Lobbying state lawmakers is a simple concept to Charlie Burd, registered lobbyist and executive director of the Gas and Oil Association of West Virginia.
“I like green, you like blue, and they’ve got to make a decision. That’s how it works,” Burd said. “They have a decision to make, and you’re trying to convince them green, and somebody else is trying to convince them blue.”
With the West Virginia Legislature’s annual 60-day regular session scheduled to begin Wednesday, Burd’s oil and gas industry association is one of many energy and environmental groups that will try to influence lawmakers with heightened stakes.
Energy producers that already were struggling before the COVID-19 pandemic are worse off nearly a year into the crisis, and now’s the time for industry representatives to intensify lobbying lawmakers for relief.
“The 60-day session sort of becomes the pinnacle of lobbying and educational briefings that take place throughout the year,” said Chris Hamilton, president of the West Virginia Coal Association.
Coal-fired electricity plants accounted for 91% of West Virginia’s power net generation in 2019. Coal accounted for just 23% of the nation’s net electricity generation overall that same year, according to the U.S. Energy Information Administration. Hamilton wants to keep it that way, and is looking to the Legislature to defend the industry against efforts from President Joe Biden’s administration supporting a transition away from coal.
That transition already has been long underway, and West Virginia’s number of coal plants has steeply declined as the Untied States has shifted away from coal toward natural gas and renewable energy.
American Electric Power has retired or sold nearly 13,500 megawatts of coal-fired generating capacity in the past decade, according to Nick Akins, AEP’s chairman, president and CEO. AEP subsidiaries Appalachian Power and Wheeling Power said in a recent filing with the state Public Service Commission that the Mitchell coal-fired generating facility, in Marshall County, would cease operations in 2028, if the companies choose to retire the plant rather than make an additional investment to ensure that it complies with federal guidelines limiting wastewater to continue operating beyond that year.
As the coal industry has declined, so has the Coal Association’s financial resources. The group’s total revenue and membership dues surpassed $3.26 million and $2.64 million, respectively, in 2009, according to a tax filing from that year. By 2019, those respective figures dropped to $1.82 million and $1.37 million.
“The decrease … has been pretty consistent with where the industry has gone here,” Hamilton said. “We’ve lost half of our state’s production in the last couple of years. We’ve made some strides to recover 15% or 20% of what was lost, but we’re still down measurably here, when you compare what we were nine or 10 years ago to where we were last year.”
But the Coal Association’s nondeductible lobbying and political expenditures — which the Internal Revenue Service defines as expenses paid to influence legislation, participate in political campaigns, influence the general public regarding elections or legislative matters or communicate with executive branch officials to influence their official actions — have increased over the past decade even as the group’s overall budget has gotten smaller.
The Coal Association’s nondeductible lobbying and political expenditures rose from $174,681 in 2009 to $282,869 in 2019.
Hamilton said the organization’s political spending levels have been consistent over the past decade. He said the rise in reported expenditures could be from assigning spending differently in the budgeting process.
Regardless, coal remains a critical part of West Virginia’s economy and energy grid, and the Coal Association is poised to continue its history of influence on the state’s energy legislation in 2021 following the retirement of longtime President Bill Raney at the end of last year.
“It’s particularly easy for us when you’re in an industry, as we are, where the formulation of public policy, good or bad, is a constant feature of what you do,” Hamilton said. “I don’t think there’s any other business or industry impacted as much by public policy as much as the coal industry is right now or has been over the past decade.”
The newly constituted Gas and Oil Association is facing its first legislative session after it formed via a merger of the West Virginia Oil and Natural Gas Association and Burd’s old organization, the Independent Oil & Gas Association of West Virginia.
The latter — and larger — of the two organizations has seen its total revenue and membership dues fall from $2.54 million and $1.11 million, respectively, in 2014 to $1.66 million and $867,599 in 2019, according to tax filings.
Burd estimates the two oil and gas groups that formed the Gas and Oil Association once had about 800 members between them, but the group resulting from their merger has only about 600.
But Burd said the merger has made getting legislators’ attention a more straightforward process.
“It … allows you to rely on those personal relationships that members have with legislators or members have with leadership in the House and the Senate,” Burd said. “So yeah, it is enhancing our ability to get in front of legislators, and that’s a good thing for us.”
Burd’s legislative priorities include reconsideration of a bill that passed the Senate last year. That bill would eliminate a cap on deductions for operating expenses oil and gas companies can take against their property taxes, a move that could significantly lower local oil and gas property tax collection.
Another priority is removing tanks containing 210 barrels or less of “brine water or other fluids produced in connection with hydrocarbon production activities” in zones of critical concern from regulation under the Aboveground Storage Tank Act.
The Legislature passed the Aboveground Storage Tank Act in response to the 2014 Freedom Industries spill that contaminated the drinking water of hundreds of thousands of residents in the Kanawha Valley and surrounding areas. The act, which requires an inventory and registration of such tanks, defines zones of critical concern as corridors along streams within a watershed that need close scrutiny because of a nearby surface-water intake point and its susceptibility to potential contaminants.
Angie Rosser is executive director of the West Virginia Rivers Coalition. She opposes any rollbacks of the Aboveground Storage Tank Act, as well as revisions to requirements proposed by the Department of Environmental Protection governing water quality standards that would weaken some of them and await the Legislature’s review this session.
The Rivers Coalition’s annual revenue totals have increased in recent years — as have those of the West Virginia Manufacturers Association, which has criticized the Rivers Coalition’s opposition, arguing that the DEP should use different human health criteria in determining water quality standards.
“Public interest lobbyists are farther and fewer between,” Rosser said.
The same pandemic that has made legislative stakes so high for the energy sector also has made it harder for sector representatives to lobby lawmakers in person, as the Capitol remains closed to the public. But lobbyists are adapting to a virtual approach and, on the eve of a new legislative session, they are looking to extend their outreach and help shape the agenda.
“Having the debate is what’s important,” Burd said.