BAD AXE – Efforts to create a moratorium on future wind districts until Michigan lawmakers resolve the uncertainty surrounding the personal property tax did not move forward on Tuesday.
A motion to pull a resolution creating the moratorium, however, died, during Tuesday’s Huron County Board of Commissioners meeting. That’s because the board could not get a majority to vote to kill the resolution. The final vote was a 3-to-3 tie.
The board did vote 4 to 3 to suspend discussion until the board’s next regular meeting, which will follow a 9 a.m. meeting of the whole Oct. 11 in Room 305 of the county building.
Another motion that resulted in a 3-to-3 tie vote during Tuesday’s meeting was one that would authorize the entire board to sign a letter to wind developers asking developers to commit in writing to paying the personal property tax or its equivalent for wind turbines. It also would ask developers to join a coalition of community leaders, wind developers and utilities to come up with a viable alternative to the personal property tax as a revenue source in the event it is eliminated.
Board of Commissioners Chairman Ron Wruble said he was responsible for the motion. He had hoped to garner the board’s support and have the letters sent out prior to a meeting county officials will have with representatives from the Michigan Association of Counties, Michigan Township Association and local units of government from other areas in the state that are seeing wind development.
He said the whole point was to get a written commitment from developers to take to that meeting. Also, Wruble said, it would give him some comfort, as a commissioner, if developers committed to playing on the same team as the county in the event the state “pulls the rug from out under us.”
“ … If we’re not going to stick up for the rights of our citizens, who’s going to? Is the state going to look after us?” he asked.
Wruble said he anticipated a 6 yes to 0 no vote on the motion approving the letter because the letter doesn’t really force developers to do anything.
“It’s just (a) ‘show your hand’ – either they’re on board or they’re not,” he said.
He questioned how much of a chance Huron County has getting heard in Lansing if the county doesn’t have developers and utilities working to keep the county whole in regard to the replacement that will be created when the personal property tax is eliminated.
Wruble asked whether the board will just sit back and watch what happens, without making an effort to maintain the tax revenue for the average person in this county.
Wruble: If there are no tax benefits, would you still favor wind developments?
Point blank, Wruble asked his fellow commissioners whether they would be in favor of wind development if there was no personal property tax.
Wruble said his answer was no, and the majority of his constituents feel the same way.
Commissioner John Bodis was on the fence, noting some of his constituents want everyone to benefit from wind developments and others feel landowners have the right to participate in wind developments.
Commissioner John Horny’s answer was yes. Commissioner Clark Elftman indicated if his constituents want wind developments even if there’s no taxes, then he’d support it.
Commissioner John Nugent said he supports wind developments, but they should be sited in locations that don’t affect residential property values, migratory birds and tourism. He said if there was no tax revenue, he would support wind development, so long as turbines are sited appropriately.
Commissioner Steve Vaughan said he has a wind farm in his district, and he’s has heard positive things about the revenue local units of government have received and how farmers are happy because they financially benefit from the wind farm.
He said he is for wind and the taxes will be great if they materialize. However, his constituents want to see development, so he will continue supporting it, whether the benefit is in an indirect form to the entire area or just a direct benefit to participating landowners.
With that said, Vaughan noted, Wruble’s question is a difficult thing to say “yes” or “no” to because he wants developments to continue and for the personal property tax to be left alone.
Resolution’s legality questioned
Vaughan wanted the board to throw the moratorium resolution away and create a different resolution that addresses some issues of concern – such as setback distances from the shoreline and non-participating property lines and noise requirements – through the process outlined in the Michigan Zoning Enabling Act.
Russ Lundberg, former director and now advisor to the Huron County Building/Planning and Zoning Department, urged commissioners to follow the process in that act. He said a moratorium isn’t appropriate because the county already has an ordinance in existence. Therefore the county should follow the lead of the Michigan Zoning Enabling Act and go through the ordinance amendment process in that act because that’s the law, Lundberg said.
The ultimate question some commissioners still felt has gone unanswered is whether the board can legally approve the proposed resolution. Bodis, in particular, was in favor of suspending discussion until that specific question is answered.
Others felt that because Commissioner David Peruski was absent from Tuesday’s meeting, the board should wait to take final action on the resolution until the entire board is present.
The motion to approve the letter that died because of the split vote is not expected to be on the agenda of the board’s next meeting. Wruble said even if Peruski was present and the vote to approve the letter passed 4 to 3, he still wouldn’t want to send it out since only a little more than half of the commissioners would be on board with it.
Developers say they’ve already made commitments
Three wind developers at Tuesday’s meeting stated they previously sent letters expressing a commitment to working with the board on this issue.
Brad Lila, of RES Americas, said his company was one of the developers that agreed to a sit-down – especially at the state level – to get this issue resolved, because RES is concerned too.
“I wish the personal property tax would stay in place,” he said.
David Shiflett, development assistant for Geronimo Wind Energy, said Geronimo uses proceeds from a wind development to benefit a foundation created for the local community.
As it currently stands, the personal property exists, and if that’s still the case once Geronimo’s project is created, the developer will put almost as much as 25 percent of the county’s budget into the local coffers in its first year, Shiflett said. Already, Geronimo has invested hundreds of thousands – even millions – of dollars into the local community, he added.
Shiflett took issue with county officials limiting a landowner’s ability to generate revenue from their own land because someone doesn’t want to look at wind turbines.
DTE Energy Regional Manager Ron Chriss felt the proposed letter is ambiguous. He noted DTE Energy already has made a commitment in writing to work with the county and help find a replacement.
Residents have their say
Port Austin resident Tony Loewe said the board not only has the authority, but the obligation, to take care of all the residents – not just a few. He said if the personal property tax is eliminated, the board is obligated to secure a revenue stream from these developments. And until the board knows where revenue from turbines will be coming from in the future, commissioners shouldn’t let new developments be built in Huron County, Loewe said.
Other proponents of the wind moratorium argued voters approved the creation of two new wind districts last fall on the assumption the whole area would benefit from personal property tax revenue.
Opponents to the moratorium argued this is not the appropriate time or place to fight a battle on tax issues. They felt imposing a moratorium on wind developments is a double standard for development in Huron County, and there shouldn’t be a double standard for wind energy.
Proponents expressed other concerns that weren’t so much related to the threat of losing the personal property tax, but were about other issues such as aerial crop dusting not being possible in wind developments, migratory birds being adversely affected and turbine noise requirements needing to be revised. Also, there were concerns about the price of wind energy and subsidies the industry receives.
To that end, opponents argued that subsidies for renewable energy are far less than all the subsidies received for oil and other fossil fuels. Chriss said for every study and report on various aspects of the industry, there’s always refuting evidence.
He said many people concerned about Gov. Rick Snyder’s call to eliminate the personal property have ignored the fact that Snyder wants the elimination to be revenue neutral. As a result, if the Legislature eliminates personal property tax, it will have to have a replacement for the $1.2 billion in revenue that’s generated by the personal property tax.
AP: Personal property tax high priority in Senate this fall
The Associated Press reported last week that Republicans who hold the majority in the Michigan Senate said changing the state’s personal property tax is a high priority this fall.
Crain’s Detroit Business reported Monday that one option state officials are looking at is replacing revenue to local governments and other entities with money that will be available from expiring business tax credits.
How that would make up the loss of personal property tax revenue from wind turbines is unclear.
This past spring, 31st District Sen. Mike Green (R-Mayville) introduced a bill changing the classification of wind turbines from personal property to real property. In the event that legislation is passed, the area still would realize tax benefits from wind developments if the personal property tax is eliminated. However, it’s unclear how feasible this option is, and the bill remains in the Senate Committee on Finance, where it’s sat since it was referred there May 26.
On Sept. 14, 84th District State Rep. Kurt E. Damrow (R-Port Austin) presented a plan to tax wind turbines to the Legislative Service Bureau as a request for legislation. He told the Tribune on Sept. 16 that there’s a good chance it will be introduced in the House by the end of the month. A bill search on the Legislature’s website, www.legislature.mi.gov, found no results that Damrow’s plan, the Alternative Commercial Energy Tax (ACET), has been introduced at this time.
Damrow said the ACET, which would cover solar, biomass and wind facilities, is based on the first year of personal property tax and power production. Revenue generated from the tax would be distributed as follows: 50 percent to the county’s general fund, 30 percent to the host township and 20 percent to school districts.
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