Capitol Update for March 9, 2007

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Here is this week’s update by lobbyist John Tuma:

A Barrel Full of News This Week.

There was a great deal of activity on environmental issues at the Legislature this past week, so this report is a little longer than usual.  We had an emotionally packed committee hearing on global warming, some committee victories on energy efficiency, some challenging fiscal targets set by the Senate leadership, and some interesting rumors floating around the dedicated funding proposal.  Here’s a quick snapshot of the week’s activities.

Global Warming.  At the end of last week, the Global Warming Mitigation Act of 2007 was modified by chief author Rep. Maria Ruud (DFL- Minnetonka).  The modification made the planning process work better and received praise from several of the swing votes on the committee.  We felt pretty confident going into the scheduled committee vote Tuesday in the House Environment and Natural Resources Committee.  It became clear on Monday that Rep. David Dill (DFL – Crane Lake) was going to push an amendment to remove the provision which is called the “no backsliding” provision for electrical utilities. 

The no backsliding provision prohibited any additional electrical utility contracts from increasing global warming pollution until Minnesota developed a regional cap and trade program for these pollutants.  If utilities signed new contracts to purchase power from coal plants they would have to identify how they would offset this new pollution. These offsets could be things like taking other less efficient coal plants off-line or providing for environmental practices to capture the carbon such as planting perennial crops or trees. The multitudes of powerbroker lobbyists hired by the utilities argued that this would kill the Big Stone II power plant which, they said, is necessary for us to keep our lights on in the future. 

The Clean Energy Minnesota (CEM) lobbyists felt confident in the beginning of Tuesday’s committee hearing, but that is when the first big smelly red herring was slapped into our laps.  The definition of a “red herring” is an irrelevant argument that distracts from the main question.  In this case our red herring was fear by northern legislators that the temporary “no backsliding” provisions would stop the construction of a proposed new steel plant in northern Minnesota.  Steel plants are very dependent on electricity and Rep. Dill argued that the global warming bill would deny construction of power plants needed to provide power to the proposed new steel plant on the Iron Range, which is not true.  Further adding to the drama was information we first received in the committee debate that the construction trade unions had weighed in against our global warming bill because of their fear that jobs would be lost for the construction of some of the new coal power plants.

The committee chair, Rep. Kent Eken (DFL-Twin Valley), feared that the Dill amendment would succeed.  He knew the no backsliding provision was the pressure needed to keep the utilities moving quickly towards a cap and trade on global warming pollution in the future.  They would just string out the planning process until there was a federal program and never allow any Minnesota effort to take place.  Therefore, he came in with what he perceived was a good compromise amendment replacing the no backsliding provision with what was essentially a temporary carbon tax.  This would allow utilities that generate new global warming pollution to pay a penalty per ton of new global warming emissions.  The money collected could be used for purchasing global warming reduction activities.  Unfortunately, such an approach has not been successful in Oregon. 

After dramatic debate and a half hour recess for behind closed door discussions, Rep. Eken agreed to essentially pull his amendment and have the carbon tax provisions studied over the next year.  That made way for a tense vote on the Dill amendment which failed on a tie vote of 9 to 9.  A few DFL legislators we had in our friendly category voted against us because of all the intense pressure from labor unions and utility lobbyists.  Most of the Republican minority, smelling an opportunity to throw a wrench into the works, also voted against the amendment.  Thankfully, we were saved by a key vote from Rep. Kathy Tingelstad (R-Andover), the only Republican to vote against the Dill amendment.  This was a courageous move at a very critical time in our effort to pass a meaningful global warming bill this session.  If you’re so moved, this is a great time to say a big thank you to Rep. Tingelstad.

The bill eventually passed out of committee with a recommendation that it pass.  Some legislators wanted to move it out of the committee without recommendation, but that motion was defeated.  There were some rumblings due to pressure from the big-time lobbyists hired by the Big Stone II power plant that Chair Eken might not sign the committee report and bring the bill back up for reconsideration in his committee.  Despite great pressure, the chair did the brave thing by signing the committee report.  Now the bill moves on to a friendlier committee – the House Energy Finance and Policy Division.

The global warming bill in the Senate is set for a vote next week, and we are hearing that a barrel full of red herring is waiting for us.  Clean Energy Minnesota lobbyists are going to be pretty proficient at filleting red hearings before the end of session.  If we wash out as lobbyists, we can always get a job at a salmon cannery in Alaska.

Energy Efficiency.  One of the major parts of the Clean Energy Minnesota initiative is to reduce energy consumption in Minnesota.  The cleanest energy is energy we do not use.  SF997/HF1221 authored by Sen. Scott Dibble (DFL – Minneapolis) and Rep. Jeremy Kalin (DFL – Linstrom) overcame two committee hearings this week.  The bill received positive reception in the Senate Energy, Utilities, Technology and Communications Committee and in the House Energy Finance & Policy Division.

Senate Budget Targets.  The success of Clean Water Legacy is very dependent on a strong budget target for the environment.  Unfortunately, this week the Senate chose to lower its budget targets to avoid having to increase taxes.  The Governor only provided $20 million a year or $40 million over the biennium for the Clean Water Legacy.  The Clean Water Legacy amount was nearly half of his $83 million budget increase in the environment and agriculture spreadsheets.  The Senate targets only have designated $20 million total of new spending in Environment, Energy and Natural Resources Division for the full biennium. 

The target for Agriculture and Veterans Division is $32 million.  The Senate’s combination of Agriculture and Veterans Affairs means that agriculture will likely get the short end of the stick when the $32 million is divvied up, given the fact that we are at war.  This is important because the agricultural budget funds a portion of the Clean Water Legacy and will also fund the next generation biofuel proposal being pushed by Clean Energy Minnesota.  This biofuels legislation calls for a significant investment in development of prairie grass ethanol production, but without dollars it will be a delayed investment at best.  The House budget targets are expected to come out next week and we can only hope to see more generous dollars for the environment and energy.

Dedicated Funding for Our Great Outdoors.  Monday started out with some very sad news at the Legislature.  Former Senator Dallas Sams, former chair of the Senate Agriculture and Environment Finance Committee, passed away after a long struggle with brain cancer.  Senator Sams had carried the dedicated funding proposals in the Senate for many years.  As a result several senators have indicated they want this to be the year dedicated funding finally passes as a tribute to their friend Dallas.  Even though we had our occasional run-ins with Senator Sams, there is no doubt he was one of the most pleasant and genuine individuals to work with at the Capitol.  Having served in several conference committees with him and lobbied him hard in the environmental arena, I can attest that he was a wonderful individual who will be sorely missed by family and friends.

Adding to this new commitment on the Senate side are rumors that the House may be giving serious consideration to dedicated funding.  There is no solid information on the details.  The session started with the House showing little interest in even discussing dedicated funding.  Therefore, even though it is just a rumor, it is momentum in the right direction.

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