Bob Mercer follows up and gets the Governor’s Office of Economic Development to tell us why the state rejected Triple H Wind Farm’s request for a tax kickback like the state has handed to other windfarms, CAFOs, AGP, 3M, Terex, and other big businesses. It appears wind and solar have fallen out of the ring of favored industries because they don’t create enough jobs:
Wind and solar energy projects are important factors in expanding renewable energy solutions. We support the renewable energy industry, but when we consider state incentives for such projects under the reinvestment payment program, it is important our incentive reflect the project’s overall impact. Going forward, we will be focused on ensuring incentivized projects, including the end-users of that power, create substantial job opportunities and economic activity in the State of South Dakota [GOED Commissioner Steve Westra, in Bob Mercer, “Westra Explains Why S.D. Board Denied Reinvestment Payment to Wind Farm,” KELO-TV, 2019.09.13].
As I noted last week, GOED dished out 85% of its FY2019 sales and use tax rebates to wind farms, surrendering $609,000 for each job the wind farms claimed to create or retain. Triple H says it will create seventeen to nineteen jobs.
AGP’s soybean plant in Aberdeen has gotten $6.2 million from the state to create 50 jobs, an average tax surrender of $125K per job.
If the government has any business picking winners in the marketplace, dishing out six-figure checks for each job created by a new business—essentially covering payroll for multiple years—is a bigger subsidy than any company deserves. We’ll see if Westra and his boss remember this jobs argument when TransCanada/TC Energy comes begging for a corporate welfare check to subsidize the maybe five or ten permanent jobs the Keystone XL pipeline will create in South Dakota. Then we’ll know if this new restraint is a genuine conservative revolution in South Dakota’s approach to corporate welfare or just a Trumpist whack at the green economy.