Locust Ridge Wind Farm owner Joe Green, of Shenandoah, would like the Mahanoy Township Board of Supervisors to give him a tax break on his wind energy enterprise.
He would even be willing to give the township a share of his profits in exchange for a break in taxes.
Tax law, however, prohibits local government from agreeing not to tax somebody. That’s the legislature’s job, according to township Solicitor Victoria Edwards.
Even in the absence of a tax break, Green would still like to give something back to the township for its accommodation of the area’s first natural energy wind farm. Edwards reported Thursday at the regular monthly meeting of the board of township supervisors that Green has offered an $18,000 annual gift to the township.
Pennsylvania law exempts the windmills from real estate (property) tax and provides for tax revenues only on the lease value of the land upon which the windmills stand.
“Windmills cannot be taxed as a property improvement. The windmill is considered personalty. What is taxable is the income capitalization approach. The value of the lease is that they can tax,” Edwards said.
“The tax assessment office has inspected the site. There is a building on the land, which will be taxed as real estate. Then, there is also the windmills, which the tax assessment office will get the value of the lease and tax that.”
Green currently leases the Locust Ridge land from Philadelphia-based Girard Estates.
Twelve of the 13 Locust Ridge windmills are situated within Mahanoy Township boundaries. The 13th windmill is within Union Township.
According to Sharon Chiao, chairwoman of the board of supervisors, Green currently has plans under way to construct another 13 windmills in the vicinity of the Locust Ridge Wind Farm.
Chaio said the agreement on the table before the board of supervisors regarding Green’s intentions to gift the township $18,000 annually pertains only to the 12 existing windmills in Mahanoy Township.
Any gifts associated with future windmills would not fall under the current agreement. Rather, gifts pertaining to any new windmills would require a new agreement, Chao said.
“Twenty-six windmills is a lot different than 13 windmills,” Chaio said.
According to Edwards, Green is offering the township money because he simply wants to give back to the community.
Initially, Edwards said, the agreement proposed by Green offered an annual financial gift to the township in exchange for tax forgiveness. However, even in the absence of the township’s legal ability to forgive taxes, Green still wants to share his good financial fortune with the community.
“Some people think if there are going to be additional windmills, he should give us additional money. But I think we’re kind of lucky that he’s giving us $18,000 to begin with because he doesn’t have to pay us anything,” Edwards said.
According to Supervisor James Stevens, Green is exploring the feasibility of constructing 13 additional windmills on nearby land owned by the Mahanoy Township (water) Authority.
“If feasible, the next towers are going up on water authority land. Once he gets the go-ahead there, he will pay a land lease to the water authority,” Stevens said.
Stevens said windmill projects are also being considered for ridges in the Shenandoah area. However, most communities are closely watching the Locust Ridge project before making final decisions on granting wind farm construction.
“We’re like an experimental model as far as income and what happens,” Stevens said.
Green’s offer of an annual gift to the township, Edwards said, is an effort to show communities wind energy farms are good neighbors so that communities would welcome them in and be willing to provide the fire protection, police protection, road easements and other services necessary to construct the windmills and conduct business.
Green was out of town on business Thursday and unavailable for comment.
By Mia Light
18 May 2007
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