The wind industry could lose out on hundreds of millions of dollars of tax incentives with another change proposed by lawmakers.
House Bill 3711 advanced in House and Senate budget committees on Thursday. It would cap income tax credits available to wind energy producers at $35 million annually. The Legislature ended the incentive for new projects last year.
The most recent figures showed more than 150 companies were claiming a total of $60 million through the incentive. The result, if the bill becomes law, is that wind companies won’t be able to access the full amount of tax credits available to them during the 10 years they are eligible to apply.
Lawmakers arguing against the bill have said the state would be breaking a promise made to the companies, which would make Oklahoma look bad to other industries being lured here with the assurance of tax incentives.
“The expectations and estimates have been met long, long ago,” said the bill’s author, state Sen. Marty Quinn, R-Claremore
Mark Yates, Oklahoma executive director for The Wind Coalition, said the cap is arbitrary and hurts companies that have made major investments to build wind power farms. The companies, he said, used anticipated savings from the benefit when signing agreements to sell wind power at low rates.
“As Oklahoma has already ended its incentive programs for wind, our state already stands at a competitive disadvantage compared to states like Texas and Kansas in which programs still exist,” Yates said. “With the continued punitive actions against wind, our state stands to lose out on the potential of billions in future investment, and that’s not limited to wind.”
The bill passed both the House and Senate Joint Budget Committees on Appropriations and can be heard on the floor. If it becomes law, several lawmakers predict litigation could follow.
“I think we’re setting ourselves up for a lawsuit,” said state Sen. Casey Murdock, R-Felt. “Can Oklahoma really afford legal action and defend what we’re doing here? A lot of these companies have worked these incentives into their financial plans.”
Quinn replied that it would be a disingenuous move because businesses have to adjust to market conditions.
“If this industry wants to look the core services of this state in the eye, if they want to look teachers in the eye, if they want to look the Department of Corrections in the eye and say we’re going to sue you,” he said, “then you need to take whatever action you feel is necessary.”
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