February 8, 2011
Wyoming

Wyoming House passes wind energy eminent domain bill

By JEREMY PELZER Star-Tribune capital bureau, trib.com 8 February 2011

CHEYENNE – The state House on Monday overwhelmingly approved a proposed two-year extension of the state’s moratorium on wind developers’ eminent domain powers.

House members also advanced legislation that would dramatically change the way Wyoming’s wind energy industry is taxed – and the way that tax revenue is distributed.

The eminent domain extension legislation, House Bill 230, passed the House 53-6 without debate.

Some lawmakers previously said that allowing the current one-year moratorium to expire on June 30 would raise landowners’ wariness of eminent domain when dealing with wind developers on land leases to build collector lines. Other legislators said they needed more time to study the issue.

Still other lawmakers had questioned why the state should prohibit wind developers from using eminent domain when other industries are still allowed to employ such powers.

State Rep. Tim Stubson, R-Casper, speaking against the bill, said lack of transmission lines makes it extremely unlikely that any collector lines will be built in the next two years.

House members also passed on second reading House Bill 191, which would revamp the state’s wind tax and distribution method.

The bill, which faces a final House vote today, would combine the upcoming $1-per-megawatt-hour wind energy tax and the sales tax on wind energy equipment into a single $3-per-megawatt-hour excise tax.

Currently, existing wind farms would pay the $1-per-megawatt-hour excise tax when it takes effect in 2012. A sales tax exemption on renewable energy equipment is set to expire at the end of this year.

The bill would also create a $15 million impact assistance account to help local governments pay for infrastructure costs associated with wind energy projects.

Under the bill, the revenue from the $3-per-megawatt-hour tax would be split using a complex formula among the state’s general fund, local governments and the impact assistance account. Right now, the excise tax revenue would simply be divided 60-40 between local governments and the state, respectively.

Stubson said in his proposal, which is supported by most within the state’s wind energy industry, the proposal would bring in slightly more revenue for state and local governments than the current tax system. At the same time, he said, his plan would also encourage growth in Wyoming’s nascent wind energy industry.

But there’s wariness among many legislators about HB191 and the general prospects of the wind energy industry as a whole.

One of those opponents, state Rep. Mike Madden, R-Buffalo, said he was worried about the state fronting money to an industry that has yet to prove itself viable and is reliant on federal subsidies.