Municipalities, not schools, would get largest share of wind farm pie.
Town officials convinced that wind farms are coming to Jefferson County are jockeying to see if they can divert millions of dollars in potential tax revenue to their governments and away from school districts, which generally would receive the majority of taxes raised from the creation of each turbine.
In an average payment-in-lieu-of-taxes (PILOT) agreement, school districts can expect to receive from 50 percent to 60 percent of property taxes from any given property owner. Jefferson County would receive the next-highest amount and towns would get the least.
“A pure ratable distribution would have the most favorable impact on the school districts,” said Paul J. Warneck, director of county real property services.
But town officials aren’t sitting back and waiting for standard PILOTs to be approved. They are arguing for “host-community agreements,” with thousands going straight to towns.
If such a scenario played out with Horse Creek Wind Farm, for instance, the town of Clayton could see its piece of the pie increase from 6 percent to 42 percent, while the Thousand Islands Central School District’s share would drop from 57 percent to 35 percent.
Remaining mum are superintendents from the school districts that could be affected by the towns’ host-community agreements. Susan L. Whitney of LaFargeville Central School, John E. Slattery of Thousand Islands Central, Donalee K. Dodson of Lyme Central School, Chaumont, and Frederick E. Hall Jr. of Sackets Harbor Central School all told the Times that they haven’t formed a response yet.
According to an example provided in November by Horse Creek Wind Farm developer PPM Atlantic Renewable, local officials could expect $8,000 per megawatt from the developer in a tax-break package. If the project stayed at its current 126 megawatts, the taxing jurisdictions would be splitting about $1 million each year for 15 or 20 years.
According to the 2007 tax rolls, the Thousand Island Central School District received 57 percent of all property taxes within its district borders, Jefferson County received 37 percent and the town of Clayton received 6 percent.
(The LaFargeville Central School District and the town of Orleans also will receive money from a tax-break agreement).
Using the Thousand Islands district numbers, if a deal followed a normal PILOT agreement, the school districts could expect about $570,000, the county $370,000 and the towns $60,000.
But also in the November example, the developer included $5,000 per megawatt as a PILOT agreement and $3,000 attached to a host-community agreement, all of which would go to the towns.
Using the distribution rates under that type of agreement, the school districts would receive about $350,000, the county $235,000 and the towns $415,000. That means the school district would receive about 35 percent of the overall tax agreement and the county about 24 percent, while the town would get about 42 percent.
Clayton Supervisor Justin A. Taylor said the example was given for comparison, and was not an actual offer.
“We had asked for an example of what type of agreement they had produced in other areas,” he said.
The developer has not set an amount that the company could afford on a tax-break agreement for Horse Creek Wind Farm. But, Mr. Taylor said, the town is discussing “total dollars” with the county and applicant. The details of the latest distribution ideas and negotiations are “not for public disclosure.”
A host-community agreement may or may not include money for the town, he said. A typical host-community agreement will include rules for decommissioning turbines and road use.
Many have a financial aspect, too. Another option for the towns would be to negotiate a larger share of the PILOT agreement based on environmental or other impacts from the project. In that type of agreement, school districts, the county or both could lose tax-break money.
Mr. Taylor said the town of Clayton is considering hiring a consultant to look at the economic effects of the wind farm on the town. He said the town already has hired consultants to look at the wind data provided from test towers and to make archaeological studies.
By Nancy Madsen
Times Staff Writer
27 March 2008
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