Texas Land Commissioner David Dewhurst last week presented aplan to a special senate committee on electric utilityrestructuring that would allow the land commissioner to convert thestate’s oil and gas earned from public lands into electricity andsell it to Texas schools, state agencies, and local governments.

“The money the state makes from its public lands isconstitutionally dedicated to education,” Dewhurst said. “This plancould reduce the operating costs of some of our schools andgovernment agencies – and at the same time increase the earningsfor our school funds by 30%.” Dewhurst said in-kind royaltypayments raised almost $140 million for the state’s PermanentSchool Fund and Permanent University Fund in 1998. He said his plancould dramatically increase that amount.

Dewhurst’s plan is not the first time the idea has beensuggested. Previous land commissioner Gary Mauro also suggested theidea, and former lieutenant governor Bob Bullock made thesuggestion several years ago.

If Dewhurst’s plan were adopted, Texas would ship gas and oilfrom state-owned lands to independent power producer plants wherethe fuel would be converted to power. The plan would allow thestate to generate power at a below-market price and sell it toschools and state agencies below what they currently pay. Texas hasaccepted in-kind royalty payments for its share of oil and gasproduction from state lands since 1973.

Joe Fisher, Houston

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