Air Products Seeks 20-Year Tax Deal for Hydrogen Production Plant

By Andy Gardner.

MASSENA – The company proposing to establish a green hydrogen facility in Massena wants a 20-year tax break.

Air Products and Chemicals are seeking two-decade payment in lieu of taxes (PILOT) agreement. Company officials are pursuing this PILOT agreement through the St. Lawrence County Industrial Development Agency, according to its CEO, Patrick Kelly.

Kelly recently provided an update to the Massena Central School Board of Education regarding this proposed PILOT adjustment. In a standard 10-year PILOT program facilitated by the IDA, a company doesn’t pay new taxes for the initial five years, followed by a payment of 50% of what would have been owed without IDA involvement during the subsequent five years. Over this decade-long period, companies benefit from a 75% tax reduction on new investments.

While a 10-year PILOT is the norm, any deviation from this standard necessitates final approval from all taxing entities where the project is located, including the school district and other taxing agents. Kelly explained that when the IDA departs from the 10-year standard, a process is triggered, requiring approval from school districts, towns, and sometimes a village, depending on the project’s location.

“These are broadly speaking the terms and conditions, and we are seeking the taxing jurisdiction board to pass a consent resolution, essentially affirming and agreeing to the broad terms of the PILOT,” Kelly said.

Currently, the county has approximately 40 active PILOT agreements, with roughly half having received approval for deviations from the standard 10-year PILOT. Kelly noted that some of these projects are situated in the Massena Industrial Park, albeit on a smaller scale.

He outlined the procedural steps required for the deviation from the standard PILOT structure, including approval from the board of education, followed by a public hearing in Massena. Subsequently, a resolution would be presented before the IDA board for a vote to approve or disallow the deviation.

Officials expressed enthusiasm for the potential project, highlighting how it aligns with the IDA’s objectives of attracting new business to the northern region.

“The county has a comprehensive economic development strategy that has five key goals, one of which is the promotion of the area and attraction of new investment, new firms,” Kelly said.

He further explained that this goal encompasses utilizing the region’s resources, such as its low-cost, renewable energy, abundant water resources, and access to a skilled workforce, colleges, and universities.

Earlier this year, Air Products officials presented the project to Massena town officials, revealing plans for a $500 million facility spanning more than 84 acres on Pontoon Bridge Road. The facility is set to receive power from the New York Power Authority under an approved agreement, enabling the production of 35 metric tons of liquid hydrogen daily.

The process of making liquid hydrogen from water usually requires a lot of electricity. Using renewable hydropower from the Moses-Saunders Power Project is expected to minimize what would otherwise be a sizeable carbon footprint.

Initial employment at the facility is anticipated to include 80-100 full-time workers, with potential for expansion in the future. The facility is projected to become operational by the end of 2026.