Inslee vetoes tax break to encourage fuel switch at coal plant

By Erin Voegele | July 13, 2017

On July 7, Washington Gov. Jay Inslee vetoed a portion of a bill that aimed to create tax incentives to support the conversion of the state’s only coal-fired plant to natural gas or biomass fuel.

Sections 601 to 606 of the bill, S.B. 5977, would have created sales and use tax exemptions to encourage coal-fired power plants to convert to natural gas or biomass in an effort to retain jobs.

Language in the bill states “It is the legislature’s specific public policy objective to retain jobs at existing coal-fired electric generation facilities by providing a tax exemption to allow these facilities to convert into natural gas-fired generation plants or biomass energy facilities rather than shut down entirely.” According to the bill, the tax incentives aim to “reduce the costs recently imposed by the legislature on companies that operate coal-fired electric generation facilities, thereby increasing the ability of these companies to continue their operations in Washington state, thereby retaining jobs that would otherwise be lost if a coal-fired electric generation facility were to shut down.”

In a statement explaining his veto of sections 601-606 of the bill, Inslee said, “These sections incentivize a company to do something that it is already required to do by law, giving it an unfair advantage over other Washington companies.” He also vetoed a section of the bill related to tax incentives for manufacturers.

State Sen. Doug Ericksen has spoken out to criticize Inslee’s line-item vetoes.  “These vetoes demonstrate Jay Inslee has no respect for the working men and women of Washington state—the people these incentives were designed to benefit,” he said.  “At the same time, he has lost the respect of the Legislature. I am confident we will be able to override these vetoes because of the overwhelming support this bill received in the House and Senate.”