First of two hearings highlights wind farm’s TIF terms with county
Credit: By Lora Whelan | The Quoddy Tides | January 24, 2020 | quoddytides.com ~~
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Over 60 Washington County residents gathered on the afternoon of January 9 for the first of two public hearings held by the county commissioners in the county courthouse in Machias to discuss the Washington County Downeast Wind Municipal Development and Tax Increment Financing (TIF) District. Commission Chair Chris Gardner explained that the commissioners have no jurisdiction over planning and zoning concerns related to the wind farm development, but the commission can ask for changes in or reject the TIF district in the county’s unorganized territories (UT). He added that the reason for the hearing was to ensure the maximum public benefit from the TIF terms of agreement. “The focus today is the financial aspect.”
Unorganized territories in the state and county, unlike municipalities, are overseen by the Land Use Planning Commission (LUPC), which serves as the planning and zoning authority for the unorganized and deorganized areas of the state, including townships and plantations. These areas either have no local government or have chosen not to administer land use controls at the local level. Unorganized territories usually have lower property taxes because of the lack of municipal governments and schools.
On hand to give an overview of the wind project was Paul Williamson, who manages Apex Clean Energy’s projects in Maine and New England. The Downeast Wind Farm is a subsidiary of Apex. A total of 30 wind turbines are planned, eight in Columbia and 22 in the Washington County UT. There are 40 locations determined as suitable spots, but the farm would only use 30 of them, and the company expects that a few will be winnowed out during the permitting process. “The sites were chosen for proximity to power line infrastructure,” Williamson said. He added that there will be no impact on designated historic sites, no use of eminent domain, and all the land is commercially managed for agriculture or forestry products. Along with LUPC, Downeast Wind is working with the Maine Department of Environment Protection (DEP) and the Department of Inland Fisheries and Wildlife (IFW).
The project is expected to be a $250 million investment by the company, with $28 million going to landowners for land use, $8.4 million for the construction payroll of several hundred jobs, $500,000 in annual direct salaries and $4.2 million in 50 “induced” jobs in greater Washington County. In addition, the mandated community benefit agreement required by the DEP is expected to result in a one‑time payment to $500,000, with $350,000 designated for property improvements around Schoodic Lake, where a number of the turbines will be near. Columbia is expected to receive $280,000 and the unorganized territories $7.5 million for the life of the 25‑year agreement.
Stephen Wagner of the law firm Rudman Winchell, which represents the county, explained the TIF in more detail. The TIF district would cover 14,000 acres. TIF revenue comes from the difference in original and developed assessed value of the project’s property. The property is taxed at the pre‑development assessment, thus avoiding reductions in state subsidies brought on by the increased valuation.
The TIF agreement is to hammer out how the TIF revenues are distributed between the developer and the county. If the county declines to have a TIF agreement with the developer, then TIF revenues are distributed to all the UT districts in the state, which is over half the state’s land mass, explained Gardner, thus highlighting the importance of having an agreement that maximizes the benefit to the county.
As proposed, the TIF agreement would split revenues 70/30, with the developer receiving the larger amount. Over the course of the 25 years, the developer is expected to receive $6.7 million and the county $3.7 million. The county is well versed in TIF agreements and use of TIF funds, with prior wind farm agreements in place. TIF funds have state restrictions on how they can be used, with priority given to economic development, improvement of the TIF district and for infrastructure projects by the developer, among other uses.
The public comment period, lasting for over an hour, appeared to be a lesson in frustration, with very few of those present commenting on the TIF but instead commenting on concerns that would fall under the jurisdiction of the DEP and LUPC. Gardner reiterated, “We’re keenly interested in concerns and comments regarding the TIF. That’s our purview.” He added, “We want to hear issues in the framework of the TIF and credit enhancement agreement.” His words fell on deaf ears. Jay Mills of Jonesport summed up the feelings in the court room when he said of Williamson’s presentation, “This guy brings up more red flags than Gardner’s Lake on fishing day.”
Many of those present expressed their frustration with the developer’s community notification process to project abutters and the public hearing notices, and they demonstrated confusion about the difference between municipal and UT zoning and about what TIFs are exactly. Many pointed to land use concerns such as the turbine siting and sound generation, issues that they were encouraged by Gardner to make known to the DEP and LUPC. Only a few commented on the commissioners’ task at hand – to make sure the TIF agreement benefits the county.
Charles Rudelitch, Sunrise County Economic Council’s executive director, asked the commission to “consider the possible impact of bankruptcy on the community enhancement agreement.” Apex’s Williamson responded that state law and DEP regulations require the developer to have a decommissioning plan and a bond posted. It is updated ever two years and reviewed by the state to make sure that the bond amount continues to be sufficient.
David Bell of Cherryfield Foods noted that the last few years have been “real tough” economically. He explained that the project will provide important revenue to the company when other revenues are low.
The county commissioners expect to hold a second public hearing on the wind farm TIF at 4 p.m. on Thursday, February 13, at the Machias courthouse building. All are welcome.
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