Wilson OKs Measure Providing Tax Break for Solar Energy Firm


After an unusual pause to rethink his position, Gov. Pete Wilson on Tuesday signed into law a controversial bill that gives a $6.4-million property tax break to a company building solar power plants in the Mojave Desert.

“California leads the nation in the development and production of solar energy,” Wilson said. “But without the property tax incentives, progress will be slowed.”

Only three weeks ago, Wilson sent the measure back to the Legislature asking for possible amendments and changes. On Monday, the state Senate without debate sent the identical bill back to the governor for his signature.


Critics had attacked the bill, sponsored by Sen. Becky Morgan (R-Los Altos Hills), as a tax giveaway at a time when state and local governments were in the middle of a financial crisis.

But Morgan and the bill’s benefactor, Los Angeles-based Luz International, argued that the measure was good environmental policy and in reality cost nothing. Luz officials argued that without the property tax exemption, the company would not be able to build four solar power units at a cost of about $200 million each near the town of Boron.

A handful of legislators objected, arguing that investors in the solar power plants reap the benefits of state and federal solar tax credits and did not need the additional property tax cut of $1.6 million a year per plant.

Wilson agreed with the bill’s supporters.

Said Wilson’s press secretary, Bill Livingstone: “Without the property tax exemption there wouldn’t be construction of the four new plants to begin with.”

Livingstone said the governor delayed action on the bill because he needed more time to check the claims that it would not mean a loss of state revenue. “You really had to test it,” he said.

A similar bill was vetoed last year by then-Gov. George Deukmejian.

The company, which manufacturers parts for its solar plants in Israel, paid more than $40,000 in campaign contributions over the last three years, including $3,000 to Wilson.