By Heather Richards and Josh Wolfson
Via Wyoming News Exchange
CASPER — A bill to increase Wyoming’s wind tax blows through Cheyenne nearly every year, and every year it dies.
Some lawmakers don’t support the increase because they are afraid of depressing wind investments in Wyoming. For some the tax is unattractive on principle, or because they believe the current wind product tax — unique in the United States — is sufficient.
But supporters persist. They argue that Wyoming wind producers should be taxed and that right now the tax is insufficient. They point to the contribution made by other industries: coal, oil, gas. Wind has an impact, an irreparable change to the landscape of Wyoming too, and the state should be paid for it, they argue.
The proposal has failed four times, but it’s back again in 2019, as some lawmakers say they are ready to address revenue shortfalls and expand Wyoming’s tax base beyond what is levied on minerals.
Sen. Cale Case, a longtime supporter of upping the wind tax, said this very well could be the year for wind revenue, too.
The giant steel structures lined up across the horizon take something away from Wyoming, in Case’s view. The more people realize how much bigger today’s towers are and just how many are set to rise on the landscape, the more likely they will be to make the industry pay a fairer share, he said.
“My confidence is growing,” he said. “If it doesn’t happen this year, they better not be doing a happy dance. It will be back next year.”
This year’s wind tax proposal is much like its predecessors. House Bill 96 would increase Wyoming’s wind tax from $1 per megawatt hour to $5 per megawatt hour.
In addition to Case, the bill has three sponsors from the House: Rep. Scott Clem, R-Gillette, Jim Blackburn, R-Cheyenne, and Tim Hallinan, R-Gillette.
The wind tax bounces back every year largely due to its tenacious champions. Case is one. The other, Rep. Mike Madden of Buffalo is now retired. It was his role to introduce the bill as a representative — all revenue bills must come through that house.
Madden, speaking from semi-retirement in Buffalo, said he’s not confident the wind tax will make it this year. But he is sure that there is more public support to increase the wind tax than it seems.
Wyomingites prefer taxes paid by someone else, he said — a nod to Wyoming’s fossil fuel taxes that are borne by buyers of those minerals outside of Wyoming.
Any tax that would be raised is virtually all going to be paid by out-of-state people. And they are out-of-state people that want to and will pay more for wind.
Political support is perhaps different, he said, but eventually opposition will fold.
“It seems like a good idea takes several times to soak in,” he said. “Sooner or later people turn around and say ‘OK, maybe we should.’”
During the 2018 session, leadership in the Senate under Sen. Eli Bebout was strongly anti-tax, Madden recalled. That antipathy may not be present this year under a new leader.
Senate President Drew Perkins, R-Casper, has already noted his support for increasing the wind tax in an interview with the Star-Tribune last week. Speaker of the House Steve Harshman, R-Casper, was noncommittal. Harshman has noted in the past that Wyoming needs to embrace wind as part of diverse energy portfolio.
Case’s bill would bring in $42.5 million in taxes from when it begins paying in 2020 through 2022 — the fiscal impact measured by the Legislative Services Office.
With Wyoming thirsty for revenue after a few years of revenue drought, Case hopes that benefit is clear to other lawmakers. He mentioned the property tax increase that’s also been proposed this session, an attempt to find dollars for a persistent deficit in education funding.
The wind tax could achieve the same kind of income but without increasing the tax burden on Wyomingites, he said.
“It’s a chance to export taxes,” he added. “And the lightbulb is beginning to go off.”
Some people in Wyoming, particularly those invested in wind’s expansion in the state, do not appreciate the perennial tax.
Cindy Wallace, executive director of the Carbon County Economic Development Corporation, said the tax is just going to depress the industry, and potentially other industries that would see Wyoming as hostile. Carbon County is home to a number of in-construction wind projects to the tune of millions of dollars in anticipated local revenue.
Wyoming has more to lose than gain from the wind tax, she said.
“We just hope common sense will persist and it will die a fifth time,” she said.
When former Gov. Dave Freudenthal pursued a wind tax nearly a decade ago, he wanted $3 per megawatt hour. He got $1, the tax that exists today, and that was probably right, he said.
The former governor doesn’t believe the constant push for an increase is sound policy. It comes out of frustration with the wind industry — which has benefits from federal subsidies — and a strong dislike for wind farms on the landscape, but that’s no reason to impose a tax, he said.
“I understand the anger that drives it,” he said. “What I don’t understand is why anger is a basis for state policy.”
Wyoming’s gap in renewable tax policy is that it currently doesn’t tax solar. That’s where lawmakers should consider a tax expansion, he said. That and ensuring that solar goes through a regulatory process that is transparent for the public and ensures proper reclamation.
The wind tax increase is a red herring for the former governor.
The current governor, recently elected Mark Gordon, is also comfortable with the current wind tax.
“I think one of the most important things for Wyoming going forward is to understand that we have all of these resources,” the governor said Friday in Cheyenne. “They all have to play a role in powering our country, and they all should play a role in also powering our state.”
For Case, the support for the wind tax increase is out there. Some are hesitant, but support is growing. Wyomingites care about the landscape and producers will continue to view Wyoming as a good location for their business. In recent years, transmission limitations have depressed new development. But that’s already changed, he said. And people are starting to realizing that the new wind farms are bigger, the towers taller and the wingspans broader. Wyoming supports this wind tax, he said.
“I’m tired of being painted as a lone wolf,” Case said.