Tax credit for natural gas cars moves to Senate
By Mike Hasten • mhasten@gannett.com • June 4, 2009

BATON ROUGE — Encouraging natural gas use for automobiles would be good for the state economy and the environment, Rep. Jane Smith said Thursday.


The House approved her House Bill 110 that offers tax credits she says could spur the development of natural gas-powered vehicles and filling stations.

“Natural gas is a clean-burning fuel,” Smith told the House, and with the monstrous Haynesville Shale development in the northwestern part of the state, it’s going to be in bountiful supply for years to come. And with oil supplies in the United States on the decline, “it’s almost a matter of national security” to find alternative fuels.

HB110 increases the individual and corporate income tax credit for the purchase of a qualified clean-burning motor vehicle, the purchase and installation of equipment to convert a gasoline or diesel engine to burn natural gas and to develop a dispensing location.

The cost estimate of HB110 is $164,000 the first year, growing to $200,000 by 2013-14, the Legislative Fiscal Office report shows, but it contains qualifying language.

“The bill would pay for 50 percent of the costs of fueling-dispensing equipment,” the report says. “If gas stations add this equipment or firms operating vehicle fleets add this equipment, the costs of this credit could increase substantially.”

The 11 opponents in the House questioned why the natural gas tax credit should receive preference over others that are being bottled up in the House Ways and Means Committee and whether the state should be granting credits when it’s cutting higher education and health care.

Smith answered that some credits “rise to the top” but “I know mine’s competing with all the others.” She said she has received numerous inquiries from investors interested in coming to the state and the Department of Natural Resources estimates natural gas production could be a $3 billion industry.

Rep. Barbara Norton, D-Shreveport, said the tax break would “bring more funds in than what we’re putting out.” She encouraged the House to “vote for the future.”
Rep. Sam Jones, D-Franklin, said he supports the measure because “it’s an investment, and it’s one quarter of 1 percent what we spent on the Saints.”

“We have the opportunity in the state of Louisiana to be a national leader in this,” Smith said when she introduced the idea. “We have something that’s abundant, it’s clean and it’s American.”

Sen. Nick Gautreaux, D-Meaux, has an identical bill awaiting a hearing in the House Ways and Means Committee.


Buck