Wind power sales tax breaks advance along with Omaha sales tax freeze

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May 21, 2013 - 6:38pm

Large wind power projects would be exempt from sales taxes, and Omaha would be prohibited from raising sales taxes, under a proposal advancing in the Legislature.

The wind power bill is sponsored by Sen. Steve Lathrop of Omaha. It would give companies that build big wind projects in Nebraska a sales tax exemption on the components they buy. Lathrop predicted great things would come from his bill. "If we pass LB104, we will start the development of wind in earnest. And when we start the development of wind in earnest, I tell you today that the companies that build towers will come to Nebraska. Behlen Manufacturing, Valmont, those companies will start manufacturing this," Lathrop said. "We just gotta to get out of the way. Level the playing field and the companies that build, that manufacture will come to Nebraska because there will be an explosion of wind power development."

Lathrop cited in particular a proposed $300 million to $400 million development in northeast Nebraska’s Dixon County by a company called Trade Winds. He said it would boost the local economy, including through payments to landowners where wind towers would be located, and taxes paid to county government.

Sen. Tom Hansen of North Platte, comparing tax breaks to peanuts, called them unnecessary. "If we don’t give Trade Winds the peanuts, then we’re still going to have the wind, and eventually, someone will figure out that wind is valuable," he said.

Sen. Jim Smith of Papillion said the proposal is inconsistent with existing Nebraska law governing the approval of power projects. Smith suggested instead that the state should study power development. "I think we need to have a comprehensive energy policy for the state. And develop our renewable resources for export. I think that’s a great idea. But we have to do it thoughtfully," he said.

Lathrop disagreed. "If you want to study it for a year this company will be gone. The economic benefits to Dixon County will be missed. And you will have another study," he said.

As debate on the bill was finishing, Sen. Ernie Chambers offered an amendment containing a scaled-back version of his proposal to take away cities’ permission to raise city sales taxes to two percent. Chambers’ new proposal allows all cities in the state to keep that permission except for his city, Omaha.

Lynn Rex, lobbyist for the League of Nebraska Municipalities which has advocated keeping the increased sales tax option for cities, said word was circulating around the Capitol that Omaha Mayor-elect Jean Stothert said she did not want to keep the permission to raise sales taxes.

With little debate, Chambers amendment was adopted. The wind bill then got the second of three required approvals on a voice vote.

On another matter, Gov. Dave Heineman announced he has vetoed $200,000 for the U.S. Senior Open golf tournament from the budget. Heineman said it’s not appropriate or fair for taxpayer dollars to support the tournament. Sen. Tom Carlson of Holdrege said the money would be spent to promote Nebraska at the event, adding that he expects the Legislature to attempt to override the veto.

 

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