A bill to help develop wind energy in Nebraska advanced in the Legislature Tuesday. It would give sales tax refunds to renewable energy companies that build projects in Nebraska.
LB 104 was introduced by Sen. Steve Lathrop of Omaha.
Nebraska currently ranks fourth in the nation in wind resources, according to the American Wind Energy Association, but lags behind neighboring states such as Iowa in wind energy development.
Lathrop’s bill would create a new tier under the Nebraska Advantage Act -- which provides tax incentives for economic development -- for electricity generation from wind, solar, geothermal, hydroelectric and biomass.
It was drafted to secure the construction of a 100-200 megawatt wind farm in Dixon County by Kansas-based wind energy developer TradeWind.
Lathrop said he has been given assurances by TradeWind officials that they will move forward with the project, if LB 104 becomes law.
“We will throw the welcome mat out,” he said.
Most of the energy from the TradeWind project would be sent to other states.
Lathrop said the project would generate significant economic benefits for Dixon County and the state as a whole, including $10,000-$15,000 a year to the property owners of each turbine, and a personal property tax on turbines to be paid to Dixon County.
He said the project would create about 25 long-term jobs and bring additional revenue into the local community during construction.
Critics: Not enough
Critics of the bill argue that it doesn’t do enough to ensure the economic benefits of these wind projects remain in Nebraska.
Several senators favor an alternative bill, LB 402, which would provide incentives to renewable energy developers under the Community-Based Energy Development Act, or C-BED.
C-BED requires companies to invest a percentage of their earnings in the community where the project is located through lease payments to property owners, or by contracting with Nebraska companies for construction materials and services.
Sen. Jim Smith of Papillion called Lathrop’s bill a “piecemeal” approach to the issue of wind development in Nebraska.
“We can be on the leading edge. We don’t have to be on the bleeding edge,” he said, referring to potential revenue leaving the state.
Sen. Heath Mello of Omaha, who introduced the alternative bill, said he nevertheless supports Lathrop’s bill.
He said both bills could change the landscape of energy policy in Nebraska.
Sen. Galen Hadley of Kearney introduced an amendment that lowers the Tier 5 investment threshold from $30 million to $20 million. That would allow smaller projects to qualify, he said.
The amendment was adopted, 25-0.
Sales tax rider
Senators also adopted a modified version of local sales tax changes proposed by Sen. Ernie Chambers of Omaha.
Chambers' amendment prevents cities of the metropolitan class, which is only Omaha, from levying a local sales tax above 1.5 percent.
Last year, senators increased a community's ability to levy up to 2 percent, with voter approval.
Chambers has never liked the potential sales tax hike. On Monday, he tried to repeal it and said he would continue to press for changes, with an amendment that would rise again and again "like Dracula,” referring to the eternal life of the prince of darkness.
Perhaps seeing the seriousness of Chambers' intent, the Legislature adopted his Omaha-specific amendment Tuesday, 30-5.
George Lauby of the Bulletin contributed to this report.