Wind energy company meets with county to begin negotiations for road, tax agreement
By Deb Hadachek Belleville Telescope editor
It might be years before a wind farm is built in Republic County–if ever. But Republic County Commissioners have just six weeks to decide whether to negotiate a payment in lieu of taxes with NextEra
But Republic County Commissioners have just six weeks to decide whether to negotiate a payment in lieu of taxes with NextEra Energy, or take their chances with a new state law that goes into effect January 1 that lets the state regulate how wind farms are taxed.
“We want to grease the slide a little bit about getting a wind farm going in Republic County sooner rather than later,” Republic County Commission chairman Ed Splichal told NextEra officials Monday morning. “This is economic development for our county and we want to be as helpful as can, but need to be prudent in what this agreement says. Looking out five years from now we don’t want citizens saying “you should have thought of this.”
Currently in Kansas wind energy projects receive a lifetime property tax abatement, but that changes January 1.
Sam Massey, head of NextEra development in Kansas, told commissioners the company has negotiated annual PILOT (payment in lieu of tax) agreements with counties based on the megawatt size of the farm for the life of the farm, which in general is about 30 years. A farm in Republic County could contain 200 or “significantly more” two or three megawatt towers, he said. He suggested a figure of $1,000 per megawatt as a PILOT for Republic County.
Republic County Appraiser Barry Porter said he and other county appraisers have tried to pin down the tax value of a wind farm as a state-assessed utility, which will be what happens in Kansas beginning January 1. Under the new legislation, wind farms will receive a 10-year property tax abatement, and then be assessed like other utilities beginning the 11th year.
“State assessed is kind of a foggy thing,” Porter told commissioners. “There are a lot of problems with that right off. It’s so gray I would not take a guess.”
Massey said that projects that take advantage of the lifetime tax abatement are more competitive, but the advantage for the company of the PILOTs versus state-assessed taxes after 10 years are “not enormous.”
“If we could get an agreement before the end of the year, we think it would be a win-win opportunity,” Massey told commissioners.
A public hearing on the conditional use permit that would allow NextEra to take advantage of the lifetime abatement will be held Monday, December 5 in the Republic County Courtroom. A legal notice of the hearing appears on 11A of this issue.
3-10 year process
Massey said the process to develop a wind farm takes three to 10 years.
“We just started here this year,” he said. NextEra has erected several meteorological towers in the area, and will gather wind data from them for 12 months.
The company has not identified specific locations for towers, he said. In general, the company is talking to landowners “between Belleville and Marysville, up to the Nebraska border and down about 2/3 way”, he said.
Depending on the result of land acquisition and the wind data collection, “We would aim for construction in 2019 or 2020, ” Massey said. “We would be extremely lucky to start in 2018, but don’t hold your breath.”
Two wind farm leases from the Munden area have been filed at the Republic County Register of Deeds office in recent weeks.
William “Rip” Leisure, a 15-year veteran for NextEra of wind farm construction, talked at length about how NextEra will upgrade roads and bridges during the construction phase.
In particular, bridges need to be able to support the weight of turbines as they are shipped to the sites.
“We have a substantial investment in the towers we are bringing in, and we don’t want to bring them across bridges that are not substantial,” he said. Once the sites for turbines are pinpointed, he works closely with county road and bridge departments to identify the routes. He said NextEra tries not to move turbines on county asphalt roads because of the high expense to upgrade those routes.
Leisure said the company also works closely with landowners to make sure the towers are positioned to not hinder their farming practices.
“We have found over years if we involve landowners, the county, the government agencies- -that partnering has been to everyone’s advantage and the information flowing back and forth is very helpful,” he said.
“We want to be good neighbors, and want to be part of this community.”
Leisure is currently supervising projects in Pratt and Kingman counties. NextEra has six projects in Kansas, and owns and operates 110 wind farms in 26 states.
“We have a lot of experience, and those projects are in counties that are largely agricultural,” Massey said.
Once construction is finished, NextEra turns the roads back to the county. Little heavy equipment is required to maintain turbines once they are built, Massey said.
Massey estimated that 200 to 300 workers are on site during wind farm construction. Many live in recreational vehicles, Leisure said.
“If they hear about us coming in, a good entrepreneur will start putting in RV parks,” Leisure said.
Once it is built, the company will employ about 12 people to maintain the turbines, Massey said.
“The reaction I’ve heard from citizens has been overwhelmingly positive,” Splichal told the NextEra officials. “I haven’t heard any negatives. Any questions I hear are from landowners trying to decide whether they want a wind tower on their farm or not.”
Commissioners said they have not discussed how a payment in lieu of taxes might be used.
“There are enough unknowns going into this project that we don’t want to tie the hands of future commissioners,” Splichal said.