BluegrassReport.org

When There's No Difference Between Democrats And Republicans...

So freaking sad:

The interim joint Agriculture and Natural Resources Committee held a hearing to dispute the idea that the Earth is warming, at least in part because of carbon dioxide and other heat-trapping gases in the atmosphere produced by industrial activity.

Chairman Jim Gooch, D-Providence, a longtime ally of the coal industry, said he purposefully did not invite anyone who believes in global warming to testify.

"You can only hear that the sky is falling so many times," said Gooch, whose post makes him the House Democrats' chief environmental strategist. "We hear it every day from the news media, from the colleges, from Hollywood."

Neither of Gooch's invited panelists was a scientist.

I'm ashamed and disgusted that Gooch has a "D" after his name. What next, embrace teaching creationism in our public school science classes? Recall that Gooch also threw-up roadblocks last year when it came to mine safety legislation.

Gooch represents the type of Democrats that deserve a primary election.

Meanwhile, prominent national Democrats and Republicans are working together on the issue:

California Gov. Arnold Schwarzenegger (R) and former vice president Al Gore "are planning a bipartisan presidential forum on energy and climate change in New Hampshire in December," USA Today reports.

FYI -- Jim.Gooch@lrc.ky.gov

Sheer Insanity

This is insanity:

Proposed legislation to lure alternative energy plants to Kentucky would offer up-front cash payments to companies that won’t actually earn the incentives until years later, a benefit never before offered by the state.

The so-called “Incentives for Energy Independence Act” would offer payments potentially worth tens of millions of dollars to companies that convert coal or biomass into synthetic fuels even before those multibillion-dollar projects produce their first barrel of fuel.

So, Kentucky is going give millions of dollars in upfront cash payments for a technology that has never been developed for full-scale production in the United States? Is this good economic policy?

Unbelievable.

UPDATE (8:51 AM): Even more offensive is this part of the story:

Despite the increased financial risk, the proposed legislation does not mandate that companies receiving cash advances pay back the money if the facility fails to open or closes prematurely.

Fletcher Calls Special Session Beginning 4pm Monday, Concerning Just One Issue

Secretary of State Trey Grayson has just posted Governor Fletcher's (R) call for a special session of the General Assembly to begin 4:00 pm on Monday, August 20. The call deals with only one issue -- energy incentives.

Click here for the actual document.

Will Fletcher's desperation cause him to insanely change the call before Monday and try to open the door to the politically divisive issues in hopes of saving his political career? Stay tuned...

More On The $300 Million Coal Company Giveaway

Maybe someone a lot smarter than me can explain one particularly troubling item being considered as part of the frenetic effort to give away $300 million in handouts/incentives to wealthy coal companies during the special session of a non-budget year.

I'm told that one tax subsidy being offered -- that has never before been offered in an economic development package before -- is a credit of up to 80% of the severance taxes paid on the coal the companies burn. According to the Fletcher administration's analysis of Senate Bill 1, this rebate was worth half of the total amount going to Peabody.

As I'm reminded, severance taxes are paid at the time that coal is extracted from the ground to provide some revenue to the affected communities where mining occurs to repair infrastructure and diversify their economy beyond coal. But in the past few decades, little of the money has gone back to the counties and instead dumped into the state's general fund. And then last year, as I recall, Fletcher added an additional hurdle for the counties by making them apply for specific grants out of the coal severance funds.

Additionally, as one reader asked me, "why would Kentucky pay a company $300 million to buy its own product (coal) from itself?”

Can anyone help with this issue? Is giving away 80% of coal severance taxes in this manner sound public policy, particularly in the rushed manner it's being enacted (i.e., without public input and a full-analysis?). And are we ever going to get an environmental plan for the project, or is that not important any longer?

This deal is smelling worse and worse each day.

House Dems Showing Backbone On Special Session Fiasco

While I still worry that they're giving in to Governor Fletcher's (R) electoral desperation with the whole special session mess, I'm very pleased to see House Majority Leader Rocky Adkins (D) telling Senate President David Williams (R) to stick-it (and here) for his constant gamesmanship on the special session, especially given that Williams was the sole reason that Adkins' work on the coal-to-liquid issue was killed in the Senate in the final days of this year's regular session.

Let's hope Adkins keeps it up and Speaker Jody Richards (D) continues to demonstrate the backbone he showed last month when called into special session.

Meanwhile, we should all remain very uneasy about this whole special session debacle and the need to rush through a massive taxpayer gift for wealthy coal companies for a technology that has never been built for full-scale production in America, with significant environmental consequences, and one where the federal government isn't contributing, as was expected.

Democrats Ready To Cave To Fletcher?

Pol Watchers is reporting that agreement is near for a special session to give hundreds of millions of dollars to wealthy coal companies.

But what I don't understand, and which no one has ever provided an understandable explanation, is why the General Assembly is 1) rushing to give hundreds of millions of dollars in corporate welfare 2) during a special session 3) in a non-budget year 4) 13 weeks before an election 5) which has been called by the incumbent governor who trails by 21 points 6) for a project that can't get off the ground because the Congress recently refused to pass legislation that would provide the federal portion of the financial incentives 7) which Fletcher never cared about prior to the general election and 8) which Senate President David Williams (R) prevented from passing earlier in the year -- rather than wait until after the election to deal with in the formal budget year legislative session with the new governor and with public hearings on the subject?

I also don't understand why House and Senate Democrats are allowing themselves to be enablers, once again...

Update (2:44 PM): The Rural Democrat reports a breakdown among legislators on incentives.

Driven By Politics -- No need for special session on energy projects (Herald-Leader Editorial)

I couldn't have said it better myself:

Driven By Politics
No need for special session on energy projects
Herald-Leader Editorial

On Tuesday, the U.S. Senate made a special session of the Kentucky legislature unnecessary by wisely rejecting a support package for converting coal into other fuels.

Without the massive federal subsidies and guaranteed buyer, Peabody Energy and other companies will be in no hurry to move ahead with plans to build $3 billion coal-conversion plants.

Yet Gov. Ernie Fletcher still plans to call a special session, at a cost to taxpayers of $60,000 a day.

[...]

The only emergency is Fletcher's desperation to look like a leader as he faces an uphill run for re-election.

During the regular session earlier this year, the Republican Senate killed an energy bill that would have done most of what Fletcher and Senate President David Williams now consider so urgent. Fletcher didn't lift a finger to save the energy bill then.

The motive for this special session isn't energy policy; it's about giving a jolt to Fletcher's political prospects.

Update (1:31 PM): Speaker Jody Richards (D) weighs-in:

After the governor's presentation, House Speaker Jody Richards, D-Bowling Green, described Fletcher's comments as vague and said he does not think a special session is needed.

Richards suggested that the federal government should first decide whether it wants to provide incentives for coal-to-liquid plants before Kentucky signs off on its own incentive package. Congress has debated massive incentives for the industry in recent weeks, but the proposals offered so far have failed.

...He said he hopes the governor will reconsider his decision to call the session.

Desperate Governor Fletcher (R) Calls Special Session

Our desperate Governor Fletcher (R) appears to be exhausting every available opportunity to try use his official office to save his political hide from an embarrassing re-election defeat. Now that the primary is over, Fletcher has already returned to his favorite trick of holding fundraisers after official events, like this one the other day in Bowling Green.

Now Fletcher has called a special session of the General Assembly for July 5 to ramrod a $315 million gift to his coal company friends with little public debate -- an issue that Fletcher gave scant attention to when Senate President David Williams (R) killed related legislation in the final days of the recently completed General Assembly session.

Let's hope the media forces Fletcher to acknowledge whether he's taken any money from the four companies (and their officers) who are now asking for giveaways to build a coal-to-liquid plant in the state for either his private legal defense fund (which ridiculously allows unlimited corporate contributions), or for his re-election. Those four companies are TECO Coal, Peabody Energy, RenTech and EnviRes. Of those companies, we know that Fletcher is a favorite of TECO Coal's president and his wife:

SHACKLEFORD, JIMMY
9256 CUMBERLAND FALLS HWY
CORBIN, KY, 407010000
Employer : TECO COAL CORP
Occupation : PRESIDENT
$1,000.00 on 04/10/2007

--------------------------------------------------------------------------------
FLETCHER, ERNIE for
SLATE - STATEWIDE SHACKLEFORD, JIMMY
9256 CUMBERLAND FALLS HWY
CORBIN, KY, 407010000
Employer : TECO COAL
Occupation : PRESIDENT
$500.00 on 04/25/2006
FLETCHER, ERNIE for
SLATE - STATEWIDE

--------------------------------------------------------------------------------
SHACKLEFORD, JIMMY
9256 CUMBERLAND FALLS HWY
CORBIN, KY, 407010000
Employer : TECO COAL
Occupation : EXECUTIVE
$1,000.00 on 08/20/2003
FLETCHER, ERNIE for
SLATE - STATEWIDE 
         
-------------------------------------------------------------------------------
SHACKLEFORD, GLENNA
9256 CUMBERLAND FALLS HWY
CORBIN, KY, 407010000
Employer : NA
Occupation : HOUSEWIFE
$1,000.00 on 12/21/2006
FLETCHER, ERNIE for
SLATE - STATEWIDE 

--------------------------------------------------------------------------------
SHACKLEFORD, GLENNA
9256 CUMBERLAND FALLS HWY.
CORBIN, KY, 407010000
Employer : N/A
Occupation : HOMEMAKER 
$1,000.00 on 06/02/2003
FLETCHER, ERNIE for
SLATE - STATEWIDE   

--------------------------------------------------------------------------------
SHACKLEFORD, GLENNA
9256 CUMBERLAND FALLS HWY.
CORBIN, KY, 407010000
Employer : N/A
Occupation : HOMEMAKER 
$1,000.00 on 03/29/2003
FLETCHER, ERNIE for
SLATE - STATEWIDE 

The Herald-Leader story concerning the special session has comments from House Speaker Jody Richards (D) and House Judiciary Chair Kathy Stein (D) on the Fletcher's transparent political ploy:

Richards also said it appears to him that "someone in the administration solicited these company letters to bolster the governor's argument for a special session.

"All the letters are about the same.  I can't prove it but it would be a huge coincidence if they were not solicited."

[...]

State Rep. Kathy Stein, D-Lexington, said it was Republican Senate President David Williams of Burkesville who abruptly ended negotiations on an incentive bill for coal companies during the final day of this year's regular legislative session.

"If it wasn't urgent in March, I don't know why it's urgent now," Stein said.

Special Session Insanity

I think we all fully realize what is motivating Governor Fletcher (R) to call a special session of legislature -- it's the fact the polls have him down by as much as 25 points in his hopes for re-election which is less than five months away. Fletcher realizes that there are few options to try to reverse the tide of the pending Democratic tsunami that is poised to sweep him and his party out of office.

There's no legislative sessions left and Senate President David Williams (R) killed the very legislation (energy-related) in the last session that Fletcher now believes is so important that we must call our legislators back in session to deal with. It's all such a transparent farce and I can't wait to see these political incompetents voted out of office.

To give you a sense of the desperation, check out what Fletcher-supporters believe is so enormous, so crucial, that it can't wait until the regular session begins in six months:

Sen. Robert Stivers, R-Manchester, who helped explain the new bill at the meetings Friday and yesterday, said it would provide up to $315 million in incentives over 25 years for a $3 billion investment in a plant that would produce 300 barrels of liquid fuel from coal per day. 

300 barrels a day? Seriously? This is why they want to ramrod a special session?

At the current price of $68 per barrel, we're talking about $20,000 per day in gross revenue. Period. In contrast, the average supermarket of a large chain generates about $40,000 in revenue per day, or double what the proposed $3 billion plant (with $315 million of our tax dollars) will generate when it's up and running.

Investments in new generation energy plants makes sense, but only after some thoughtful debate and analysis. Instead, they want to spend $315 million in a special session without meaningful debate, public input and scant disclosure as to which companies the state is going to subsidize (and whether they too have contributed to Fletcher's legal defense fund). Sounds a lot like Williams' scheme to gut and privatize the state pension system in a matter of days with little warning or debate, costing us hundreds of millions of dollars in the process.

Let's hope House Democrats hold the line on this insanity.

Update (10:56 am): Turns out that the Courier-Journal made an error on the output of the proposed plant -- It's expected to generate 30,000 barrels a day, not 300. The Herald-Leader had a story last week about this project.

While 30,000 barrels is a significant quantity, it doesn't override the need to have a thoughtful debate on this issue, not just whether we want to spend $300+ million of taxpayer money (and who is slated to get it) but whether this is the direction the state wants to go. There is no need for a special session to happen less than four months from an election, especially given that this isn't a budget year in the first place.

A Little Hyperbole With Your Breakfast

Come on Rocky, let's leave the disingenuous fear tactics to the other side:

“A scary thought is the largest user of foreign oil is the U.S. military,” [House Majority Floor Leader Rocky] Adkins said yesterday, adding the country gets 15 percent of its oil from Venezuela, which could tell the U.S. any day it has decided to send the oil to China instead. “Gas prices would shoot up to $8 to $9 a gallon.”

Aside from the fact that Rocky is struggling with the notion of a world oil market operated on a supply and demand mechanism (hence, if Venezuela sold only to China, the oil that China now buys would be back on the market), it's sadly dishonest to declare $8 to $9 a gallon simply based on what Venezuela does.

Politics at its worst...