RAYMONDVILLE – There is a new deal on the table in Willacy County – the bigger the wind farm, the sweeter the tax break.
Yesterday, Willacy County commissioners offered property tax breaks ranging from 80 to 85 percent to EDF Energy, a London-based company planning to build 70 to 100 wind turbines along the county’s southeastern edge.
This latest wind farm is expected to reap a windfall in property tax revenue for the Lyford school district.
But the amount of property tax revenue will depend on the wind farm’s energy production.
If the wind farm produces 150 to 199 megawatts a year, the county will give EDF an 80-percent tax break, Melissa Miller, the project’s developer, said yesterday.
Miller said the county will offer the company an 85-percent tax break if the wind farm generates more than 200 megawatts a year.
However, also, as part of the agreement, EDF will pay the county $1,125 per megawatt per year during a 10-year period in lieu of the reduced property taxes, Miller said.
The company will pay the county about $168,750 a year if it produces 150 megawatts a year and about $225,000 if it generates 200 megawatts a year, calculations show.
Miller estimated the wind farm’s value is expected to range from $200 million to $300 million.
EDF is working with Raymondville developer Joe Wetegrove on the project.
The company is expected to determine the wind farm’s megawatt production by the end of the year, Miller said.
Miller said construction, which could begin toward the beginning of next year, is expected to be completed as early as the end of next year.
The deal is part of a new strategy aimed at drawing business into the county, County Judge Aurelio Guerra said.
Guerra said the county plans to offer 80-percent tax breaks to smaller wind farms and 85-percent tax breaks to bigger wind farms.
The county would consider tax breaks of as much as 90-percent for wind farms that lure other companies to the county, Guerra said.
EDF would become the third company to operate wind farms in Willacy County.
For eight years, wind farms have been changing much of this farming county’s landscape, pumping property tax dollars into rural school districts struggling due to low tax bases.
In 2009, E.ON Climate & Renewables launched the county’s first wind farm with 112 turbines across a 10-mile area east of I-69 and north of FM 186 between Raymondville and Port Mansfield.
In exchange, the county gave E.ON a 70-percent tax break but did not negotiate an agreement in which the company would make payments in lieu of property taxes.
A year later, Duke Energy built 151 wind turbines across a 20,000-acre swath east of Sebastian.
As part of an agreement, the county gave Duke an 85-percent tax break in exchange for annual payments in lieu of taxes of $260,000 during a 10-year-period.
In August 2015, E.ON presented plans to expand its second wind farm from 100 turbines to 115 turbines in an area north of FM 186 and east of I-69 near San Perlita.
To hold on to federal tax credits, the company must complete construction by the end of this year.
In 2014, the county’s previous administration entered into an agreement in which the county offered E.ON an 85-percent tax break on the $300 million project.
In exchange, the company agreed to pay the county about $200,000 a year in lieu of taxes during a 10-year period.
As part of the agreement, the wind farm will also pay the county $1,125 for every megawatt it generates per year for 10 years.
Officials said the wind farm originally planned to generate 200 megawatts per year, but its expansion will produce 230 megawatts.
Under the agreement, the expanded wind farm will pay the county about $258,000 a year during a 10-year period, calculations show.