This isn’t the first time Coos County citizens have been sold on the promise of jobs and economic revitalization by local business leaders. When I moved here in 2003 the State legislature had put the finishing touches on a bill to allow a natural gas pipeline deemed so critical to economic development in the area it was rushed through under “emergency clause in the legislation that allows for it to go into effect immediately upon the governor’s signature”.

Senate Bill 0321, which gives the Public Utility Commission the authority to approve a contract negotiated between Coos County and NW Natural, received a 59-0 approval by House members.

Wearing a bright yellow hard hat on the House floor, Rep. Joanne Verger, D-Coos Bay, urged the House to pass the bill and remove the legislative hurdles to the construction of the pipeline.

“SB 321 takes care of the last piece of housekeeping business for the Coos County pipeline,” Verger said.

In July, 2004, The World newspaper reported on the boost to the economy anticipated by the natural gas pipeline.

A $51 million pipeline could bring millions of dollars of business to Coos County and revitalize the largest metropolitan area in the West still without natural gas, county officials say…

…For years, economic development officials in Coos County have insisted that the pipeline is necessary to attract companies already drawn to its deep-draft port and inexpensive real estate. The lack of natural gas kept companies like U.S. Gypsum moving the area.

“They’ll ask you, ‘Where’s natural gas?”‘ said Martin Callery, the port’s marketing director. “They’ll say, ‘Call us when it’s here.”‘

Now, he said, the pipeline will give Coos Bay the chance to reinvent itself – much like Bandon, which landed a world-class golf resort, and Florence, which has become a magnet for retirees.

Then director of SCDC, the late Ron Optiz told The World “more than one company has expressed interest about moving into the area once the pipeline is in.”

By January 2004, The World was reporting on all the money being poured back into the local economy via local equipment rentals and how the imported work crews, Henkels & McCoy, were regularly eating lunch at Bay Area Senior Activity Center increasing their business ‘quite a lot’.

Coos County was also promised earnings from the delivery of natural gas.

Coos County is expected to benefit rate-wise from the pipeline.

According to an agreement between NW Natural and Coos County, NW Natural will ship and distribute natural gas to customers and pay a 1-cent-per-therm transportation fee.

But the transportation fee isn’t where the county hopes to make money, according to Coos County Commissioner Nikki Whitty.

“We never did this as a project for the county to make money on the transportation agreement,” Whitty said. “We did it as an economic incentive to get (vacant) properties on the tax roll. [Emphasis mine] Someday there will be money from the transportation fee, but not for a while.”

Such were the promises made by the leaders and duly reported verbatim by the local paper that Coos County citizens agreed to $27M in bonds to help pay for the pipeline. By 2007, things had gone terribly wrong, so wrong that Coos County taxpayers were performing their own mini version of the TARP Wall Street bailout

Coos County has yet to realize consistent profits from its natural gas pipeline, but thanks to an Oregon Supreme Court ruling in 2006, it collected about $50,000 in property taxes on the line last year, despite being its owner.

The taxes were paid by NW Natural, the company that maintains and operates the pipeline. Fearing the county might find itself paying the tax in the future, however, county commissioners joined with the power company to lobby for legislation to remove the pipeline from the tax rolls. [Emphasis mine]

House Bill 3046, supported by all of the elected representatives of the South Coast, did just that…

…
NW Natural will still pay property taxes on the distribution system it owns in Coos County, but not on the pipeline, which had an assessed value in Coos County of about $33 million.

Coos County Commissioner Nikki Whitty said it was only fair to support the legislation.

Fair to whom, certainly not the taxpayer sold this boondoggle in the first place, the article goes on to explain why the taxpayer is bailing out NW Natural for making bad business decisions. Free market advocates should take note in a truly free market, the taxpayer doesn’t bail you out.

Gary Bauer, director of government affairs for NW Natural, said the company has a 20-year plan to make their entry into the area profitable, but as of last week, they only had 801 customers.

“It’s definitely not profitable today,” he said.

He also noted that the company does not make any profit from maintaining the pipeline, receiving about $24,000 a year from the county. Whitty said the county essentially exchanges checks, as it charges the company a similar fee to transport gas along the pipeline.

Despite these factors, the Department of Revenue declared NW Natural was responsible for paying property taxes on the pipeline.

After several discussions with state economists, NW Natural was able to convince the Department of Revenue to reduce its tax obligation to a nominal amount. But the department could not remove the pipeline completely from the tax rolls.

To do this, Bauer went before the House Revenue Committee and requested legislation to accomplish this.

Now, the same people who brought us the pipeline and sold it to us via reconstituted press releases presented as news at The World are trying to pull the same marketing gimmick with strip mining and jobs and all the glowing benefits to local companies like West Coast Contractors (did they bid for the ORC work?).

The media in West Virginia paid homage to big coal and covered for all the raping, plundering and pillaging and human sacrificing that was rampant in the industry to keep the workers uninformed. There is too much to write about in one post so I will get more up soon but it is starting to feel like this is what is happening here as well.

Several readers have contributed research to allow me to put this up tonight and I have an inbox full of lots more for several eye opening posts over the next few days.

Thanks to everyone who has been helping, keep that info coming