BILL TO TAX HIGH PLAINS POWER PLANTS SAILS THROUGH HOUSE AND SENATE WITH ONLY FRULLO AND DUNCAN OPPOSED

On May 5, 2011, a bill to access property taxes on the two Odessa power plants purchased by High Plains Diversified Energy/ Republic Power Partners passed almost unanimously in the House and Senate. The vote in the House can be found here. State Representative John Frullo joined only one other member of the House in opposing the bill. State Representative Charles Perry voted to tax the power plants.

On the Senate side, Senator Robert Duncan joined only one other Senator in voting against the tax. The Senate vote can be found here.

As previously stated in this blog, Odessa is very upset about the potential loss of 6.4 Million in tax revenue and enlisted the help of its State Representative Tryon Lewis and Amarillo Senator Kel Seliger to push the bills through the legislature. See the story in the Odessa American here. Each bill will now go to a joint conference committee to be reconciled and then a final single bill will go back to each chamber to be passed. Because the bills passed with an overwhelming majority of the vote in each chamber, it appears that this is one of those non controversial bills that will easily be passed into law. However, Julie Hillrichs, a spokesperson for High Plains, told the Avalanche-Journal that she believed the law to be unconstitutional. According to a story written by A/J reporter Elliott Blackburn, she said that “The company was operating under the system the Legislature had put in place, and did not believe the effort to change that was constitutional…” “If legislation is passed and we’re forced to pay 100 cents on the dollar to the local taxing authorities, that is a concern.” My guess is that High Plains will send in the lobbyists to kill the bill in conference committee. If they lose in conference committee and the bill goes to the Governor, they will lobby him hard to veto it. If that fails, they will challenge it in court as unconstitutional. The bottom line, as I have learned in following this story, is that the individuals who are behind this power grab are determined, wealthy, politically connected and should be taken very, very seriously.

On a related front, the hearing on the High Plains lawsuit to issue 1.5 Billion in revenue bonds and 75 Million in subordinate bonds has been moved to May 16, 2011. As of May 5, 2011, no one has intervened in the suit to oppose the request.