September 16, 2018
Editorials, New York

Poor assessment: Wind companies don’t believe turbines count as real property

Watertown Daily Times | Sunday, September 16, 2018 |

After a dozen years of holding a 15-year payment-in-lieu-of-taxes agreement with Lewis County, Maple Ridge Wind Farm, operating under the corporate name Flat Rock Co., is filing a tax certiorari lawsuit – an action that challenges assessed valuations – against Lewis County and the towns and school districts that host the facility.

Avangrid Renewables and EDP Renewables jointly own Maple Ridge. Avangrid is a subsidiary of Iberdrola S.A., “an energy pioneer with the largest renewable asset base of any company in the world, with more than 14,000 megawatts (MW) of renewable energy spread across a dozen countries,” according to the Avangrid website.

EDP Renewables presents itself as the fourth-largest producer of wind power in the world, in 13 national markets in Europe, South America and North America.

Thus, neither company operates on a shoestring, and both have sufficient assets to bring to bear against tiny Lewis County and its even tinier municipalities.

EDP owns all or part of four Central and Northern New York wind facilities: Jericho Rise and Marble River in Curubusco, Madison in the town of Madison and Maple Ridge. Three years ago, when Madison was about to go off a PILOT agreement, EDP officials told Madison County and town officials it simply couldn’t afford to pay more in taxes than it was paying through its PILOT – $60,000 a year.

Yet in addition to the local tax break, the project was receiving a production tax credit that paid it for every watt of electricity produced, and the company sold the electricity produced on the state market. Its cries of poverty rang hollow then, and they ring hollow but louder now.

In Lewis County, the tax lawsuit filed there goes beyond a standard tax certiorari action. Typically, a property owner disputing the parcel’s assessment uses comparable parcels that are assessed at less (sometimes in the same taxing district, sometimes elsewhere) to show the disputed assessment should be lowered.

The Avangrid/EDP lawsuit goes much further. It is challenging the right to assess its turbines because, it claims, what is being assessed are removable machinery and personal, not real, property.

A wind industry official not involved in this action suggested that since the towers are bolted to a concrete foundation, they are thus mobile and not assessable. This doesn’t square, however, with the state’s ability to assess and tax mobile and modular homes.

Likewise, the state can assess and tax solar panels that are installed on a structure or affixed to a ground station. It also can assess satellite dishes as real, not personal, property.

Still, this claim will go before a judge to determine the merits of the argument. A ruling in favor of the plaintiff would be a devastating blow to every municipality that hosts commercial wind facilities. And it would drastically reduce the already scant economic benefits that these projects yield once the construction phase is complete.

Jefferson County is sufficiently concerned about the ramifications of the complaint that it will file a friend-of-the-court brief in opposition to the suit. Scott A. Gray, chairman of the county legislature, said the county will urge that Oswego, Orleans and Yates counties, all with proposed major wind projects under review, join its amicus curiae brief.

Officials outside of Lewis County are fearful that Lewis County, home to the largest wind facility in the Northeast, will address the suit based on the numbers, not on the underlying assessment threat.

County Manager Ryan Piche told the Watertown Daily Times last week, “It comes down to our appraisal versus their appraisal, our experts versus their experts. … At the end of the day, the judge is probably going to go right down the middle.”

This case, however, is not about numbers. It’s about a fundamental challenge to the right to assess and tax wind towers and all that is upon them.

Avangrid officials are making statements that diminish the significance of the legal action.

Paul Copleman, a spokesman for Avangrid, Flat Rock Windpower’s parent company, said in an emailed statement, “We have filed in order to preserve our legal rights while (PILOT) discussions continue, but this action is a placeholder formality while we attempt to help the tax jurisdictions ease the revenue downturn from the expiring PILOT.”

However, lawsuits are seldom “formalities.” The filing of this action is just as serious as any other legal challenge.

Jefferson County’s prudent decision to file to become a party to the lawsuit will help protect its assessment and taxation rights in the future. We hope other counties join in.

But most sincerely, we caution Lewis County officials not to be lulled by Avangrid’s “placeholder” statement. A forceful and effective response to this lawsuit will protect not only Lewis County but all of upstate far into the future.

[rest of article available at source]

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