Business groups balk at tax on Vermont Yankee

Bill Driscoll, executive director of the Associated Industries of Vermont. Photo by Anne Galloway

Bill Driscoll, executive director of the Associated Industries of Vermont. Photo by Anne Galloway

Business groups took a stand Wednesday against a provision in a miscellaneous tax bill that would require Vermont Yankee to pay $6 million in taxes to fund education, the Clean Energy Development Fund and a fund to help Windham County plan for the plant’s closure.

The $6 million tax increase was part of the miscellaneous tax bill, which passed the House on a voice vote.

At a press conference on Wednesday, the Vermont Energy Partnership and Associated Industries of Vermont said the tax was “arbitrary.”

Members of the House committee say it is a net-zero increase on Vermont Yankee since it replaces obligations of a similar amount of money that the plant has been paying into the Clean Energy Development Fund, which funds renewable energy among other things. Those obligations expired March 21 when the state’s license expired.

Guy Page, communications director for the Vermont Energy Partnership, a coalition of businesses that supports the nuclear plant’s continued operation led by Entergy Corp., the owner of Vermont Yankee, said the miscellaneous tax bill would add $6 million to an existing $5 million generating tax. He said the tax passed the House with too little debate.

“This is an arbitrary tax increase,” Page said. “It may even be punitive in nature. This sends out a very troubling signal about doing business in Vermont.”

William Driscoll, vice president of Associated Industries of Vermont, which represents manufacturing businesses, said the tax is going after a captive industry in Vermont that cannot move its business elsewhere.

Driscoll said the tax was supposed to end March 21 even if the plant continued to operate.

“To very quickly and with relatively little debate or consideration propose a new tax is poor policy,” Driscoll said.

He said doing so could hurt the state’s reputation as a place to do business.

Bob Stannard, a lobbyist for Vermont Citizens Action Network, a group opposed to the plant, argues the tax does not go far enough.

“The fact of the matter is that Vermont is currently giving them a $15 million gift by allowing them to heat the river and not use their cooling tower,” Stannard said. “We should demand that they start using cooling towers, stop heating our river.”

Stannard said the state should charge Entergy Corp. another $15 million in addition to the $11 million in generating taxes in light of the fact that the company has sued the state in federal court and not lived up to its promises.

Currently the plant has a waiver under the Clean Water Act to discharge heated water into the Connecticut River and bypass its cooling towers.

The miscellaneous tax bill that passed the house with little debate is now in the Senate Committee on Finance, which has asked the Vermont attorney general’s office to look into the propriety of the tax, which replaces monies that were required as part of state agreements with Entergy.

Deputy Attorney General Janet Murnane said the Attorney General’s Office expects to offer testimony next week but could not speak to the specifics of the bill.

Michael Burns, a spokesman for Entergy, said the company is opposed to the tax.

Meanwhile, a proceeding before the Vermont Public Service Board to consider a license renewal for the nuclear plant continues. And in the Second Circuit Court of Appeals, both the state and Entergy have appealed a legal judgment that the state Legislature’s attempts to effectively veto a new license for the plant were unconstitutional.

The Vermont Department of Public Service, which represents ratepayers before the board, has taken the position that Vermont law allows the plant to continue operating while the re-licensing process goes on.

Elizabeth Miller, the commissioner of the department, said this means the plant must continue its obligations under its permit, which include making payments to the Clean Energy Development Fund.

On Tuesday, attorneys for Entergy filed a letter with the Public Service Board stating that the company agrees with the department that state law allows it to operate during the re-licensing process and that the company must comply with its obligations.

Burns said the filing speaks for itself, and an article in VTDigger.org stating the company agreed to continue making payments to the fund “got it wrong.”

Miller said while the plant continues to operate, it must live up to its obligations, including making payments into the Clean Energy Development Fund.

“We had sought to ensure that so long as the expiration date for operation was suspended so too would the expiration of any obligation by Entergy be suspended,” Miller said. “They weren’t supposed to operate past March 21 without a new CPG. They’re still operating, therefore the conditions that apply to them should still be in place.”

Alan Panebaker

Comments

  1. Chuck Lacy :

    Until Associated Industries of Vermont discloses who it represents, the press of Vermont should not present them as representing anybody. Vermont business groups claiming to represent a business membership should make clear who they represent or they should be treated like empty shirts. Or the Wizard of Oz.

    • Bruce Post :

      I agree. I am told that AIV does not disclose who is on its Board of Directors.

  2. Alex Barnham :

    The VERMONT Energy Partnership is a non-profit organization based in Holyoke, Massachusetts.

  3. Barbara McKay :

    How is it “bad for business” to require a company to fulfill its contracted obligations as long as it’s operating?! This claim by Driscoll is an outrageously high-handed attempt to seize new ground in favor of a company that has repeatedly screwed the state. Furthermore, VY is not an ordinary business. Enormous risk and damage should be at least somewhat offset by high taxes.

  4. James Marc Leas :

    The Senate now has a chance to add millions more to the tax and should do so. The House version would merely maintain the pre-March 21 tax level.

    The media campaign to cut the tax waged by Vermont Energy Partnership and Associated Industries of Vermont has fallen flat. They offer no reason why Entergy should have its payments to Vermont cut in half.

    Entergy has the money. It takes in about $1 million a day out of Vermont when Vermont Yankee is operating at full capacity. These business front groups use words like “arbitrary,” and “punitive” and “very troubling signal” but what is the alternative if the state is to have a balanced budget? Any tax Entergy ducks will fall on someone else or result in cuts in education, health care, or other state services. The business spokesmen do not explain why pushing more tax on other businesses or on the 99% would not be “arbitrary,” and “punitive” and a “very troubling signal.”

    Entergy has treated truthfulness as an optional activity. Same for basic maintenance at this nuclear reactor resulting in leaks and a fire. Same for democracy, as Entergy is using its money and its connections to push aside the will of the people of Vermont as expressed in town meeting votes, legislative votes, and the last gubernatorial election.

    The Senate should not be satisfied with the work done by the House. It should double and redouble the tax.

  5. Coleman Dunnar :

    Bill Driscoll said “doing so could hurt the state’s reputation as a place to do business.”

    Not to worry the Vermont anti-business message has already been clearly heard around the world and the legislature insists on constantly reinforcing the message.

  6. John Greenberg :

    AIV’s website states: “… it is our general policy not to release our membership directory.” Given the group’s knee-jerk reactions to all issues concerning Vermont Yankee, it’s certainly reasonable to ask if Entergy is a member.

    We KNOW, on the other hand, that Entergy IS a member of Vermont Energy Partnership, and this fact should have been disclosed here.

  7. Alex Barnham :

    Yes, Vermont is not interested in more nuclear reactors, thank you.

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