Idaho Senate Committee Approves Areva Bills

By Kovsky, Eddie

After more than three hours of testimony and debate, the Senate Local Government and Taxation Committee approved two tax incentive bills designed to attract the French nuclear energy firm Areva to eastern Idaho. Areva is interested in building a uranium processing facility near Idaho Falls. Idaho is one of five sites the company is considering.

The first bill will exempt processing materials used for the production of energy from sales and use tax.

The second bill caps the taxable property value at $400 million for projects that involve an investment of $1 billion or more. This is a better deal than the property tax exemption Micron Technology currently has, which sets the cap at $800 million.

The bills’ sponsor, Tim Solomon, executive director of the Regional Development Alliance in Idaho Falls, said Areva’s facility could bring 1,000 jobs to the region during the construction phase and another 250 permanent jobs to operate and manage the facility when it’s finished.

Areva has not yet selected Idaho, but the legislation could open the doors to additional investment opportunities from companies outside the state, Solomon told the committee.

Though bills passed, the property tax exemption narrowly made it out of committee.

Several senators were concerned the exemption was not sound tax policy.

“More than 80 percent is excessive,” Sen. David Langhorst, D- Boise, said. “When will exemptions end? Why do we have to give away the farm? If I were at Micron, I’d come back next year and expect to have my taxes lowered.”

Areva claims the facility will be valued at $2.5 billion, which means they would only pay property tax on the first 16 percent of assessed value.

“We’re engaged in a business negotiation here,” Sen. Joe Stegner, R-Lewiston, said. “Idaho doesn’t need to race to the bottom to attract any and all business to compete with some unknown. This proposal is too good a deal. We’re reaching too far.”

Stegner introduced a motion to amend the exemption cap to $800 million, but the committee instead voted to send the bill to the full Senate without changes.

Credit: Eddie Kovsky

(Copyright 2008 Dolan Media Newswires)

(c) 2008 Idaho Business Review, The. Provided by ProQuest Information and Learning. All rights Reserved.