W.Va. committee votes for tax credit for natural gas storage hub

Both Del. Evan Hansen, D-Monongalia, left, and Del. Tony Paynter, R-Wyoming, right, said they had reservations about an incomplete fiscal note attached to a bill giving tax credits to natural gas storers and transporters. (Photo by Perry Bennett, WV Legislative Photography)

CHARLESTON — In the hopes of bringing a natural gas liquids storage hub to West Virginia, the West Virginia House of Delegates Energy Committee passed a tax credit for the natural gas industry on Tuesday.

House Bill 4421, sponsored by Del. Eric Householder, R-Berkeley and chairman of the Finance Committee, would give tax credits against personal income tax or corporate net income tax to natural gas liquids storers or natural gas liquids transporters.

Lawmakers critiqued the vagueness of the fiscal note, and then passed an altered version of the bill rendering the fiscal note invalid. The original version would have given tax credits to natural gas liquids producers, natural gas liquids storers, natural gas liquids users or natural gas liquids transporters.

The fiscal noted had noted that, "numerous businesses use at least one natural gas liquid for general heating purposes or general operation purposes such as fueling forklift vehicles. West Virginia businesses collectively pay more than $400 million each year in local personal property taxes, mainly on machinery, equipment and inventory."

In an interview following, Del. Evan Hansen, D-Monongalia, an environmental scientist and a member of the committee who voted against the bill, said that the fiscal note basically meant "this would impact some portion of that $400 million dollars."

"The fiscal note didn't have any estimate in terms of how much this would cost the state or local communities so I thought it was irresponsible to vote for something without knowing how much it would cost," he said. "This could potentially be big. It could be in the tens or hundreds of millions of dollars in losses to the state budget."

Del. Tony Paynter, R-Wyoming, who voted for the final version, added that he would have opposed the original version of the bill. 

"I'm going to say this probably would have been better if it had been held a week to get the right numbers in light of the committee amendment, but that's the good thing about being double-referenced," he said. "Finance will know the exact numbers. I just wish we would have had the exact numbers."

He also said he hoped the bill leads to jobs, even if they'll likely be out of district. 

"This is just basically so we can store it here, run all the facilities here and distribute it from here and we'll have the jobs here for it instead of just popping it straight out of the state, letting them fool with it and we take the beating for it," he said.

Both Hansen and Paynter agreed that they would have preferred to wait and vote at an upcoming meeting. 

'I'm not just an energy guy," Paynter said. "I'm a big fiscal conservative, too."

During the meeting, Del. Mike Caputo, D-Marion, asked about a section, stating that the bill was needed because a "number of regulatory requirements" are "redundant, inconsistent or overlapping." Caputo, who voted against the bill, wanted to know where that information came from. Counsel for the committee responded that those comments came from industry, not official studies.

The committee voted, 12-9, to send the bill on to the Finance Committee for consideration. Locally, Del. Kayla Kessinger, R-Fayette, was also heard voting for the bill. 

Vivian Stockman, the executive director of OVEC, the Ohio Valley Environmental Coalition, who was present at the meeting, said she walked out "shellshocked and flabbergasted" that no comments abut environmental impact, including impacts on air, water and climate, were made during the meeting.

Stockman said the proposed Appalachian Storage and Trading Hub would run along 400 miles or so of the Ohio River, leading to more underground storage of natural gas liquids, six major pipelines, thousands of miles of minor pipelines, cracker plants, and "a huge increase in fracking to supply the feedstock for this petrochemical complex of which the end-product would be plastic."

"Worldwide, we have a huge movement against single-use plastic because our seas are choking with it, our bodies – apparently we eat about a credit card's worth of plastic a week," she said. "People are sick from the pollution related to plastic. Plastic's bad for the climate and bad for the water. It's kind of like 'we would prop up a dying industry and give it tax breaks in order to pollute ourselves?'"

She said the Appalachian Storage and Trading Hub proposal is an effort to "prop up" the fracking industry.

"Once again, it's the endless promise of jobs, job, jobs with zero discussion of the true cost in terms of economics, in terms of human health and the environment," she said. "It's just the same old same old, at a time when literally the whole planet is saying 'enough with the plastics and maybe we better really take a look at our greenhouse gas emissions and make some changes,' the West Virginia Legislature wants to move ahead with a bill to give tax breaks to an industry that would further pollute us, without even really having all the knowledge about the tax breaks they want to give," she added. 

She suggested residents call their legislators, and that lawmakers give tax breaks "to entrepreneurs who are small-scale businesses, individuals who actually live here and care about the environment." 

Email: ebeck@register-herald.com and follow on Twitter @3littleredbones

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