Developers of the proposed Cold Spring Solar Project in a portion of southern Montgomery County remain optimistic about the project’s future despite failing to get a local tax break.
Jarrod Pitts, project development director at Tenaska, was in attendance at the June 14 meeting of the Montgomery County Council and drew heavy criticism from council members regarding Arevon and Tenaska’s request to declare portions of Brown Township as an Economic Revitalization Area. The declaration, which is the first step in receiving tax abatement, failed to get the council’s support.
County officials voiced their concerns over the potential loss of farm ground (an estimated 1,600 acres) and associated jobs and how large-scale projects negatively impact the ecosystem and property values of non-participating land owners. They also debated the overall merits of renewable energy and were critical of the amount of federal incentives utility companies receive.
“Arevon and Tenaska remain optimistic about the Cold Spring Solar Project,” Pitts said in a written statement days after the meeting. “We are partnering with local landowners to build a safe, quiet solar project that will generate enough clean electricity to power 30,000 Indiana homes.”
The proposed Cold Spring Solar Farm is described as 200-megawatt solar farm on privately owned land across Montgomery and Putnam counties.
“We are excited to have a group of landowners in the Russellville area (in both Montgomery and Putnam counties) who want to diversify their income by leasing their land for solar,” Pitts said. “We know that agriculture will always be the county’s most important industry. The land we have leased accounts for just 0.3% of the 469,000 acres of agricultural land in Montgomery and Putnam counties. Using this small fraction of land for solar production would generate approximately $10 million in additional local tax revenue over the life of the project, even with a tax abatement.”
David Harbison, a landowner in Montgomery County who is participating in the project, said, “Landowners like me have made the decision that leasing land for a solar farm is a benefit for us and the community. I look forward to hosting part of the project on my land.
“Agriculture is always going to be the main industry for our county, but landowners have the right to make decisions about how to use our land and some of us want to diversify by working with a solar project. Installing solar panels on a tiny fraction of our farmland will create new jobs, more tax revenue and homegrown electricity in a time where the need for alternative energy is quickly becoming a necessity. I think the Cold Spring Solar project would benefit the county and I encourage our local officials to further research and support it.”
Pitts added that because the proposed project’s location straddles Montgomery and Putnam counties, developers have some flexibility in where to place panels within the project footprint.
“There is the potential to shift more infrastructure — and more of the tax revenue and other economic benefits — to Putnam County, if necessary,” he said.
Pitts said developers were disappointed in the county council’s reaction to its initial discussions about a tax abatement, particularly given the county’s development-friendly solar ordinance.
“A tax abatement is an important factor in the economics of an infrastructure project like this,” Pitts said. “We operate in a competitive market where other electricity-generating projects are receiving tax abatements from their respective counties. In our experience elsewhere in Indiana, local leaders see the positive economic impact (jobs, increased GDP, property tax, lease payments to property owners, etc.) of projects like this and are willing to grant tax abatements. Additionally, as part of the tax abatement, the project would be willing to consider making economic development payments to the county that can be used for improvement projects in the community, such as road and bridge infrastructure, assistance to schools, building improvements, public safety and broadband, among others.”
A tax abatement does not mean a project won’t be paying taxes, Pitts added. The real property, which is not subject to an abatement, would have an approximate 10 times increase in its assessed value from solar.
“Therefore, from day one, Montgomery County would receive significantly more property taxes than are currently paid for these acres,” Pitts said. “Even with a tax abatement, we anticipate the project will pay approximately $40 million in local taxes over its operational life.”
Using land for solar is similar to landowners putting farmland into the CRP program and comes with similar benefits to the land. For example, the land has time to rest and rejuvenate, there is reduced use of fertilizer and pesticide, and soil erosion and run-off are controlled — all factors that can improve soil quality.
Pitts said the company will remove all solar panels and related infrastructure at end of the project’s life. The land, rested and restored, can then be used for agriculture or another use.
“We look forward to continued discussions with local leaders about solar technology, the Cold Spring solar project and the benefits it could bring to the area,” Pitts said.
The proposed project would not begin construction before 2024, pending appropriate approvals.
More information is available at www.coldspringsolar.com.