Have you heard of the Freeport Amendment?
West Virginia has the Freeport Amendment exempting property from the West Virginia ad valorem property tax in two ways. First, manufactured products produced in West Virginia and secondly, stored as finished goods in the state for a short time before moving into interstate commerce are exempt from property tax.
FirstEnergy pays tax on an ad valorem/value base to the state. The West Virginia Board of Public Works determines the value and the amount of tax (tax break) and distributes the tax to cities and counties. This was verified by the State Auditor’s office. However, Wild Hill Solar would pay the monies directly to Jefferson County, as opposed to Jefferson County having to share the income with other counties.
Based on the information above, how was the $110 million of lost taxes calculated for Wild Hill?
We all pay our FirstEnergy bill, which includes generation, transmission, environmental control, distribution and delivery of electric service. Instead of FirstEnergy paying these fees as part of their business expense, it is passed onto us, along with rate increases. FirstEnergy is receiving a tax break under the Freeport Amendment, and several other tax breaks in place. Yet, we are paying for FirstEnergy to replace and maintain equipment and new technologies, and invest in future building of substations, instead of FirstEnergy paying for their business cost development.
Wild Hill is not charging fees to build the additional and necessary substations, installation of the high intensity wires (which FirstEnergy will benefit from), to replace/maintain or update the solar facility or for new technology. But they are asking to be taxed as a facility that generates electricity. Again, where did the $110,000,000 figure generate from?
Both PILOTs and nameplate capacity taxes use the scale of a solar project to determine the yearly payment amount of a solar development. A production tax requires a solar developer to report the number of kilowatt-hours (kWh) of electricity sold and pay a per kWh fee. The rates and taxing authorities of these forms of payment differ between states; some effectively reduce the cost of solar taxes like exemptions or abatements, the same as coal-fired facilities.
While production of coal has increased in West Virginia, the number of miners has decreased. New, bigger and better equipment makes mining more productive and profitable, while requiring a decreased labor/miner workforce.
The figure of $638,000,000 was also used, when speaking of lost taxes. Again, I ask how this figure was calculated?
Next, the average household in Jefferson County has two cars and, according to the Census and Transportation Bureau, the average daily trips per household are four to five (work, shopping, entertainment and school). So, 200 townhouses is 400 more vehicles, with five daily trips adding up to 2,000 additional trips on roadways.
Now multiply that number by three (200 townhouses per farm in Wild Hill), and that would round out to 6,000 additional daily trips on roadways. Think of the impact for apartment buildings and condos. Think about the need for water for 600 new houses — the average use of 3,400 gallons of water per house a month would amount to a total of 2,040,000 gallons per month.
Prior to the housing boom and currently, Connecticut, Massachusetts nor Florida have decreased home or property values because of nearby solar farms. Not only are there solar farms in these states, but Florida Power and Light has solar farms on the east and west coast of the state. Several other states’ public utility companies, like the one in Massachusetts, now own and operate solar farms/arrays. People selling real estate are still not having an issue with decreased property values. It comes down to your selection of a real estate agent and how well they represent you. I am sure someone will produce a survey listing a few states that may claim to have decreased property values, so I started calling real estate agents in places like Louisiana, Vermont, New York, Oklahoma, Texas, Maine, North Carolina, Kansas City, Colorado, Alabama, Arkansas, Nebraska, South Dakota, Missouri and Illinois. The realtors I spoke with had no problems selling properties near solar farm locations, nor were prices reduced because of decreased property values.
In closing, there are two mythical figures for lost taxes caused by a PILOT Program. First, that FirstEnergy is allowed tax breaks but Wild Hill, Torch and other renewable energy companies cannot. Second, that citizens are trying to weaponize zoning — housing developments do not generate permanent jobs and the economic impact of losing over $28 million to help our county recover lost taxes from foreclosures and businesses closing down, is not truly justified.
Jean Zigler Kotch, of Charles Town