Fargen, Lange, Schmidtke, Stricherz Recognize Oil Tax Breaks Wrong
KJAM asked our District 8 House and Senate candidates what they think of the millions of dollars South Dakota gave away to TransCanada this year as an incentive for building the Keystone pipeline (second question on each interview, minute or two in). The answers are instructive about who’s looking out for South Dakota and who’s making excuses for Big Oil.
Republican Senator Russell Olson offers no surprises with his passionate advocacy for Big Oil, saying the tax refund was “absolutely” good. He hews closely to the company line (TransCanada’s and his boss’s at Heartland Consumer Power District), telling us the Keystone I pipeline was an $800-million stimulus for South Dakota.* TransCanada is now the biggest property tax payer in the state, says Olson, pumping more money into school and county budgets than any other industry could. Every barrel of oil from TransCanada, says Olson, is one less barrel from petrodictators like Hugo Chavez. And TransCanada got $30 million less in refunds from Pierre than they originally projected. Olson says TransCanada has brought our state a “phenomenal amount of money,” and the “economic benefit certainly outweighs the one-time $10 million rift that everybody is so worked up about.”
That’s a strong answer. Too bad it misses the point. Olson’s Independent Democratic challenger Clark Schmidtke points out that we didn’t need to hand out that $10 million in the first place. Both Schmidtke and incumbent Democratic House candidate Rep. Mitch Fargen note that neither North Dakota nor Nebraska offered such cushy tax breaks to TransCanada. If Russ’s analysis of local benefits from the pipelines is correct (and I question even that), North Dakota and Nebraska got similar benefits for free. We could have gotten the same benefits and still kept that $10 million for education or health care or other local priorities, just as North Dakota and Nebraska did. Oops.
Schmidtke does answer the broader question about state incentives in general for economic development by saying he can support applying and even expanding these tax refunds to ethanol companies, since ethanol does more direct good for South Dakota farmers and workers. Fargen adds that the refund program TransCanada exploited was developed to support South Dakota’s ethanol, soy diesel, and wind energy companies. He and Schmidtke agree that TransCanada’s refund was a giveaway that produced few jobs for South Dakotans.
Posed the same question, incumbent Democratic candidate for House Rep. Gerry Lange doesn’t hesitate to brand the TransCanada giveaway a bad idea. Lange recognizes the value of this tax incentive for the local energy projects for which it was originally intended, like the soy diesel plant. But that contractors’ excise tax that we refunded to TransCanada is the same tax that hits school districts and counties when they build public improvements. Why, asks Lange, hit South Dakota taxpayers with that expense for building schools and roads and bridges, then turn around and give back millions to a foreign company for building a pipeline (which I will note gets no public use)?
Republican House candidate Patricia Stricherz (who, yes, is currently a paying advertiser here on the Madville Times) is just as forceful and unhesitant as Lange in saying the TransCanada tax refunds were “Absolutely not” a good idea. She notes that TransCanada has already had leaks in South Dakota and says companies that want to come here should have to prove themselves worthy.
So where does that leave Independent/9-12 candidate for House Jason Bjorklund? Let’s read the transcript of his response to the question:
Admittedly I’m not entirely up on TransCanada. I haven’t been in the Legislature obvioulsy, so I’m not privy to all the information they’ve had, but as far I understand this is a done deal and at this point there’s nothing we can do about it. Do I think this is best way to bring buinsesses and jobs to South Dakota? No, not necessarily. We need to look at ways to encourage businesses to come here without spending the… limited resources that we have. Now this TransCanada thing it appears to be a done deal, they’ve got the money, there’s nothing we can do at this point but sit back and look at the numbers how many jobs did it create in the state, was this a good move for us to do, and keep that in mind as we make future decisions [Jason Bjorklund, interview with Lauri Struve, KJAM Radio, 2010.10.13].
Here Bjorklund has a golden opporunity to put his 9-12 Project principles into action. He could rail against wasteful government spending and crony capitalism. He could show that he can translate the slogans he gets from national talk radio into real solutions that put South Dakotans first. Instead, he hems and haws and provides more cover for the Republican regime in Pierre than the declared Republican on the House ballot offers. Not necessarily… it’s over and done… there’s nothing we can do about it….
Bull-roar. A legislator not beholden to the GOP or Big Oil could do lots about it. He could declare it bad policy and a waste of money, as Schmidtke and Fargen do. He could point to other priorities where the money would be better spent, as Lange does. He could highlight the dangers posed by the pipeline, as Stricherz does. He could look ahead and vow to repeal the refund for the Keystone XL pipeline and recoup the money with a pennies-per-barrel pipeline tax (a good idea that Senator Russ Olson killed this year).
Schmidtke, Fargen, Lange, and even Stricherz are making clear that, on this issue, they recognize that we should put South Dakotans ahead of foreign oil corporations. Olson is proving once again that he’s in the pocket of Big Oil. Bjorklund is hinting that he’s more interested in covering for the mistakes and corporate giveaways of the Republican machine in Pierre than in challenging the powers that be and sticking up for average South Dakotans.
Olson-Bjorklund: The TransCanada Ticket
*So if Kristi Noem can look at South Dakota’s current economic situation and say the federal stimulus failed, can we say Olson’s imputed “TransCanada stimulus” also failed?