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Providence’s $1 Million Tax Increase Causes Teppco to Close—36 Jobs Lost

Thursday, March 24, 2016

 

Nearly one year after being hit with a $1 million tax hike by the City of Providence, Teppco, a propane terminal located at ProvPort, has officially closed its doors. The company will cease doing business in Providence this week -- a move that will cause its 36 employees to look for new jobs.

According to sources with the company and at the Port, the City’s tax increase was the major cause of the closure of the facility that has been operating since 1971. Moreover, the failure by city officials to respond and work to resolve the issues caused Teppco to lose a potential buyer that would have allowed the facility to continue to operate and retain jobs.

Effort to Get a Response from the City

As GoLocal reported on February 26, “The million dollar tax hike was frustrating enough. But what's frustrated Teppco officials [is] the lack of communication. The city, Marino said, has ducked correspondence with Teppco for months."

"After about 12 informal requests for information from the city's assessor's office for information on this issue, I was forced to make a formal public records request with the city," said Michael Marino, Teppco’s attorney last month. "Until [this] morning, the tax assessor's office has outright ignored every request for information that we have made."

The propane terminal has packed up and moved most of its equipment from the premises. Teppco is owned by Enterprise Products, located in Houston, Texas. A spokesman from the company was unreachable for comment yesterday. 

Now Closed - Mothballed

When the potential sale recently collapsed, Enterprise Products decided to simply close down its operations.

Sources at the company and also at ProvPort (where Teppco was located) confirmed to GoLocal on Wednesday that the company was shutting down its Providence operation. The company has notified the US Coast Guard about its intention to mothball the facility, that satisfies federal safety regulations.

It's unclear what will become of the massive tank and facility located on the property of ProvPort that was used by Teppco.

The move follow the highly contentious dispute over taxes between the company and the city. In 2014, the company paid $252,730 in property and tangible taxes to the City of Providence. 

$1 million Increase

As GoLocal originally reported, the company was assessed and billed $1.2 million in taxes (SEE TAX SCHEDULE BELOW) which represented an almost 400-percent increase. 

Marino was unreachable for comment for this story. His secretary said he was out of the country.

But he told GoLocal last month that he was blown off just about every time he sought answers about the issue. That left him guessing and hypothesizing as to what the rationale behind the tax hike was. Marino wondered where the mistake was made. He assumed the tank had been improperly classified, but even that wouldn't account for such a massive tax hike, he said. He also believes the company was taxed twice for the same tank.

"The fact that they have classified it as tangible is bad conduct. But the fact that they're taxing it twice is the worst conduct,"  said Marino.

Marino had made it clear that the company would not pay the 2015 assessment and would fight the bill all the way into court, if need be.

City officials have neglected to comment on this issue as well, citing the fact that the company was going through the appeals process. 

 

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