News Brief: Mass. Senate passes omnibus clean energy bill; Pignatelli helps pass Hogan Agricultural Estate Tax

State Senate passes omnibus clean energy bill

Boston — Sen. Adam G. Hinds, D- Pittsfield, has announced that the Massachusetts Senate voted 35–0 Thursday to pass omnibus energy bill S.2545, “An Act to promote a clean energy future.” The legislation represents a firm stand by the state Senate to ensure a healthier, cleaner Commonwealth for future generations of Massachusetts residents. Most importantly, the policies enacted in the legislation will have measurable benefits in the health of the global environment.

“Since this session began 18 months ago, I have consistently received calls, emails and letters urging the advancement of forward-thinking renewable energy policy,” said Hinds. “More than 300 constituents have engaged with my office on this matter.  This legislation prepares Massachusetts for the inevitable obstacles that will come with climate change. Its policies and programs will protect public health, increase the use of renewable energy, reduce greenhouse emissions, implement a price on carbon, and create jobs in the innovative green-energy economy.”

On June 19, 2017, Hinds hosted a public forum at Berkshire Community College in Pittsfield as a part of the Senate’s Clean Energy Future Tour. Public comment received during this statewide public comment-gathering tour was used to develop the legislation.

S.2545 raises renewable portfolio standards, lifts the cap on solar net metering, authorizes additional hydropower and offshore wind procurement, establishes market-based greenhouse-gas emission limits, and implements statewide energy storage goals.

During the debate, Hinds secured passage of three amendments he sponsored seeking to reform aspects of Department of Public Utilities proceedings regarding gas pipeline contracts and to ensure heavy energy-using employers in low-income areas and Gateway Cities are not disproportionally impacted by the implementation of new climate change and renewable energy regulations in Massachusetts.

On the floor of the Senate Chamber, Hinds outlined why DPU reform was necessary, siting the Kinder Morgan Tennessee Gas Pipeline Company’s successful quest to fell trees and build a portion of its 13-mile, tristate Connecticut Expansion Project through Otis State Forest in Sandisfield above the objections of residents and local, state and federal officials and against the tenets of Article 97 public open-space protections.

Image courtesy the office of Sen. Adam Hinds.

Hinds’ Amendment 60 creates new standards the state DPU must consider when reviewing gas pipeline contracts to ensure ratepayers and private and public land are protected. Hinds’ proposal mandates the DPU take into consideration the project’s impacts on public health, the environment and climate change. Further, to ensure local community interests are protected in these proceedings, Hinds’ amendment requires the DPU to grant “intervenor status” to ratepayer municipalities, state legislators and groups of 50 or more ratepayers of the utility who wish to closely follow ongoing DPU gas pipeline proceedings.

When the Kinder Morgan Tennessee Gas Pipeline Company’s Northeast Energy Direct pipeline proposal was under review, such interested parties were not granted intervenor status and were not able to participate in the proceedings as closely as they wished.

Hinds’ other amendments ensure investments in renewable energy identify and mitigate negative impacts on manufacturing, economic sectors and individual employers as a result of carbon pricing (No. 14); and direct Energy and Environmental Affairs reporting to consider impacts of climate change regulations on economically distressed areas (No. 68).

Other specific policy changes in the bill include:

• Increasing the percentage of Class I renewable energy that must be purchased by retail electric suppliers under the Renewable Energy Portfolio Standard from an additional 1 percent annually to an additional 3 percent annually;
• Requiring the secretary of Energy and Environmental Affairs to establish market-based compliance mechanisms to maximize the ability of the Commonwealth to achieve its greenhouse gas emission limits for the transportation sector no later than Dec. 31, 2020; the commercial and industrial building sectors no later than Dec. 31, 2021; and the residential building sector no later than Dec. 31, 2022;
• Requiring the secretary of Energy and Environmental Affairs to adopt statewide greenhouse gas emissions limits for the years 2030 (35 percent and 45 percent below the 1990 emissions level) and 2040 (55 percent and 65 percent below the 1990 emissions level), and a plan to achieve those reductions;
• Requiring the 2030 emissions limit to be adopted no later than 2021 and the 2040 emissions limit to be adopted no later than 2031;
• Requiring the secretary of Energy and Environmental Affairs to issue a plan to achieve the 2050 emissions limit;
• Requiring the Department of Energy Resources to establish an energy storage system target program to achieve a statewide energy storage deployment target of 2,000 megawatts by Jan. 1, 2025;
• Removing the net metering cap for nongovernmental solar net metering facilities;
• Eliminating the current sunset date of Dec. 31, 2020, for the regulations promulgated under the Global Warming Solutions Act;
• Creating a joint procurement taskforce consisting of the Department of Energy Resources, the attorney general and representatives of the distribution companies, to conduct a review of the clean energy procurements; and
• Allowing the Department of Energy Resources to recommend solicitations and procurements for more than 9,450,000 megawatt hours of clean energy generation, and to recommend offshore wind energy generation solicitations and procurements of up to 5,000 megawatts of aggregate nameplate capacity by Dec. 31, 2035.

The bill now goes to the House of Representatives for consideration.

*     *     *

Pignatelli helps pass Hogan Agricultural Estate Tax

Boston — Rep. William “Smitty” Pignatelli, D-Lenox, joined Rep. Kate Hogan, D-Stow, and colleagues in the Massachusetts House of Representatives to pass a bill that aims to preserve family farms across the Commonwealth.

H.3915, “An Act to establish estate tax valuation for farms,” would change the method for assessment of the estate tax valuation for agricultural land. Pignatelli worked with Hogan to include the agricultural estate tax reform bill as part of a larger environmental bond bill that seeks to address the Commonwealth’s climate-change preparedness and response plans.

“The agricultural estate tax is possibly one of the most important pieces of legislation impacting our farmers,” said Pignatelli, who chairs the Joint Committee on the Environment, Natural Resources and Agriculture. “Passing this tax reform will help ensure a thriving agricultural economy here in Massachusetts by making it more affordable for future generations to continue farming, instead of selling off the land for development.”

As written, Massachusetts estate tax laws can force farmland into development. When a relative passes away and a person inherits farmland, very often they are subject to an estate tax bill that can be quite costly. This is because inherited farmland is taxed under the estate tax laws based on its “highest and best use”—or the most profitable use of that land—which is development, not agriculture. As a result, many people who inherit farmland end up selling portions of the land in order to pay the estate tax.

To encourage owners to keep their farmland in agriculture, the agricultural estate tax reform offers a person inheriting farmland options for how their estate is taxed. Upon property transfer, both the “agricultural” use value and the “highest and best” use value of the land would be determined. If a person inherits a farm and they choose to have the land valued based on its current use, for the purposes of estate taxation, the resulting estate tax bill would be lower. If the owner decides to sell the land within 10 years for purposes other than agriculture, he or she would then pay back taxes for the remaining period of the 10 years. Those back taxes would bridge the difference between the lower estate tax bill, based on the land’s “agricultural” value paid at the time of inheritance, and the more expensive “highest and best” use value that was also determined but not paid. The change would offer individuals who have recently inherited farmland the flexibility to keep the land in agriculture without being burdened by an estate tax if they cannot afford it.

The final vote on the Environmental Bond Bill was 143–3. The bill will now be sent to the Senate Committee on Bonding, Capital Expenditures and State Assets and the Senate Committee on Ways and Means before being taken up for a vote by the full Senate body.