County researches how to tax, and benefit from, turbines

As the wind turbines in Union County are providing electricity to grid, Union County Board of Supervisors are reviewing how they can contribute to the tax revenues, known as a TIF district, tax increment financing. No action was taken.

The county has 36 wind turbines, mostly in the northwest portion, installed in 2020.

Supervisors met Monday with Jenna Sabroske, representing Ahlers and Cooney law firm that assists county governments with tax related issues. Sabroske said one plan for the turbines’ tax revenue for the county and an amount for other taxing entities, like school districts where the turbines are located, and for county projects specified only within the location of the turbines. The projects can include the county roads adjacent to the turbines.

Other counties with turbines, like Adair, have set an 80% amount for the tax revenue. The county receives 80% of the revenue and the remaining 20% is distributed among other taxing entities within the turbines’ locations. State guidelines have county’s tax 0% on the first year of the turbine’s operation. In the second year, the tax revenue is 5% of the net acquisition cost of the turbine. The amount increased 5% each year until year seven when the property would be capped at 30% of the net acquisition cost.

“Where ever that turbine sits,” said Union County Assessor Mindy Schaefer, “if it sits in Lincoln Township they are only paying Lincoln taxes. They are not paying Spaulding’s.”

Union County Assessor Mindy Schaefer said Union County’s turbines, at 100% tax revenue for the county is estimated at $23.3 million over 20 years. At 95%, it would be about $22.2 million over 20 years. Schaefer said if the county collects 100% of the revenue, none of the revenue would be for other taxing entities.

“Those other levying authorities are benefiting from the turbines going up,” she said. “If you don’t capture it all, then the county’s general fund will get some additional money. The county’s hospital will get additional money. You still want those other levying authorities to have some benefit of the turbines going up. It comes into how much tax revenue do you want to keep within the taxing entities and how much you want to capture for road projects,” she said.

Clarke County Engineer Christian Boehmer, who is assisting Union County, has a list of potential projects that can be funded with revenue from the taxes. Boehmer plans to have bond issues for funding, with those funds to be paid by turbine tax revenue.

Sabroske said she can assist the county with creating the area for the projects funded by wind turbine tax revenue. She suggested creating a list of potential projects with not-to-exceed costs for each project. Supervisors are expected to formally accept Ahlers and Cooney’s assistance next week.