WATERTOWN – Jefferson County Industrial Development Agency Board Chairman David J. Converse said changes to its Uniform Tax Exemption Policy would not fly in the face of the county’s new tax abatement rule for large alternative-energy projects.
The JCIDA is aiming to include such energy projects under its revised tax abatement policy, which it is required to consider changing every five years.
Retail and alternative energy projects are not included under the IDA’s current policy, meaning the IDA must seek approval from taxing jurisdictions in order to grant a payment-in-lieu-of-taxes agreement to alternative energy projects. Mr. Converse said board members are looking to change the UTEP to allow alternative energy projects to be included.
However, he said, large-scale wind projects will more than likely deviate from the UTEP and require approval for a PILOT because of their size.
“I don’t foresee any wind project falling under a UTEP where there won’t be some kind of deviation,” Mr. Converse said, adding that a changed UTEP would apply more to smaller energy projects, such as hydro and biomass. “But most of the time, they won’t.”
Michelle D. Pfaff, JCIDA treasurer, said that because large wind projects are built on leased land, it would require a change in the UTEP formula, which is 50-percent tax abatement based on land value over 15 years. She added that changing the formula to include large-scale energy projects constructed on leased land would be too difficult.
In a recent Loan Review Committee meeting, IDA board members said they could pursue an extension of the allotted maximum duration for tax abatement from 15 years to 20 years without changing the standard exemption amount, in an effort to offer more flexibility for developers.
If a new uniform policy does not have language freeing wind and solar farms from these new regulations, a 20-year exemption would take those projects to the end of their life expectancies.
Jeremiah J. Maxon, a Jefferson County legislator who is an IDA board member, said that the proposed changes to the UTEP’s position on alternative energy only apply to hydroelectric, photovoltaic and biomass projects. Mr. Maxon noted that UTEP changes are still in the discussion phase.
Earlier in July, the Jefferson County Board of Legislators passed a policy requiring that alternative energy projects with an output greater than 25 megawatts pay the county an amount equal to full taxation regardless of whether a PILOT is in place.
The policy would affect projects such as Apex Clean Energy’s planned Galloo Island wind farm in the town of Hounsfield. Donald C. Alexander, JCIDA CEO, had initial concerns about the county’s policy and said the Legislature should consider each project individually instead of setting an all-encompassing rule. Mr. Alexander could not be reached for comment Friday.
Scott A. Gray, chairman of the Jefferson County Board of Legislators, said he’s concerned that changes to the IDA’s tax guidelines for alternative energy could be seen as a move against the county’s policy.
“It gives the appearance that they are running contrary to our desires,” Mr. Gray said. “I’d rather they recognized our desires that we put forward and that they try to work with us. I’m opposed to any revision to the UTEP that draws it further away from elected officials.”
Mr. Converse, however, said the change would not undermine the county’s wishes.
“We’re not looking to take away any authority from the elected officials,” Mr. Converse said.
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