Chowan, Currituck seek repeal of tax break for solar farms

By on October 4, 2017

Solar farms pay property taxes on a fraction of value. (Ecoplexus Inc.)

Chowan and Currituck counties are collaborating on an appeal against property tax breaks for solar energy producers and have asked North Carolina’s other 98 counties to join them.

The two counties have each sent a resolution to the North Carolina General Assembly, asking that the law that grants big tax breaks to solar energy producers be repealed.

That law allows the exclusion of 80 percent of the appraised value of solar energy electric systems from local ad valorem tax valuation, meaning that solar farms only pay property taxes on 20 percent of the property’s value.

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It’s an issue that’s been discussed among county managers of all of the counties in northeastern North Carolina, said Chowan County Manager Kevin Howard.

“We’re the only ones that don’t have solar farms,” Howard said. Two solar energy facilities have been approved, he added, but construction hasn’t started on either.

“It’s a revenue source we’re looking at,” Howard added. “For us, when we need money for schools and other projects, it make sense.”

In Currituck County, the law translates into a loss of $355,000 in tax revenue each year, Currituck County Manager Dan Scanlon said.

“The state repealed the state incentive, but left the county one in place,” Scanlon added. A state law that allowed a 35 percent tax credit on renewable energy systems ended Jan. 1, 2016.

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Currituck’s chairman of the Board of Commissioners, Bobby Hanig, said commissioners want the law allowing the tax break at the county level to be repealed as well.

“We want that to be changed to where we don’t have to give them that tax break,” Hanig said. “If it’s good enough at the state level, it should be good enough at the county level.”

As a business owner, Hanig doesn’t see the law as fair.

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“I don’t get a tax break, so why should a solar farm get a tax break?” he said. “We don’t get any benefits, so why are we giving them a tax break?”

Hanig added that Currituck commissioners aren’t against solar energy but would like to see solar electric systems be more of a benefit to the county.

The resolutions approved by Chowan and Currituck counties are similar, but there are some differences. For example, Currituck’s resolution spells out the loss of revenue to the county.

“We don’t have any construction, so we couldn’t include how much value they had,” Howard explained.

In 2015, renewable energy development in Currituck County comprised of solar energy electric systems encumbered 2,200 acres of land, with real property investment in the amount of $210 million, Currituck’s resolution states.

Because of the tax break, the solar energy systems in Currituck were assessed a combined business and property tax of $210,600, rather than the $1,008,000 any other commercial development would owe taxes on.

As part of the argument against the tax break, Chowan’s resolution includes information from a September report from the Solar Energy Industries Association.

That report states that the cost of installing solar energy production facilities has decreased 70 percent since 2010, and in North Carolina, costs have fallen by 64 percent over the past five years, according to Chowan County’s resolution.

There’s another difference in Chowan County’s resolution. It directs the clerk to the board, Susanne Stallings, to forward the resolution to the rest of the counties in the state, encouraging them to submit their own resolutions.

Both counties’ resolutions state that a community hosting a solar energy system should receive the full benefit of the developments, “particularly since solar energy electric systems reduce open space and useable farmland and generate visual and other impacts unwelcome to property owners adjacent to solar energy electric systems.”

In Currituck, a solar farm in Shawboro has been completed, and the first phase of another, much larger solar farm in Moyock has also begun producing solar energy, with plans for its expansion already approved.

Currituck commissioners denied a permit request for a third solar farm in Grandy, and has a moratorium in place prohibiting new solar farms until the county has revised its ordinances.

“Before we allow another one, we’re going to be sure we dot our ‘i’s’ and cross our ‘t’s’ and get it right,” Hanig said.

Currituck commissioners approved its resolution Sept. 18, while Chowan County adopted its resolution Monday night.

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Comments

Browny Douglas

October 10, 2017 9:46 pm

Can anyone explain to me why NC has , in place, solar to equal that of 46 other states combined? I believe “something smells good in Stinkville”, i bet it’s green.

Browny Douglas

Dee Langston

October 8, 2017 7:13 am

Chris, I’m fairly certain that the energy generated from Currituck’s solar farms isn’t sold locally. I do know that the solar farms won’t reduce the cost of utilities for the county’s residents.

elizabeth akjam

October 6, 2017 6:35 pm

good grief…they are using tired low taxation farmland back in the boonies…yes, the business needs to pay its fair share of taxes, but the land simply is not very valuable where they propose the farms. Clean energy…no pollution…water around you everywhere…don’t you want clean energy? Don’t you want to protect your tourism fueled environment?

larry sellers

October 5, 2017 11:24 pm

Even if your energy subsidy numbers are correct they don’t include the cost our military has paid in blood and money.
Can that cost, war and lives lost be counted?

How many military actions and how much funding has been spent on the Middle East, Iraq and worldwide protecting oil.
Bet the “subsidy” is way higher when you add in that cost.

Lance Manly

October 5, 2017 2:10 pm

>”2,200 acres of land, with real property investment in the amount of $210 million”

Currituck county land at 100k per acre?

surf123

October 5, 2017 1:12 pm

A little more follow up for @Big Picture who is completely uniformed. Cruise over to Wikipedia and look up Energy Subsidies (https://en.wikipedia.org/wiki/Energy_subsidies):

Renewable energy: $7.3 billion (45 percent)
Energy efficiency: $4.8 billion (29 percent)
Fossil fuels: $3.2 billion (20 percent)
Nuclear energy: $1.1 billion (7 percent)

Fossil fuels are in a distant 3rd.

surf123

October 5, 2017 1:09 pm

@Big Picture…You are talking about two different things. The supposed subsidies you speak of allow gas to be reasonably priced at around $3/gallon. Without them we could be looking at $10/ gallon like they pay in Europe. When guess went over $4 a few years ago there was an uproar. Fossil fuels (Oil and Natural Gas) are here to stay as there is no cheaper way to do it unless you believe the siren’s call of the solar industry which is heavily subsidized, much like the farmers who grow corn to make ethanol. Take away the subsidies and solar and ethanol go away. Government meddling is what allows events like this to happen.

As for this issue the solar farms are being subsidized (lower property taxes) at the county level (forced on them by the state), which means they are paying less than ever other business in the county as they are not getting a free gift. The idea of redistributing someone else’s money is socialism which we already have enough of. Leaving the government to pick winners and losers always leaves the taxpayers holding the bag.

surf123

October 4, 2017 10:00 am

Tax abatements (or reductions) along with other incentives to encourage specific industries or specifically companies to relocate to an area are completely unfair to existing businesses who do not get the same breaks. Incentives to individual companies for the purpose of relocation to a specific area are bribery.

Chris

October 4, 2017 9:46 am

I’ve heard that the power from the wind farm in Elizabeth City is actually sold up north to places like New York. I’m just curious if the energy being generated at these farms goes back to the local grid, or is also sold elsewhere?

Big Picture

October 4, 2017 8:41 am

Thinking about 20+ billion in taxpayer subsidies to fossil fuel industry and related health risks, the solar subsidy is a drop in the bucket.
Forward thinking should support and expand clean and renewable energy.

It is not clear in article if commissioners know how the electric grid works when they say more benefit to the county.

They could redistribute those tax dollars to homeowners who wish to install individual units.

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