For the Parish, that would be a difference of about $5 million, and obviously that is significant,” Robottom said. “Five million in a small municipality can go a long way.

“The assessor has our support. We were aware Marathon was planning to appeal, and that’s within their right. As a member of the community, we would be hard pressed to back an amount that’s less than what the assessor demonstrated as a fair value to the Parish.”

Public Schools Superintendent Kevin George said the School District is planning for additional funding beginning in 2020 and would need to readjust budgeting if the appeal is upheld.

“There is still a lot that has not been decided, but just know we are always looking to take care of our employees and incentivize them to stay here in terms of possible pay raises,” George said. “We’re always looking at upgrades for our schools. Right now, nothing is set in stone, and we’re still going through that process.”

George said the negotiations are a normal part of business, along with the understanding that each party has to fight for what best suits their entity.

“We’ll meet somewhere in the middle,” George said. “There’s no animosity.”

Marathon, which declined a L’OBSERVATEUR interview request, released a statement via Chuck Rice, director of public and state government affairs.

“Marathon Petroleum Company is seeking a fair assessment value of our Garyville refinery for 2018,” the statement said. “A third-party appraisal, which was prepared by an independent, professional appraisal firm and provided to the Parish assessor, supports MPC’s position. Consequently, MPC intends to file an appeal with the Louisiana Tax Commission. It would be premature to discuss the appeal prior to its submission.”