Once reliable, timely renewal of coal tax credit no longer a sure bet for Crow Tribe

May 21 - McClatchy-Tribune Content Agency, LLC - Tom Lutey Billings Gazette, Mont.

 

For 10 years, Crow Indians have nervously waited, sometimes into December, as Congress has debated whether to extend the Indian Coal Production Tax Credit in one year increments.

The tax credit lowers the price of Absaloka Mine coal, which is on tribal land and mined by Westmoreland Resources.

But last year, renewal of the tax credit didn't come soon enough, Crow Tribal Chairman Darrin Old Coyote told The Gazette.

Congress didn't get around to extending the tax credit until early December. And while the extension was retroactive, there wasn't enough time left for the Crow to apply it, Old Coyote said. The outcome was a $3 million hole in the Crow budget, which had been penciled out earlier in the year under the assumption the tax credit would come.

"Last year, we put it in the budget. It was extended, but the timing wasn't right," Old Coyote said. "I think we only had like 30 days before it sunsetted on. We didn't have time to monetize it."

Consequently, tribal employees were furloughed to make up for the loss, and this year, working hours for tribal members have been trimmed to 32 hours a week. The tribe isn't going to budget for the benefits of a tax credit Congress again hasn't passed and may not again until year's end.

On the Crow Indian Reservation, where according to state labor statistics unemployment is 25 percent, households with coal mining income can earn more than $70,000 a year. The coal income tax credit gave Westmoreland Coal Co. $2.26 for every ton of coal mined.

The tax credit created in 2005 by former Montana Sens. Max Baucus, a Democrat, and Conrad Burns, a Republican, used to have an easier path to renewal, Old Coyote said. Burns was on the Senate Appropriations committee; Baucus was on Senate Finance and chaired the committee from 2007 until his retirement in early 2014.

Baucus, as finance committee chairman, was sure to pencil the tax credit into the bill of annual tax break extensions, which he carried. The tax credit has had a much harder time since Baucus left the Senate after 36 years to become U.S. ambassador to China, Old Coyote said.

The Crow have been lobbying Congress to make the Indian Coal Production Tax Credit permanent. Their efforts took a step forward this week when a group of senators introduced a bill making the tax credit permanent.

Montana Sens. Steve Daines, a Republican, and Democrat Jon Tester, co-sponsored the bill, along with senators from Wyoming, North Dakota and Kansas. Old Coyote said the tribe isn't just turning to Montana lawmakers but also senators from states like Minnesota, home to the Sherburne County Power Plant, which burns Crow coal.

"The Indian Coal Production Tax Credit is an essential tool in Montana tribes' work to achieve self-sufficiency, increase economic opportunity and create good-paying jobs for tribal members," Daines said in a Senate floor speech Monday. "A permanent extension provides tribes much-needed certainty to invest in large-scale energy production projects."

Daines makes the connection between coal and tribal economics frequently and loudly. He held a U.S. Senate Committee on Indian Affairs field hearing at Crow Agency last month about "Empowering Indian Country." Much of the hearing focused on Environmental Protection Agency plans to cut carbon pollution forcing coal-fired power plants to curb pollution, which could threaten coal sales.

In Daines' election to the Senate last year, doubts about Democrats supporting coal boosted the Republican's popularity in Indian Country.

Tester is no coal opponent. He's participated in earlier attempts to make the tax credit permanent.

"This is an opportunity to create jobs in Indian Country so that we can help take pressure off social safety net programs that are financially strapped," Tester said. "I look forward to working with folks in Congress and tribal leaders to get this tax credit secured once again."

billingsgazette.com

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