With half the Wyoming legislative session done and gone, deadlines and opposition have killed a number of soon-to-be-forgotten energy bills, from a handful of attempts to increase wind taxes to a coal tax cut. But a smattering of bills survived committee by Friday and will move forward, including the controversial bill born out of the Standing Rock protest of the DAPL oil pipeline and a handful of measures regarding uranium and coal.
These measures face a tight timeline on a busy docket. Proponents will need to shepherd them successfully through three readings in their house of origin in order to jump to the other house by a Wednesday deadline.
A bill intended to protect energy infrastructure from sabotage, but criticized as an attempt to quell free speech and protest, is back this year after dying by governor veto in 2018.
The bill was brought to the industry law firm Holland & Hart last year by the petrochemical and refining industry group, the American Fuel and Petrochemical Manufacturers, according to reporting from Wyofile. The law firm then brought it to lawmakers and asked for it to be introduced.
Pushback from free speech activists and condemnation from Native American groups has been strong. But, as of Friday, the 2019 iteration of the bill was still in motion.
Amendments were tacked on in committee, some to address concerns about the bill’s imposition on private property rights. What qualified as “infrastructure” was broadened via amendment to include a non-energy grab bag of protected facilities like schools and police stations, according to reporting by Wyofile.
The bill survived a split committee on Friday, passing 5 to 4. In support were Reps. Joe MacGuire, R-Casper; Tim Henderson, R-Cheyenne; Danny Eyre, R-Lyman; Don Burkhardt, R-Rawlins; and Tom Crank, R-Kemmerer.
A landowners’ group’s efforts to hold industry to the fire on tax debt when in distress or facing bankruptcy has held on through a committee vote in the Senate. Senate File 118 would bump counties higher up the list for payback when companies fall back on tax payments. Right now, counties can be left in the lurch when large industry companies owe back taxes, as other entities like banks collect their dues first.
The SF 118 approach was supported in years past by former Rep. Mike Madden, R-Buffalo, who retired from the legislature last year. Sometimes a curmudgeon when it came to collecting taxes to support local communities, Madden had also supported more dramatic changes, like forcing fossil fuel companies to pay their local taxes monthly rather than yearly in arrears like they do now. That idea came under fire from the coal industry — not for the first time in Wyoming — during the last interim, with some coal companies reportedly telling lawmakers that they couldn’t afford to make such a switch given the pressure on them in the current tense market climate.
Tax relief for U3O8
Uranium producers may get a tax break in Wyoming. House Bill 139 passed 7-2 in the House Revenue Committee last week. It would exempt companies from paying severance taxes when the spot price for uranium is under $30 per pound from next year until 2033.
Travis Deti, executive director of the Wyoming Mining Association, said he thought the bill had legs. Deti presented a similar ask to lawmakers during the interim session two years ago. At that time, Wyoming’s oil, gas and coal industries were still climbing out of a bust and lawmakers were not impressed with a uranium tax cut.
The industry hasn’t improved, however, as the vast majority of uranium in the United States is procured on a cheap international market. A couple Wyoming operating companies have sought relief from the Trump administration.
Raising wind revenue
Quite a few lawmakers stepped up this year to raise taxes on wind energy, but all three bills directed to this cause died. The wind bills included a Casper lawmaker’s bid to raise the $1 per megawatt hour tax to $4 per megawatt hour. Rep. Scott Clem, R-Gillette, and a handful of others wanted to add $4 to the existing tax for a total of $5 per megawatt hour via House Bill 96.
The most creative of the measures was House Bill 260. Rep. Dan Zwonitzer, R-Cheyenne, suggested a five-year escalating tax. Wind developers would pay no tax in year one of production, 50 cents in year two, $1 in year three, $3 in year four. From year five on, the tax would be $5 per megawatt hour.
All of these attempts would have raised significant revenue, but bills to raise Wyoming’s unique wind tax in recent years have always failed to convince lawmakers concerned about depressing wind industry investment in Wyoming.
The controversial tax may end up out of lawmakers’ hands. Sen. Cale Case, R-Lander, has been a proponent of raising the tax for years and was a cosponsor of House Bill 96 this session. But, Case has also encouraged a crew of Wyomingites to take the matter to a popular vote, an attempt that could put the wind tax on the ballot in 2020.
With a permitting war in Wyoming that’s become unsustainable, skirmishes over leases and drilling permits were taken up by a handful of lawmakers. But industry is pushing for solutions to be brokered during the interim session and attempts failed to make it past committee deadline Friday.
Rep. John Eklund, R-Cheyenne, had hoped his idea of increasing the drilling application fee to $10,000 might help end the permit war and return Wyoming to an even playing field. In his neck of the woods, an incredible amount of leasing rights are in the hands of Anadarko Petroleum, something that landowners say is causing a number of interrelated problems blocking production. Many are also concerned by forced pooling — when mineral rights owners are pushed into drilling plans they object to.
Forced pooling also showed up on Gillette Republican Sen. Michael Von Flatern’s radar. His bill would have changed the amount of financial responsibility carried by a nonconsenting owner of minerals in a drilling operation but never came up in committee.
A coal bill from Rep. Chuck Gray, R-Casper, that would authorize $250,000 for lawmakers to hire a private attorney to fight for a coal export terminal in Washington, has made it through the House Judiciary and Appropriations committees. Another measure, House Bill 167, cutting the severance tax on coal by 0.5 percent, failed in committee Friday evening.