CHARLESTON, W.Va. -- Continuing some CSI-type reconstruction of how a last-minute amendment turned a rather innocuous tax credit for natural gas-powered vehicles turned into a heyday for buyers of all types of hybrid and flex-fuel vehicles -- and is costing the state some $100 million in lost tax collections:
We know the strike-and-insert amendment to the Marcellus Gas and Manufacturers Development Act was offered on the evening of the final day of the 2011 session by then-House Finance Chairman Harry Keith White, D-Mingo, about an hour into the 7 p.m. floor session.
Not unusual that it would be a Finance Committee amendment or that it would be strike-and-insert (which replaces the entire contents of the bill, and is frequently done to avoid screwing up numbering of code sections that can occur with cut-and-paste amendments.)
Even in the era of transparency, with delegates able to see the 40-some-page amendment on their laptops or tablets, it would have been a near-impossibility to decipher in the few moments before the vote on the bill how it greatly broadened the types of vehicles that could qualify for the generous tax credit.
In fact, it passed 95-4, with Andes, Cowles, Jonathan Miller and Savilla voting no.
White said that, with all the recent controversy, he tried to go back to recollect what happened.
He said he couldn't recall who requested the tax-credit expansion included in the amendment, but said it was agreed-upon (meaning the House and Senate leadership had signed off on it), and said no one from the Tax Division or governor's office raised any objections.
(Suspicions are that auto dealers pushed it, but I couldn't reach lobbyist Ruth Lemmon for comment Friday.)
By the time the bill got back to the Senate, it was one of the last bills acted upon before the session ended at midnight. (In fact, a motion to change the bill's effective date to that July 1 was the final vote by the Senate before sine die.)
Sen. Brooks McCabe, D-Kanawha, said the main crux of the bill was to provide incentives to attract a methane cracker plant to the state.
He said the language in the House amendment was the same as an alternative fuel tax credit that had been available from 1997 to 2007, and had had minimal impact during that time, while the original bill originally limited the credit to natural gas vehicles.
"The bill I sponsored initially took them all out, but the House put in back in," McCabe said of language to include other alternative and flex-fuel vehicles.
In order to assure passage of the bill, and the cracker plant incentives it included, McCabe said he did not oppose the change, assuming it would not have a major financial impact.
What everybody discovered in retrospect, he said, is that flex-fuel vehicles -- which account for the vast majority of the $100 million in tax credits -- really started pouring onto the market in the late '00s.