Grid Grift
Nobody understands the blather Northwestern Energy is spouting to explain its plans for Colstrip, a subsidiary, customer credits, and … perhaps … bivationary falvebarms.
Introducing Redneckeconomics
Tired of slick pundits telling us how the economy works? Looking for economics for people who wear “boots not suits?” Well, here it is. From their Facebook Page . . .
“We’re done letting billionaires and lobbyists write the story. Roughcut tells it straight – how every policy, every deal, every dollar really lands on working folks. Loud. Gritty. Unfiltered. Forever working class, and never kissing ass.”
This is a video featuring Lee Calvin, a country musician and “folk economist” from Red Lodge Montana. Calvin talks about people criticizing farmers because so many of them voted for Trump. It’s just three minutes long and well worth a listen.
Check Rough Cut Media
On YouTube– ww.youtube.com/@RoughcutMediaNetwork
On Facebook- https://www.facebook.com/profile.php?id=61579181833658
Here We Go Again
This editorial was sent to newspapers across Montana.
What is it about top executives in monopoly utilities that makes them want to play cowboy capitalists? Case in point is NorthWestern Energy’s plan to provide power to gigantic data centers. With great ballyhoo across the state, NorthWestern Energy announced it signed a “letter of intent” to provide as much as 1,000 megawatts of electricity to Quantica Infrastructure for its proposed data center. That’s more than their current total electric load of 760 megawatts. That amount of power would use all of NorthWestern’s existing generation capacity.
You would think that this monopoly business and its top brass would be satisfied with its current situation. In exchange for providing power to its current customer base (that’s us), they receive a virtual guarantee they will not lose their investment for any reason. They also get a guaranteed rate of return on their investments that hovers around 10%. That is for the entire life of the facility regardless of economic conditions or competition.
In exchange for running this sleepy little monopoly, which is headquartered in Sioux Falls, South Dakota, their current CEO, Brian Bird, received $4.8 million in 2024. The 2023 corporate proxy statement lists Board Chair Linda Sullivan receiving an annual retainer of $150,000 plus 3,750 shares of stock. Current price per share is around $55. For comparison, the manager of Flathead Electric Cooperative, the largest public power provider in Montana, receives just under $550,000 per year.
But now NorthWestern wants to take on a lot of risk building new facilities and making investments betting on the latest fashion trend to come down the pike: data centers. And if they miss their bet, we all suffer the consequences. Maybe the business booster crowd needs a history lesson.
In 1971, the Bureau of Reclamation released the North Central Power Study. The plan called for massive coal development on the northern plains. In Montana alone, they envisioned 17 coal plants roughly the size of the Colstrip plants. Of course, the Montana Power Company (NorthWestern Energy’s predecessor) and other corporate interests in Montana were all for it. For them, the environmental degradation and negative impact on existing ag producers and others were worth the cost.
But ranchers, Native tribes, and many others were not convinced. They organized to oppose the massive development being proposed by the coal and utility industries. In the end, only four plants were built and owned by a consortium of utilities. It also spawned two of the most powerful citizen groups in the state: The Montana Environmental Information Center and Northern Plains Resource Council. To this day, they remain actively engaged in protecting Montana’s people and environment from corporate interests seeking a quick dollar.
Fast forward to 1997 and the electric deregulation fiasco. Management of the Montana Power Company became bored with the stodgy old regulated utility business. So they decided to sell off the power plants and power lines they owned. They took all of that money and dumped it into Touch America, a fledgling telecommunications company. In short order, Touch America went bankrupt and all of that money evaporated. Montana suffered through years of economic chaos. We went from some of the lowest customer rates in the country to some of the highest rates in the Northwest. NorthWestern is now proposing significant rate increases on a regular basis, while still trying to acquire worn out, expensive coal plants in the Colstrip complex.
In the emerging world of huge data centers serving everything from artificial intelligence to cryptocurrency ponzi schemes, NorthWestern sees a new shiny object on the horizon: huge electric loads required by data centers. Unfortunately, this confronts us when the national government is run by delusional ideologues. Here in Montana, billionaire tech moguls and far-right legislators are running state government. The Public Service Commission, which should be protecting us from the greed of corporate CEOs, looks more like the clown show in a three-ring circus.
Strap in and hold onto your wallets, folks. It’s gonna be a wild ride.
Ken Toole served on the Public Service Commission from 2007 to 2011. He was a member of the Senate Energy and Telecommunications Committee, serving as its chairman in 2005. He served as the vice chair of the Senate Taxation Committee in 2005. He was also the President of The Policy Institute, a private group which conducted research on economic issues including energy and taxation.
How Large Industrial Corporations Like Calumet are Screwing You.
In this post we are focusing on the games large corporations play on property taxes and “appraised values.” We’ve already written about Calumet’s shenanigans in receiving reductions in property taxes with the help and support of local Republican legislator Steve Fitzpatrick and Attorney Kim Beatty, wife of the Director of the Department of Revenue. https://wtf406.com/2025/04/calumets-got-lawyers-and-politicians/
The Goal of All Property Appraisal is to Establish the Market Value Of The Property
The first step in determining how much you will owe in property taxes is determined by the appraised value of your home, land, business, or rental. That value is determined by the Montana Department of Revenue’s appraisal process. The most common way the Department of Revenue determines the value of your home is to identify comparable property in your area that has sold. It is determining the “market value” by looking at sales of similar property.
Three Methods of Appraisal to Determine How Much a Property Is Worth
It is harder to find “comparable sales” for large industrial facilities like Calumet, because they do not sell as often and there are far fewer of them to use as comparisons. There are other ways to establish the market value. In addition to the comparable sales method, there is also the “cost approach” which adds the cost of land, buildings and other improvements and adjusts for condition of facilities to determine the total value. The third method is the “income approach.” In this system the appraiser looks at the income and expenses generated by the property. Calumet and other refineries are generally appraised using the “cost approach.”
Here’s The Game They Play. . .
If a property owner does not agree with the Department of Revenue’s appraisal, there is an appeal process through the Montana Tax Appeals Board. That process allows the Department of Revenue and the appellant (say, Calumet) to negotiate a voluntary settlement. Calumet and other refineries in Montana routinely appeal their valuations and routinely enter settlements with the Department of Revenue which result in lowering their taxes. None of the negotiation meetings are public. And when their taxes are lowered, your taxes go up. For a complete explanation of how this works, follow the link below. https://dailymontanan.com/2023/07/26/big-corporations-get-tax-benefits-while-montana-resident-get-higher-property-taxes/
2012 Showdown In A Legislative Committee
Dan Bucks, the Department of Revenue Director under former Governor Brian Schweitzer, refused to play this game. Instead, he defended the appraised values by the Department of Revenue rather than entering settlements. Not surprisingly, big corporate taxpayers, like refineries, didn’t like Buck’s approach. In September 2012, three refineries attempted to set him up in front of the legislative interim committee on Revenue and Transportation in a failed attempt to apply political pressure.
At the same time, Connacher Oil and Gas Limited, the previous owners of the Great Falls refinery, reached a deal with Calumet to sell the refinery for $120 million. That purchase established the actual market value of the refinery. The Department of Revenue had appraised the value of the refinery at $70 million, and Connacher Oil had appealed that appraisal, arguing it was too high even though it was $50 million below the actual purchase price paid by Calumet. Below is an audio clip of Bucks explaining the issue to the legislative committee.
Our Local Elected Officials Need to Represent Us, not Big Corporations
Too often local elected officials pander to these big corporations. Beware of politicians who talk about the economic benefits of “industrial development.” Too often we get taxes shifting more and more to residential and small business and underfunded public services. We need more people in government like Dan Bucks. We won’t get them if we (the public) don’t demand that the tax system is equitable and transparent and companies like Calumet pay their fair share.