UPDATE: Herbert has signed the bill. He’s bailed out his buddies and created a new, cloaked and uncontrolled taxation vehicle. Progressives rejoice.
Who can say they don’t want clean air? So that should justify any action that would creates a government-ordained monopoly and open a larger avenue for tax increases that entirely undermine truth-in-taxation? Apparently. Just look at the end result of SB275 (“Energy Amendments”).
The legislation gives Questar (“a gas corporation”) a virtual monopoly on CNG (natural gas) stations and infrastructure. CNG vehicles are an increasing market and prime for expansion. Rather than allow free enterprise and businesses (small and large) to enter the market and ensure competition, the legislation will strangle the market and provide significant advantage for what will amount to a state utility company (Questar). Instead of using a competitive process for infrastructure and allowing gas stations meet CNG demands, the legislature and Governor Herbert are primed to severely restrict entry in the market. All this amounts to is a juicy shade of big government intervention and crony capitalism.
As a “double whammy”, the legislation allows all layers of government to increase gas rates (“in the public interest”, of course) when they feel like it. As I’ve well documented Utah cities with a municipal power company are notorious for manipulating rates (overcharging) and transferring the excess into their general funds (see here too). They then turn around and speciously tout low property taxes (without factoring in the rate manipulation). If signed by Governor Herbert, the barn door will be thrown wide open for not only cities but also counties, special districts, and the quasi-private Utah Transit Authority (UTA). This action will also surreptitiously help bail-out a financially foundering Utah Transit Authority.
The end result is and end run around truth-in-taxation requirements, gas rates for your home as well as CNG vehicles will rise, and government runs on the Questar bank (while claiming your taxes are low)…with the added bonus of a constriction of market entry and competition. Milton Friedman in “Free To Choose” warned about the unintended consequences of government-corporate regulatory development. This is just another case study in the making.
Please call Governor Herbert (801-538-1000) immediately and ask him to veto SB 275 (this is your last chance). Too late – see the update at the top.
For more detailed background information, see this post.