Fletcher Calls Special Session For Monday

Associated Press Writer

FRANKFORT, Ky. (AP) - Gov. Ernie Fletcher signed an executive order on Friday calling lawmakers back the Capitol for a special legislative session to consider approving tax breaks for a proposed $3 billion coal gasification plant.

The order came after weeks of negotiations on a proposal aimed at convincing Peabody Energy to build the massive plant in the state. The session will reconvene at 4 p.m. EDT on Monday.

The dollar value of a proposed incentives package intended to lure a $3 billion coal gasification plant to Kentucky would be substantial, but lawmakers say they are not certain of the actual amount.

Legislative leaders, in hopes of attracting Peabody, have agreed to provide financial incentives for all qualifying companies that build alternative fuel facilities. Early estimates put the value of the proposed Peabody incentives at $300 million.

"I don't think it will be as rich as was originally proposed, but it will be real close," said state Sen. Robert Stivers, R-Manchester, one of the primary architects of the proposal.

However, House Majority Floor Rocky Adkins, one of the architects of the plan, said the actual incentives will be decided by the Kentucky Economic Development Finance Authority, not the General Assembly.

"We've not guaranteed Peabody anything in this bill," Adkins said Friday.

State lawmakers have spent much of the summer drafting legislation, and met behind closed doors in Frankfort on Thursday to iron out the final details.

The proposal would provide breaks on sales taxes, income taxes and coal severance taxes for alternative fuel plants.

Adkins said the proposed legislation sets broad limits on possible incentives, but that the final decision will be made through negotiations between state economic development officials and companies that apply for the tax breaks.

Senate President David Williams said the dollar value of the incentives will be determined through negotiations.

"Peabody or any other company must come in, make application and enter into negotiation if they want to take advantage of any of the incentives that are offered," Williams said.

Fletcher included the issue on the agenda with several other items when he called the General Assembly into a special session last month. House lawmakers refused to take part, saying many of the items on the agenda could wait until they convene in January.

House Speaker Jody Richards said he expects the special session to end next Friday with the energy bill enacted.

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

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