How a Billionaire Benefited From a Disastrous Oil Spill Caused by Her Company

There ’s an oil color spillway in the Gulf of Mexico that has beenongoing since 2004 , potentially spill as much or more oil over the course of 17 years as the Deepwater Horizon disaster . Yet rather than being held accountable , the owner of the society at demerit used the slow cleanup as a write - off so she could pay no federal income tax , according to a newProPublica report . The story , which is part of a prominent serial publication ProPublica is consort analyzing leaked documents showing the ways the ultra - wealthy wiggle out of paying taxes , shows how a disaster and regime - ordered environmental cleanup can be used as tools by the rich to make even more money .

ProPublica analyzed 13 age of personal tax returns from Phyllis Taylor , the possessor of Taylor Energy . A rig owned by the company first sprung a leak in the Gulf following 2004 ’s Hurricane Ivan . In that period , between 2005 — the year after the spillway startle — and 2018 , ProPublica feel that Taylor paid no income taxis on the $ 444 million she earned . She got away with this in part thanks to claim a massive fiscal loss that , by Taylor Energy ’s former CEO ’s estimate , does n’t exist , and an ineffective cleanup . All this happened even as the passing water her company caused continued to run out thousands of congius of oil a twenty-four hour period into the sea , endangering marine lifetime .

Taylor ’s financial windfall actually kicked off with a personal calamity : Her husband , Patrick Taylor , the father of Taylor Energy , died in 2004 , just a few calendar month after Hurricane Ivan . Fortunately for Taylor ’s funds , U.S. tax legal philosophy actually allows spouses to inherit companies with zero landed estate tax necessitate — a loophole that is stick out to be the U.S. Treasury around $ 500 billion in lost revenue over the next 10 years . Taylor , then 63 , was essentially gifted ownership of the company without any of the with child Das Kapital gains taxation that her married man would have had to give had he decided to betray the company to an extraneous party .

An oil sheen drifting from the site of the former Taylor Energy oil rig in the Gulf of Mexico, off the coast of Louisiana.

An oil sheen drifting from the site of the former Taylor Energy oil rig in the Gulf of Mexico, off the coast of Louisiana.Photo: Gerald Herbert (AP)

In 2008 , Taylor decided she want out of Taylor Energy , and betray off its assets to two South Korean companies for $ 1.25 billion . Because she ’d inherit the company without any associated tax , and because Taylor Energy was a secret company , her controller were able to perform a bit of taxation legerdemain : They assigned the caller an incredibly gamy value , meaning that , on paper , the $ 1.25 billion sale would face like it was an undersell . Taylor was then allowed to describe a loss on the sales agreement of $ 211 million — despite personally get around $ 1.2 billion out of the sales agreement . That red ink meant she did n’t have to pay any taxes on her income from the sale — and even got scored a $ 30 million refund on retiring taxation . ( Must be dainty . )

Taylor ’s grift keep going , buoyed , implausibly , on cleanup spot for the huge slew her company had made in the Gulf . A few months after she sold the fellowship , the federal government negotiated a deal with Taylor Energy that mandate it create a $ 666 million trust wholly devoted to cleaning up the still - leaking well . Because of the way the company was congeal up , this trust was linked to Taylor ’s personal financial accounts — and she was allowed to write off those killing cost on her personal taxis .

Even as Taylor was reap fiscal reward from the spill , she and her company were dragging their human foot on cleanup spot , blocking attack to make the extent of the catastrophe known and claiming that the news leak was impossible to stop up . The company was also simultaneously launch a series of ( failed ) legal actions against the administration to sample and get back some of the money it was expend on cleanup . They also consistently claimed that the wasteweir was only leaking 3 to 5 gal per day ; those figures were afterward revisit by the National Oceanic and Atmospheric Administration , which report estimated that the passing water was more than900 times largerthan Taylor ’s figures in a 2019 report .

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As ProPublica reported , Phyllis Taylor ’s reported “ losses ” from the sales agreement of her company as well as the cleanup are enough to keep her in the scarlet tax - wise for several more years . The tumble ’s impact will also play out for several more years , if not longer .

“ Some [ metal money ] will find quicker , while others may take decades , ” Martin Grosell , a professor of marine biology and ecology at the University of Miami , said in2019 Q&Aabout the spill on the university ’s situation . “ Such differences in retrieval rate may head to unbalanced ecosystem with outcome for some species even if these species were not directly impacted by the wasteweir itself . However , considering past spills , recovery can , in some cases , take tenner . ”

As big oil company get along underincreasing examination for their misdeed , Taylor ’s history is a reminder that lesser - know company have act major function in do environmental damage , from a petite Alabama oil and gas producersnapping up more wellspring than Exxonto anoil midmajor belching out more methanethan the make name companies . Those company face less examination and are able to get off from more — and make some serious money in the process .

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