State Lawmakers Agree On Coal Incentives Bill

FRANKFORT, Ky. (AP) - State lawmakers agreed late Thursday night on a bill that would provide incentives for companies that build high-tech coal plants in Kentucky.

Senate President David Williams said he expects the General Assembly to convene on Monday afternoon to begin the legislative process to enact the measure.

Legislators met behind closed doors for much of the day Thursday trying to iron out details of the bill, which is aimed at enticing Peabody Energy to build a coal gasification plant in the state.

"It is a comprehensive energy bill, it really is not a coal bill at all," said House Speaker Jody Richards, D-Bowling Green, said. "This bill, the more I read it, the more I see about the green aspects of it ... it's in many ways an environmental protection bill."

Once the major details were ironed out, lawmakers asked Gov. Ernie Fletcher to call a special legislative session. Fletcher was unavailable Thursday evening, and his press secretary, Jodi Whitaker, didn't immediately return a phone call seeking comment.

The proposal would provide a number of financial incentives for Peabody and other energy companies to build plants in the state, including breaks on sales taxes, income taxes and coal severance taxes.

State lawmakers have spent much of the summer considering a proposal, which, by some estimates, would provide about $300 million in tax breaks for Peabody. Williams said Thursday night that he wasn't sure how much the final package of incentives agreed to on Thursday would total.

Fletcher called the General Assembly into a special session last month to deal with the proposal. The Senate passed an energy tax-incentive plan, but the House did not address Fletcher's legislative agenda and adjourned.

Lawmakers had said they were hoping to ask Fletcher to call a special session to begin this past Monday. But certain undisclosed issues remained unresolved.

Richards said Thursday that he was optimistic a plan could get done. The proposal addresses issues about capturing carbon emitted from the coal gasification process, and emphasizes use of renewable resources, Richards said.

"This is all about a new direction for energy in Kentucky that emphasizes renewable energy," Richards said.

House Majority Floor Leader Rocky Adkins, D-Sandy Hook, has been involved in the negotiations and said he considered it a "well-balanced energy policy." The public would be informed of the details once the legislative leaders agree on a plan, Adkins said.

Adkins, who is the director of public affairs for Appalachian Fuels in Cannonsburg, said he did not have a conflict of interest being involved in the negotiations and working for an energy company.

"This effects all energy companies in many different energy fields. I don't think it is (a conflict) at all," Adkins said. "I have tried my best to come with a well-balanced policy, a good policy that I think will have very positive impacts on the commonwealth of Kentucky."

(Copyright 2007 by The Associated Press. All Rights Reserved.)

AP-NY-08-16-07 2324EDT

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