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Illinois Senate passes wind farm tax legislation

Posted August 09, 2007 11:00 pm

Wind farm tax legislation unanimously passed by the Illinois Senate on Thursday would level turbine assessments in all 102 of the state's counties, potentially raising annual property tax bills for some farms while slashing them for others.

The legislation, which is designated House Bill 664, sailed through the Senate on a 53-0 vote and next moves to the House of Representatives. To become law, it must pass there and be signed by Gov. Rod Blagojevich.

Wind farms, a fledgling industry in Illinois, at present can be assessed differently in each county, with each local administration using differing methodologies to determine the value of turbines and energy generated.

But if the legislation becomes law, wind farms in 2007 would pay a tax of $9,000 per megawatt, no matter where in Illinois it is. That figure would drop slightly each year because of physical depreciation.

Woodford County Administrator Gregory Jackson said the approved rate is a favorable figure, more acceptable than the $6,500 per megawatt rate that wind energy developers supported earlier this spring.

"We thought that was too low," said Jackson, who supported an $8,000 to $8,500 per megawatt range at the time. "The $9,000 figure is exactly where it should be."

The rate also should yield more tax revenue for the county than the 20 percent of assessed valuation rate that had been proposed for the pending 79-turbine Navitas Energy project near Benson. Jackson said he asked the County Board to hold off on any wind farm-related decisions until the tax legislation is approved.

"I believe what the County Board wanted was to make sure the taxing system is equitable and, more importantly, the state statute is uniform and consistent across the state," Jackson said.

The legislation, too, could cement wind farm plans in Bureau County, where two proposed projects have reportedly been stalled because of the county's assessment of an already existing wind farm. Representatives of Midwest Wind Energy have said they were delaying construction on the Big Sky and Crescent Ridge II wind farms until the tax issue was resolved.

The company currently is appealing the county's 100 percent assessed valuation of its 33-turbine Crescent Ridge installation, which became operational in 2005. The 2006 tax bill - the first full year of operation - came out to be $36,721.22 per turbine. Under the new legislation, each 1.65 megawatt turbine would be taxed approximately $14,850 per year.

"The idea now is that we'll get a bit less for these," said Tom Sweeney, Bureau County supervisor of assessments. "Bureau County was entitled to 100 percent, but I'm glad to see this go through. … The problem with the variance (in rates between counties) did need to be addressed."

If enacted into law, the measure would expire, or "sunset," after the 2011 tax year. The expiration date is intended to let lawmakers see how well the law works and whether it might need revision in the future.

The proposal was negotiated after months of talks involving county assessors, local governments, wind-energy companies and lawmakers, including state Rep. Frank Mautino, D-Spring Valley, and state Sens. Dan Rutherford, R-Chenoa, and Mike Jacobs, D-East Moline.

Adriana Colindres in Springfield and Matt Buedel and John Sharp in Peoria contributed reporting for this story.

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