$1.8
million in wind energy incentives OK’d
By Paul Hammel
WORLD-HERALD BUREAU
Legislative Bill 561 was sent to the governor on a
44-1 vote after a series of maneuvers to free up about $1.8 million to finance
a sales tax incentive for private investors in wind projects.
The bill would allow public power districts to
waive their right of eminent domain over privately financed wind energy
projects, which had been a hurdle for some private developers.
The measure also would make a major change in the
Community-Based Energy Development (C-BED) law, intended to ensure that at
least 33 percent of the profits from wind farms benefit farmers and rural
communities.
Under the change, sought by investors associated
with Omaha-based Tenaska Inc., profits could be applied to paying off the
multimillion-dollar loans required to finance wind farms.
State Sen. Chris Langemeier
of Schuyler, who worked with Tenaska on the bill, said obtaining financing for
$100-million-plus wind farms has been a barrier to development in Nebraska, a
state with high wind energy potential but ranking only 24th in wind power
generation.
Tenaska employees, including the company’s
president, Howard Hawks, put up one-third of the cost of a $144 million wind
farm that was recently completed near
Greg Van Dyke, Tenaska’s vice president of finance,
said the employees were unlikely to invest in another project because the
original C-BED law made it difficult for them to borrow money.
Sen. Steve Lathrop of
Langemeier,
chairman of the Legislature’s Natural Resources Committee, said farmers appeared
more interested in leasing their land for turbines than in becoming investor-owners,
as initially was envisioned in the C-BED law.
The bill and the process that led to its passage
brought harsh criticism from
“This is about big money running the process,”
Hansen said. “These are powerful players who wanted to change the C-BED model
to work more to their advantage.”
State records indicate that since 2005, Tenaska has
contributed about $14,000 to Gov. Dave Heineman and
legislative candidates.
The so-called Tenaska amendment was introduced late
in the legislative process. It represented such a significant change that a
public hearing was ordered before the Natural Resources Committee, a rarely
taken step on an amendment.
Langemeier
crafted a new amendment that was supported by every major business and farm
group in the state, except the Farmers Union.
A glitch emerged on Friday when a fiscal note
estimated that the amendment would gobble up between $1.2 million and $2.4
million a year in sales tax revenue. C-BED projects qualify for a sales tax
incentive on purchases of equipment, a powerful incentive to invest.
That led the Legislature to take another unusual
step on Wednesday — pulling back another bill that had already been approved
containing about $1.8 million a year in sales tax incentives for nonprofit
health clinics.
By in effect “un-passing” Legislative Bill 420, the
action freed up funds in a tight budget year to finance the tax incentives for
wind farm investors afforded under LB 561.
A handful of lawmakers, led by Brenda Council of
Proponents say the Tenaska amendment could lead to
two to four new wind farms, creating up to 400 construction jobs, 32 permanent
jobs and up to $32 million in new property tax revenue.
“This is an opportunity to jump start the process,”
said Sen. Mike Flood of
Only Sen. Tom Hansen of
■ Contact the writer: 402-473-9584, paul.hammel@owh.com
Proponents say the Tenaska amendment could lead to two to four
new wind farms, creating up to 400 construction jobs, 32 permanent jobs and up
to $32 million in new property tax revenue.