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Proposed Pike County wind farm looking to expand enterprise zone to add competitive edge to project  

Credit:  By DEBORAH GERTZ HUSAR, Herald-Whig Staff Writer, www.whig.com 27 September 2011 ~~

PITTSFIELD, Ill. – The company developing a wind farm west of Pittsfield hopes to have turbines operating by late summer/early fall 2012.

Looking to gain an edge over competitors statewide, Affinity Wind has begun discussions with county officials to expand an existing enterprise zone to include the wind farm.

“Just driving around the state of Illinois, there’s a lot of turbines, a lot of projects under construction or at a similar stage as our project. From a competitive standpoint, any kind of assistance in what’s a tough market and a tough overall economy makes our project that much more attractive and likely should we get some enterprise zone treatment,” Affinity founder and CEO Trey Goede said.

Power price is key to the industry which had been growing by leaps and bounds until 2008, leveled off in 2009 and dipped in 2010 as the national economy struggled. Lower power prices, compared to 2008, and shifting economics in the industry make it more challenging to entice buyers, so “any kind of movement on the project economics dial helps us get more competitive with how much we can offer the power for,” Goede said.

Phase 1 of the wind farm project calls for producing 36 megawatts with 18 turbines located west of Pittsfield over 2,000 to 3,000 acres.

“We’re still working with one or two last landowners. It would spread the turbines out a bit if the last couple sign, but to their credit, we only started contacts with them in the last 30-60 days,” Goede said. “They’re taking their time reviewing it. We’re hoping for similar results as their neighbors who already signed.”

Talks with landowners could begin later this year or early 2012 on Phase 2 of the project, but adding 114 megawatts to bring the project to 150 megawatts is “at least two years out,” Goede said.

“We’ve been supported by multiple people in Pike County for quite some time,” he said. “I know they’re getting as excited as we are. We’re hoping for a good 2012.”

Talks with the county to expand the enterprise zone are in the initial stages, Goede said.

“It hasn’t gone far enough to have anything of substance to report, but we’re reviewing it as an alternative,” Goede said.

Newly-hired Pike County Economic Development Corp. executive director Christa Perkins is reviewing the enterprise zone expansion.

The possibility has the Pikeland school district, one of the taxing bodies impacted by the enterprise zone, looking at its options for capturing revenue from the wind farm project. The district is working with Peru attorney Walter Zukowski, who does consulting work with schools on enterprise zones and tax increment financing districts.

“When the state of Illinois initially adopted the enterprise zone statute, 25 or 30 years ago, it recognized that abatement of taxes might be a factor in encouraging business to locate in an area, and it tried to provide a means and an incentive through enhanced general state aid payments to minimize the impact on local school districts,” Zukowski said. “Now because the state is late in making payments and late in making full payments, it’s a different dynamic than originally intended and causing schools to look more closely at whether to offer economic incentives or not.”

Pikeland Superintendent Paula Hawley said the district has three options to consider in discussions on expanding the zone, spurred by an ethanol plant proposed in Griggsville and certified in 2007 to provide income and job creation tax credits to companies within its borders.

The district could do nothing, see the enterprise zone expand and lose potential revenue from the wind farm project. The district also could withdraw from the enterprise zone, tapping into some additional money but potentially hurting the wind farm project and other future development, which is “probably not a good option for them or us,” Hawley said.

Under the third option, district negotiates a financial agreement with the wind farm “so they don’t lose and we don’t lose,” she said. “That’s what we’ll probably explore with Walt.”

The third option might be the best fit for Affinity.

“Should there be some kind of enterprise zone extension to include our project we have in our plans that we will be making some kind of payment in lieu of taxes up front,” Goede said. “That’s fairly common in places where enterprise zone treatment is granted.”

Zukowski does consulting work with schools on enterprise zones and tax increment financing districts.

“Working out an agreement would, in many circumstances, be financially advantageous to the school, but it depends of course on the terms of the agreement,” Zukowski said. “Obviously every situation is different. It would be up to the board to decide if the proposed arrangement happens to be in its best interest.”

Source:  By DEBORAH GERTZ HUSAR, Herald-Whig Staff Writer, www.whig.com 27 September 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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