Day 104: What's the matter with Kansas?

On my first day in Kansas, I walked a country road to the medium-sized town of Washington, situated just a mile or so from the Keystone Pipeline that was built in 2010.

I left the country road and headed for town. A large man was walking with two mammoth St. Bernards. The St. Bernards ran up to me, and I asked their owner where I might find a spot in town to set up my tent. He asked me what I was doing, and I asked him what the people in town thought of the pipeline.

“Well, there are pros and cons,” he said. “People are pretty upset about the exemption.”

“The exemption?”

“Yeah. For some reason Kansas decided to give TransCanada a 10-year exemption. That means TransCanada don’t have to pay no property taxes. We were the only state to do that.”

“So what are the pros?” I asked.

“Well…” he said, pausing to think. “I guess there aren’t any.”

An exemption? That made no sense to me. The 2010 Keystone Pipeline goes through 10 states and provinces, yet Kansas is the only one to give them an exemption. (South Dakota also gave them exemptions, but those weren’t nearly as generous as Kansas’s.) All the other states tax TransCanada and make millions of dollars from those taxes. That’s why states like pipelines: They get money. How much money Kansas is missing out on is unclear, but several sources say it’s upwards of $20 million a year.

I did a little research and found out that Kansas gives 10-year property tax exemptions to energy companies to lure them into the state. But this exemption still made no sense because Keystone had to come through Kansas anyway so the pipe could reach the refineries in Cushing, Oklahoma. Plus, TransCanada spokesman Terry Cunha has gone on record, stating:

[TransCanada didn’t] originate this tax abatement issue. We weren’t part of that discussion. We were already in the process of finalizing our proposed route.

When I stopped in Marion County, Kansas, I was told that there was one guy who would be able to answer all of my questions about the Keystone in Kansas. I met with and interviewed County Commissioner Dan Holub in the lobby of the local police station.