A wind power firm that hopes to erect 30 large, commercial-scale turbines in western Washington County is looking to establish a tax arrangement with the county and the town of Columbia that would provide a 70 percent break on new property taxes it would owe.
The county and the town each are considering financial agreements with Downeast Wind that would result from the establishment of the tax-increment financing districts. The county’s TIF district would consist of 13,000 acres in townships 18 and 24, while Columbia’s district would consist of 463 acres northeast of Schoodic Road.
If the county’s TIF proposal is approved, the county would agree to return 70 percent of the property tax revenue generated by 23 of the turbines, which would be in the county’s Unorganized Territory, to Downeast Wind, and would keep the remaining 30 percent. Over a 25-year period, the total anticipated tax revenue from the project would be nearly $11 million, with $7 million going back to Downeast Wind and nearly $4 million going to the county.
The town and Downeast Wind also would agree to a 70-30 split for tax revenues generated in a separate TIF district in Columbia, where seven turbines are planned. If approved, the $7.8 million generated in tax payments from those turbines would be divided so that over 29 years, the company would have $4.5 million returned to it and the town would keep $3.3 million.
The county is expected to have a public hearing on its proposed agreements at 4 p.m. Monday, Feb. 24, at the county courthouse in Machias. The town plans a public hearing on its proposed agreements at 6 p.m. Thursday, Feb. 20, at the Columbia town office. A special town meeting to vote on the proposal will be held at the Columbia town office at 7 p.m., immediately following the public hearing.
Chris Gardner, chairman of the Washington County Commission, said that Downeast Wind will need approvals from the state Department of Environmental Protection and Land Use Planning Commission before it can develop the project. The county commissioners’ only role is to decide whether to accept the proposed TIF agreement for the Unorganized Territory in the county.
Gardner said he supports the proposed TIF agreement, which would commit $300,000 in tax revenue generated by the project to economic development in the county’s unorganized territory.
“It’s all about economic development and job creation,” Gardner said. “The TIF agreement on its face seems to be both reasonable and appropriate.”
Gardner said that when the commission votes on the proposed TIF agreement likely will depend on what issues are aired during Thursday’s public hearing. The county already held one public hearing in January, he said, and commissioners could decide to hold a third one.
The purpose of the agreements, which would require Downeast Wind to commit its share toward development of the project, is to mitigate the company’s costs of securing permits and developing the sites. The agreements would also protect the county and the town from the consequences of increased property valuations from the development, which could result in decreased revenue sharing from the state. Downeast Wind estimates it will invest $215 million overall in getting permits and then acquiring and erecting the 30 turbines.
For their parts, the county and the town also will be limited in what they can do with the tax revenue they keep. Both would be restricted to spending their share of TIF funds on capital and infrastructure projects, administrative and public safety expenses, and other costs directly arising from their respective TIF districts.
These payments do not include money that the company would provide the county and the town in separate community benefit agreements.
A proposed community benefit agreement with Washington County calls for 20 annual payments of $3,400 per megawatt of the generating capacity installed in the county’s Unorganized Territory. With 23 turbines with a generating capacity of 4.2 megawatts each in townships 18 and 24, that could produce annual community benefit payments of $328,000 to the county.
The firm’s first community benefit payment to the county also would include a one-time $150,000 payment to go toward development of a new high school vocational training center at the former Columbia Supermarket on Addison Road, and a one-time payment of $350,000 to be used for lakeshore improvements on Schoodic Lake, which lies in Columbia, Cherryfield and Township 18.
Aside from those one-time community benefit payments, the county would be obligated to use the annual payments for purposes such as “economic and workforce development projects, land and natural resource conservation, and other infrastructure and capital investment programs,” according to the county community benefits proposal.
A separate community benefit agreement proposed for the town of Columbia would provide the town with 20 annual payments of $181,000 in additional funds to go toward scholarships, local improvements and infrastructure, or property tax relief. This agreement also would include one-time payments to the town of $250,000 for salt shed infrastructure and $30,000 as a grant to the Pleasant River Ambulance Service.