Senate Taxation Kills Pipeline Tariff—Who Cares About Buying American Steel?

Senate Taxation rejected Senator Troy Heinert’s admirable “Buy American Steel” plan Monday. Senator Heinert had proposed Senate Bill 158 to encourage pipeline companies to use American steel to build their crude oil conduits across our fair state. SB 158 would have charged pipeliners a 20% tariff on the value of each length of pipe not manufactured in the USA.

Senator Heinert told Senate Taxation that American steel is the most reliable building material to protect our water supplies from pipeline ruptures. Absent pipeliners’ willingness to buy American, Senator Heinert said the 20% tariff would at least give us a cash cushion to clean up oil pipeline ruptures like the Freeman Keystone spill last spring.

The party responsible for that Freeman leak, TransCanada, sent lobbyist Drew Duncan to oppose SB 158. He said that once the Trump-revived Keystone XL pipeline is in the ground in West River, TransCanada will be the biggest property-yax-payer in South Dakota. He assured Senate Taxation that the Freeman spill was cleaned up entirely with TransCanada money and no state money. He said the SB 158 tariff is just like past pipeline-tax efforts that the Legislature has consistently defeated, in part due to violation of the Commerce Clause. He said SB 158’s cap on collections means some pipeliners would pay tax while others would not, which means similar taxpayers would face an unequal burden. (Note to future pipeline taxers: set no cap!)

Duncan said we can count on TransCanada to meet its legal obligations to clean up all spills. And when big corporations and billionaires say “Trust us!” the Republicans who elected Trump forget all about “America First!” and shout instead, “You betcha!” The six Republicans on Senate Taxation outvoted lone Democratic Senator Jason Frerichs to kill SB 158.