NEW ORLEANS (WGNO) –– The New Orleans City Council is considering a proposal to grant Shell Oil a 15-year property tax exemption, part of the company’s Payment in Lieu of Taxes, or PILOT, application. However, this proposal is facing opposition from housing advocates.
A PILOT agreement lets a company make alternative payments instead of traditional property taxes, often to spur development or maintain a business presence in a community. The proposal is centered around Shell relocating its Gulf of Mexico operations headquarters to a new 142,000-square-foot office in the River District neighborhood.
The River District is planned as a 39-acre mixed-use development to connect key city areas with the riverfront and the Ernest N. Morial Convention Center. Developers expect the project to generate more than $43 million in annual tax revenue and contribute over $1 billion in economic activity to the region.
The Office of Economic Development recommended the project to the City Council, stating it would bring significant fiscal benefits. Over a 20-year period, the city would see a net fiscal benefit of $37.6 million, while the state would gain $238.7 million.
Andreanecia Morris, president of the Greater New Orleans Housing Authority, strongly opposed the proposal. She criticized the approach as favoring corporate interests over the immediate needs of New Orleans residents, citing rising living costs impacting homeowners and renters.
Morris also questioned the commitment to affordable housing in the River District project. The Housing Alliance withdrew its support from the River District, citing insufficient focus on affordable housing and rapid advancement of projects like the Shell Oil building and a new TopGolf driving range.
The city council is also slated to discuss an ordinance adjusting millage rates, a critical factor in determining property taxes. The move comes as homeowners are already feeling anxious about rising property costs.
Morris challenged the rationale of offering tax relief to a profitable company while residents struggle with financial burdens. “What are the people of New Orleans going to get today to help them? Because we know what Shell is going to get today,” she said.
Housing advocates have reached out to council members via email to express their concerns. Morris hopes the council will respond by prioritizing the needs of the residents. ‘We’re hoping that the council will hear us, make changes, make immediate plans to ensure that when we make these kinds of investments, the people’s needs are being met first,’ Morris said.
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