----- Original Message ----
From: James Kotcon <jkotcon@wvu.edu>
To: william.depaulo@gmail.com; ec@osenergy.org
Sent: Thursday, May 29, 2008 10:56:05 AM
Subject: [EC] Transmission tax

Below is the Governor's press release regarding his proposal to impose a
transmission tax if TrAIL is approved.  The first line specifically
states that the Governor's Office released this proposal in a response
to the Sierra Club FOIA.  My question is : "Does the Governor have any
other details of this proposed tax?  Would it apply only to TrAIL, or to
all transmission from the state?  If it is specific to TrAIL, would it
not violate the Interstate Commerce Clause of the US Constitution?  The
line would originate in PA and end in VA, so how could one state impose
a tax on the privilege of electrons crossing the state, especially if
the power is generated in Ohio or PA, not WV?  If it applies to all
transmission lines, why should other existing transmission companies pay
a tax just because TrAIL is being installed? 

This proposal raises so many questions that I do not know where to
begin or how to respond, but you can be sure that these questions will
be asked tomorrow, if not at the hearing, then by reporters afterward.

Would it be appropriate to request more info on this from the
Governor's Office? 

JBK

May 23, 2008

GOVERNOR PLANS TO PROPOSE TRANSMISSION TAX
IF TRAIL LINE IS APPROVED
Manchin says he wants to protect interests of all West Virginians

Contact: Lara Ramsburg, 304-558-2000

CHARLESTON, W.Va. – In response to a Freedom of Information Act
Request from the Sierra Club of West Virginia, the Governor’s Office
has released information on a proposed transmission tax that Gov. Joe
Manchin intends to pursue should either the federal government or the
state Public Service Commission approve the TrAIL Line project.

“This is something I have been thinking about and discussing for some
time, primarily because of the possibility of the federal government
superseding any decision that may be made on the state level,” Manchin
said.

In May 2007, the Federal Energy Regulatory Commission (FERC) issued an
order interpreting the Energy Policy Act of 2005 to say that the FERC
had the power to issue a permit for construction of a new power line
even if a state lawfully denied a site transmission application.

“If the line goes through, I want to do all that I can to make sure
that we have a plan in place that will provide a benefit to the
communities affected, and the state as a whole, for providing a key
piece of America’s energy infrastructure.”

The governor’s proposed plan comprises four components:
- Rate reductions for West Virginia’s citizens so that they will pay
less, not more, for the power they will receive from the line.
- Extra revenue for the counties that house the line.
- Extra revenue for the state that will allow it to provide additional
services to all its citizens.
- Free electricity for all landowners who are affected by the placement
of the line.

“If the TrAIL line is approved, either by the PSC or the federal
government, we will stand ready to make sure that our citizens aren’t
taken advantage of and instead receive a benefit from its placement in
West Virginia,” Manchin said.

# # #



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