Friday, April 20, 2018

GOP Leadership go back on word, pushing Wind GPT instead of removing credits

One thing from the last year that seems evident is that if the Republican leadership in the Legislature gives their word on an issue, don't believe it. Here's an article from the Journal Record; additional comments and emphasis is mine.
By: Catherine Sweeney The Journal Record

OKLAHOMA CITY – Despite a guarantee that the state House of Representatives would hear a bill to change tax credits for wind power, the measure never appeared on the floor Thursday, and lawmakers said they are switching gears.

Top-ranking House Republicans held a press conference on Wednesday to address concerns and potential misinformation about the fiscal 2019 budget. Those officials have taken to several platforms to address multifaceted rumors that the increases in education costs aren’t fully funded. At the end, House Floor Leader Jon Echols said that the House would hear Senate Bill 888 first thing the next morning.

That measure has included several provisions, which were entirely replaced by other policies in amendments. The final of the handful of forms would end the zero-emission tax credit’s refundability for wind companies. It would prohibit the companies from using more credits than they need to cover their liability. The bill’s supporters said the state shouldn’t cut checks to corporations, especially in tough budget times. Over the past few years, Oklahoma has spent about $70 million [annually] on these refunds, which could be used elsewhere for the few years that the credit has left.

SB 888 has struggled to make it this far in the committee process, often garnering close votes and opposition from the majority party. [and opposition from the Democrats]

The House convened at 10 a.m. but immediately went into recess so that House Republicans could meet to caucus, where members sort by party and chamber to strategize privately. Floor proceedings resumed, and members heard several bills unrelated to wind before recessing to go into caucus again. Finally, about 1 p.m., Echols announced that tension and a lack of political will to pass that provision had taken hold.

“That’s why we were gone so much and did not run 888 today,” he said. “We will be hearing an agreement on a (gross production tax) on Monday.”

That tension was visible long before Thursday. In an April 10 House committee meeting, SB 888 got nearly as many votes in opposition as it did in support. Of the 12 members who voted against it, half were Republicans. That included House Assistant Majority Whip John Pfieffer, who represents District 38, which contains several wind farms. He said that measure would hurt companies that have already located in his district. Wind farms blanket western Oklahoma, which is widely represented by Republicans.

The idea of a gross production tax on wind is also not necessarily a new development. The idea of implementing one has been floating around the Capitol for months, most notably in January when the Step Up Oklahoma coalition included it in its recommended tax package. Once the dust settled with the two-week teacher walkout, budget planners started eyeing it again. Senate Floor Leader Greg Treat has said several times that the delay was to prevent giving education demonstrators false hope; revenue from those provisions wouldn’t enter state coffers for years.

In an April 12 interview, House Majority Leader Mike Sanders said that although the Senate has seemed to focus on caps and ending refundability this year, all options are still on the table. Personally, he said, he would prefer implementing a wind gross production tax. He said the revenue stream would be more sustainable, and that public perception would likely improve if members prioritized policy over politics. He raised a concern that the Senate seems to be more focused on measures such as SB 888.

Democrats have almost uniformly opposed undoing the wind credits, while Republican legislative leadership evidently prefers to vote on a new tax (difficult-to-attain 3/4ths vote measure) rather than removing tax credits (easier-to-reach 50%+1 vote measure).

Wind GPT would bring in about $20M annually. SB888  as proposed by Brecheen, Dahm and Coody would save $70M annually - $500M-$750M over the next ten years.

Legislative leadership seems to want to raise taxes on wind with one hand, while giving them a greater sum through tax credits with the other hand.


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