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Freedom tries to assess value of wind farm  

Credit:  By Erin Rhoda, Staff Writer, Morning Sentinel, www.onlinesentinel.com 19 January 2011 ~~

FREEDOM – The town faces a $1.4-million question: How does it assign value to a commercial wind farm that is different from any other in Maine?

Wind project developer Beaver Ridge Wind LLC says it overpaid about $14,000 in property taxes in 2010 because assessors overstated the value of its land.

In the first known request of its kind by a wind developer in the state, the company – owned by Patriot Renewables, of Quincy, Mass., in partnership with Maine’s MIRSAP LLC – has asked that its property with three turbines be valued at about $9.43 million, nearly $1.4 million less than its current assessed value.

Assessing a wind farm, however, is a difficult task with many variables, those involved with the effort said.

“My goal was to establish the correct assessed value for the project,” said Todd Presson, chief operating officer of Patriot Renewables. “We want to be treated like everyone else.”

The company is not requesting reimbursement, however, for what it believes it overpaid in 2010 taxes. If its request is granted, the change would occur in 2011, when about $14,000 less in property tax from the project – if all other variables stayed the same – would be figured into the town’s budget.

“They’re not requesting any money, any check. If we award them an abatement, they will give that money to the town for the year 2010, but they want to be appraised at $9,432,000 for the 2011 year and thereafter,” Selectwoman Carol Richardson said.

The selectmen also act as the assessors for the town’s approximately 630 residents.

“We didn’t want to put (the town) in a bind, so my main goal is to have the value adjusted going forward, to the correct value,” Presson said.

There is still a question of how much the property, with its 262-foot-tall steel towers, is worth.

That’s why selectmen voted Monday night for assessor Jackie Robbins to appraise the property and present them with a value in the coming weeks, Selectman Ron Price said. Price abstained from voting Monday because he leases his property to the developer.

Selectmen will then decide whether to grant the abatement request.

“All I want is to make sure everybody’s treated fairly,” Selectman Clint Spaulding said.

“These are not easy projects to value. There are millions of dollars involved,” said Mike Rogers, supervisor of municipal services at the property tax division of Maine Revenue Services.

Because there are just five currently-operating commercial wind farms in Maine, and they are all different, it’s impractical to judge value based on other sites, Rogers said. The best way to determine the value of a wind farm is to determine how much it cost to build.

That’s what Beaver Ridge Wind LLC did, Presson said. When the company added up how much everything cost – including installing the turbines, constructing the site, building roads, installing underground wires and financing the project – the total amounted to about $9.43 million.

While the town agreed to that number in 2009, selectmen increased the assessed value to $10.8 million in 2010.

When he got the notice of the $1.4 million increase, “It was a shock,” Presson said. Usually wind projects depreciate in value over time, he said.

Richardson said she used a formula, financial information provided by the developer and national property assessment guidelines to reach the $10.8 million amount.

“I took the middle price of what they said wind power was going for. I didn’t take the high price, and I didn’t take the low price; I took the middle price to be fair,” Richardson said.

“If it’s a mistake, then it’s an honest mistake. When you assess property you don’t assess property to what you paid for it; you use a formula. I worked very hard trying to come up with a formula for the wind power,” she said.

One of the main reasons Freedom residents voted for the construction of the wind project was because they believed it would lower their taxes, Richardson said.

By itself, the project added to the tax base, but other items – such as the municipal budget and school district budget – have increased, leaving residents with no net tax relief.

“The citizens of Freedom voted for the wind power to come in for lower taxes, and I’m afraid it’s going to upset them if now (the developers) want the valuation lowered more than what they sent out in all their mailings to how much (residents) would save,” she said.

In its first estimations, Beaver Ridge Wind put out high numbers, Presson said. The final costs were slightly less than first projected.

The company also paid to build the transmission lines, Presson said, but it does not own them – Central Maine Power does – so they should not be included as part of the assessed value.

Source:  By Erin Rhoda, Staff Writer, Morning Sentinel, www.onlinesentinel.com 19 January 2011

This article is the work of the source indicated. Any opinions expressed in it are not necessarily those of National Wind Watch.

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