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State settles with Duke Energy on property taxes

CHEYENNE – Duke Energy will pay lower property taxes on its Wyoming wind farms, thanks to a settlement reached with the state Department of Revenue.

The agreement means Duke will pay about $230,000 less in property taxes than was originally assessed for 2009.

The most significant change involved Duke’s 200-megawatt Top of the World wind power operation in Converse County.

In its appeal, Duke, based in Charlotte, N.C., said it should not have been taxed for turbines associated with the project because they were not installed.

The company reported those turbines as “construction work in progress.” But they were not even in the U.S. at the time.

Duke indicated on its tax returns that the turbines were in place, said Ed Schmidt, director of the revenue department.

The agency simply set the assessed value based on what Duke reported, Schmidt added. He agreed the turbines could not be taxed if they weren’t installed.

They were to be built in 2010, meaning the company will pay property taxes on them this year.

The department also slightly reduced the assessed value of Duke’s 29-megawatt Happy Jack and 42-megawatt Silver Sage wind farms in Cheyenne.

That means Laramie County will get about $11,000 less in property tax revenue from Duke.

The company was originally taxed on an assessed value that included money the company sets aside to disassemble the wind farms once they reach the end of their use.

But that money shouldn’t be part of the company’s assessed value because it is not a physical asset, the revenue department said.

Laramie County still gets about $973,000 from the company annually.

The turbines have a lifespan of 20 to 30 years, said Duke spokesman Greg Efthimiou.

After the settlement, Duke will pay $2.54 million to cover last year’s tax bill instead of the $2.77 million originally assessed.

Efthimiou said the settlement is fair.

“We are very glad to arrive at the right figures with the state,” he added.

The revenue department and Duke Energy will continue their dialogue on wind tax property assessments this year, Efthimiou said.

Duke has two wind farms in Laramie County and two in Converse County. Its first Wyoming wind farm was constructed in 2008.

At this time, the company has no plans to build more in the state.

The settlement was approved by Gov. Dave Freudenthal in December but was not official until this month, Efthimiou said.

Schmidt said it is not unusual for companies to appeal property taxes.