Louisiana residents sue to unwind SpaceX tax deal

Three Vermilion Parish residents and a new nonprofit have sued parish officials for alleged open meetings violations related to the landmark SpaceX deal.

The stakes of the open meetings suit, filed Monday, are high. It could void the tax incentive agreement reached to land the $100 billion bill, if the court grants the relief sought.

The plaintiffs outline eight alleged violations, unfolding in four meetings in July and August, described as a concerted attempt to conceal key decisions on the project from public view.

Five violations are alleged against the Vermilion Parish Police Jury and three against the Vermilion Parish Industrial Development Board, a body created to facilitate the tax agreement. The tax agreement is called a PILOT, for “payment in lieu of taxes,” agreement.

The deal exempts Starbase Louisiana from local property taxes but requires the company to pay $25 million a year to the local taxing authorities.

The sequence of decisions outlined in the lawsuit covers three crucial actions: approving the ExxonMobil settlement that unlocked the coastal land for the project, resurrecting the industrial board and signing off on the PILOT agreement.

The suit was filed by Pecan Island resident Cheryl Choate, Abbeville residents Robert Young and Rebecca Young, and the Vermilion Citizens Coalition, Inc., a nonprofit Robert Young incorporated Oct. 21. The group of plaintiffs is represented by New Orleans attorney William Most.

Vermilion Parish Policy Jury President Chad Vallo referred comments to the police jury’s attorney who did not respond in time for publication.

Starbase Louisiana is going up on 125,000 acres of marshland once owned by ExxonMobil. Vermilion Parish is among several parishes to sue oil and gas companies for coastal damage related to drilling activities in the 20th Century.

The police jury approved a settlement in the Vermilion Parish case on July 15, according to meeting minutes. But the open meetings suit alleges the matter was not on the meeting’s agenda, nor was a motion carried during the proceedings to add it, meaning the public would have had no prior notice of the decision before police jurors that day.

“No item on the agenda gave any indication that the VPPJ would be considering a settlement with the ExxonMobil company,” the suit alleges.

Gov. Jeff Landry has been a vocal critic of the suits. He boasted about the Exxon agreement after the July 15 vote in a post on X, the social media platform owned by SpaceX CEO Elon Musk.

The terms of the Exxon deal have not been disclosed.

The settlement documents were whisked out of Vermilion Parish by a staffer of the governor’s office, the suit alleges, again to keep them out of public view. Denying an Oct. 16 public records request filed by The Current, an attorney for the police jury claimed the body had no digital copies and that the governor’s office currently held the original documents for “processing.”

“The efforts to keep the public in the dark are so extreme that after the Vermilion Parish Police Jury signed a settlement agreement with ExxonMobil, the Governor’s office sent a staff member to take away every single copy of the agreement – so that Vermilion citizens cannot even review what their elected officials agreed to,” the suit alleges.

Shortly after approving the settlement in a unanimous vote, the police jury took up a motion to appoint seven people to the Vermilion Parish Industrial Development Board, a body that had been defunct for nearly 30 years.

In this case, the suit alleges, the police jury illegally amended the agenda mid-meeting to avoid notifying the public of the action. Adding items mid-meeting is permissible in emergencies, plaintiffs say, but not as means to evade public notice requirements.

A month later, the jury voted to swap out one member of the industrial board, again without including the item on the agenda or adding it during the meeting, the suit alleges.

The police jury did not livestream either meeting, the suit claims, amounting to two further alleged violations of state open meetings law. State law requires governing authorities serving communities of 25,000 people or more to “broadcast live” their proceedings.

No Vermilion Parish Police Jury meeting has been livestreamed since Louisiana’s open meetings law was revised to include that requirement in 2024, according to the Abbeville Meridional.

On July 23, the industrial development board met for the first time in decades. On Aug. 25, the board approved the PILOT agreement, which includes a lease-back arrangement with SpaceX for use of the acreage obtained from Exxon.

Neither meeting was properly noticed, the suit alleges. What notice was posted — a sheet of paper stuck to an Abbeville courthouse — referenced the matter only by the SpaceX project’s state code name, Project Osprey.

The board itself is characterized as a mystery in the suit.

“It has no website. It has no publicly listed email address. It is not referenced in the Vermilion Parish code of ordinances. It is not referenced in state law. And its origin is also shrouded in mystery. The VPIDB was created in 1972, and then went inactive in 1997,” according to the petition.

But it plays a critical role in what’s been described as the biggest economic development deal in state history.

By contract, the industrial development board owns the land set for Starbase Louisiana, but SpaceX has the right to recover it. The PILOT agreement spells out what SpaceX pays in place of taxes and outlines a schedule for reaching several jobs benchmarks, among other terms.

The PILOT agreement has been publicly disclosed.

The plaintiffs insist they are not attempting to upend Starbase Louisiana itself. Instead, they cast their suit as a petition for good government and transparency.

Landry and his economic development leadership have made widespread use of non-disclosure agreements connected to big-ticket deals like SpaceX and the Meta Hyperion Data Center in Richland Parish.

The governor has defended the speed and secrecy, arguing that the deals couldn’t happen without it.

“You think I want Texas to steal my thunder, you think I want other states to know what we’re working on? Quite frankly, that’s what has continued to happen to Louisiana before I became governor,” Landry told reporters in a press gaggle after the SpaceX announcement.

Critics say the secrecy has instead suppressed public input on transformative projects. Pecan Island residents have complained they were in the dark in the run-up to the SpaceX deal’s announcement, arguing that they ought to have some say in a decision that is likely to change everything for the small coastal community.

At a meeting with Pecan Island residents in September, SpaceX officials could not rule out that the number of launches would block access to homes and hunting camps. The company hopes to one day fire 30 rockets each day as it works to build out its Starlink satellite network and put data centers into orbit.

Vermilion Parish officials have largely celebrated the deal and brushed aside concerns about secrecy.

“The public did have a role,” Vermilion Parish President Chad Vallo told the Times-Picayune the day after the SpaceX announcement in August . “They found out about it yesterday.”

This story was originally published by The Current and distributed through a partnership with The Associated Press.