Another Red Flag: Solar Tax Treaty
- Mike Clifford
- Sep 27, 2019
- 3 min read
Updated: Jan 4, 2020
If you haven’t already read the Valley Breeze article about the upcoming solar tax treaty, you might want to read the article before reading this post. Here’s a link to the article: https://bit.ly/2nuGjFQ
Another red flag has appeared regarding the Green Development solar project. The developer wants to put only $192,000 in a town controlled escrow account to cover eventual decommissioning (removal and clean up) costs of the proposed solar array; close to a million dollars less than what should be required for Green Development’s proposed 38.4 megawatt array. In addition, there will 9 separate agreements with 9 different LLCs (limited liability companies) instead of just one agreement with Green Development.
Many professionals in the field believe at least $1.15 million would be needed to decommission a solar array of this size at the end of its useful life cycle. Recently published articles suggest decommissioning costs of solar arrays are being grossly under-estimated and eventually many communities will be facing painful financial burdens as a result.
The attorney for the developer contends requiring $1.15 million be placed in escrow to protect the town would be “punitive”. Funny, the developer squawks at having to put $1.15 million aside to protect the town, but had no problem agreeing to $31 million in lease payments to the land owners. If the town council allows Green Development to post a bond instead of placing at least $1.15 million in cash into a town controlled escrow account, rest assured the town will likely find itself holding the bag for a colossal clean-up tab when the facility becomes obsolete.
Some council members promoted this project by touting the proposed annual revenue to the town of $402,000 a year and a one-time payment of $287, 500. Those numbers have already shrunk! The annual revenue is now projected to be $268,800 rather than the promised $402,000 and the one-time payment is now projected to be $192,000. In the past I’ve said those numbers were questionable and I still believe the net revenue the town will realize will be much less than what is currently being offered. The original numbers were used as bait to garner support for the project and unfortunately the majority of our town leaders took the bait - hook, line and sinker.
Monday night’s town council meeting was intended to be a public hearing on the proposed tax treaty and development agreements. Draft agreements which basically represented the terms acceptable to the developer were discussed. At the conclusion of the public hearing the Town Council voted to establish a smaller group to meet and iron out the details of final agreements. The attorney for the developer was quick to seek assurances that public comments at the next meeting would not be allowed. Council President Vadenais immediately confirmed the public hearing had concluded and public comments would no longer be accepted.
In the spirit of true compliance with our town ordinance which requires public hearings on agreements of this nature, I expected the public hearing to be continued until the final agreement was presented and residents allowed the opportunity to address the terms of the actual agreements before the council votes on them. Commenting on a draft proposal does not equate with the public being afforded the opportunity to scrutinize and comment on the actual plan the council will vote on.
Under the circumstances, it behooves those council members who actually believe in practicing transparency (rather than just talking about it during election season) to insist that the final documents be publicized in advance of the next meeting and public comments be allowed prior to any vote on the final agreements. Talk of open government and transparency is cheap; actions speak louder than words. We’ll soon see which council members are truly advocates of open government. A motion to open public discussion on this item should be made by a council member when this topic appears on the next agenda. It will be interesting to see if any member makes that motion, and which council members vote in favor, if the motion is made.
I have strong opinions and many concerns regarding former Town Council President Beauregard’s involvement and actions regarding Green Development’s project which came to light during Monday night’s meeting. I’ll be addressing those concerns in a future post.
*** Readers who didn’t follow the approval process of this solar development last year might want to read the posts from last year on the topic which can be found on this page.
Link to tax treaty and development agreements posted on the town website: https://www.nsmithfieldri.org/home/news/green-development-draft-tax-treaty
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