In October of 2022, the Odessa Development Corporation (ODC) board approved a nearly two million dollar payout of taxpayer money to Nacero despite Nacero having clearly failed to live up to the terms of the economic development agreement signed in June of 2021.
The contract executed between Nacero and ODC clearly outlined the investment targets – totally over $5.2 billion – that Nacero would be required to meet over the ten year term of the contract. By meeting each of the yearly goals, ODC would award Nacero a $2 million per year economic development grant.
Year one of the contract which would span June 2021 to June 2022 clearly stated a required investment goal in the Penwell Texas project of $100 million dollars.
Following the signing of the 2021 agreement, Nacero purchased acreage from Grow Odessa, an organization with close ties to the Odessa Chamber of Commerce. The Nacero/ODC contract was negotiated by Wes Burnett who was the director of the ODC Economic Development Department and who was also employed by the Odessa Chamber of Commerce.
Shortly after the Nacero contract was signed Burnett announced that he was going to work for Nacero as their area director.
During year one of the agreement, Nacero repeatedly promised that a groundbreaking event was imminent and at one point said they were only waiting to coordinate an event date with Governor Greg Abbott who would be in attendance.
Despite no groundbreaking on the site and the fact that it appears that no substantive work of any kind has occurred on the site and, other than the employment of Burnett no employees in Ector County were hired, Nacero applied for their first incentive payment of two million dollars.
Although the ODC contract clearly defined that in order for Nacero to be eligible for any year one payment that they must invest $100 million dollars into the Penwell project during year one of the contract – which spanned from June 2021 to June 2022 – members of the ODC Board along with then Assistant City Manager Cindy Muncy and then City Attorney Natasha Brooks argued that Nacero should be allowed to count their investments in other cities and other projects toward the $100 million dollar requirement.
ODC Board Member Kris Crow spoke out time and again during the meeting to challenge the idea that under the terms of the contract Nacero should be allowed to count expenses incurred prior to June of 2021 when the ODC contract was signed. A review of the video recording of the meeting shows Crow repeatedly sparring with Muncy and ODC Board member David Boutin over the legality of allowing Nacero to count expenses prior to the start of the ODC contract in June 2021.
Crow also challenged why the $2 million grant request had not been reviewed by the ODC Compliance Committee which would have been standard operating procedure. Ms. Muncy stated that the request hadn’t gone through compliance because “depending on how you interpret the contract” the grant request should just be prorated so it didn’t need to go through the Compliance Committee process.
ODC Board member Larry Robinson also questioned how Boutin, Muncy and other board members were coming up with the broadened definition of “year one” which actually encompassed four years to which Mr. Boutin stated “The way I would interpret the contract would be any expenditures by end of year one would qualify.” Boutin then goes into a rather lengthy and convoluted justification as to why this backdating should be allowed. Mr. Boutin then went on to state that any expenses that are “specifically for this project” should be allowed.
“It’s important to note that prior to Nacero arriving in Odessa, they had also announced projects in Arizona and Pennsylvania. Even if we accepted Mr. Boutin’s and Ms. Muncy’s rather absurd definition of ‘year one’ ODC had no way of knowing, other than what Nacero had told us, as to what the approximately $99 million dollars that had been spent since 2018 really applied to the Ector County project.” stated Crow. “I was so frustrated, I was up on the dias trying to protect our taxpayers and we had City staff and my fellow board members totally unconcerned about us getting screwed. As I looked over for help I saw Mr. Cole staring at the ceiling, Mr. Edgmon with his head in his hands staring down at the desk, and Ms. Hollman fiddling with her computer. It seemed clear to me that these members along with Mr. Boutin had worked with City staff and probably Chamber staff to figure out a way – any way – to provide this funding to Nacero and to keep their crony Wes Burnett employed.”
Fast forward to Thursday’s ODC meeting which provided an update from Nacero official Hal Bouknight. During this meeting Bouknight was grilled by both ODC President Kris Crow and Vice President Jeff Russell regarding the status and future of the Nacero project. While Bouknight stated that Nacero remains committed to the Penwell project their current focus has shifted once again and is now centered on producing methanol to use in shipping operations and that a new site for this scaled back project was being sought on the Gulf coast – hundreds of miles away from Odessa. Under questioning Bouknight admitted that no substantive work had been completed on the Penwell site and that all of the property purchase options they had negotiated had expired.
“I’m really angry about this whole debacle,” stated Crow. “This isn’t the first time we’ve seen members of the ODC Board which are closely connected to the Odessa Chamber of Commerce be willing to twist the rules and even logic itself into a knot to funnel taxpayer monies to a project they support. We saw it a few years ago with the grant to the Ellen Noel Art Museum and, if they are allowed to have it their way, I can almost guarantee we’ll see this type of irresponsible behavior happen again.”
“We’ve heard a lot of talk about cronyism lately trying to paint the current City administration and its board appointees in a negative light but everyone needs to realize this is just an attempt by the Chamber crowd to distract taxpayers from the real insider dealing that everyone knows has been going on for years that has siphoned off millions of taxpayer dollars to a variety of Chamber aligned players and interests” Crow concluded.