The taxing problem of solar energy: Solar exemptions not to everyone’s taste
Seems that politicians at the local level in California are concerned that state tax breaks will preclude the county from getting its part of the energy projects tax pie.
3 new solar energy farms are currently pending in the eastern part of San Luis Obispo (SLO) County. California currently exempts solar energy systems from property taxes, but the exemption is set to expire at the end of the year. Assembly Bill AB 1451, recently passed by the legislature but not yet signed into law, would extend the exemptions for 7 more years. SLO County officials are concerned that the tax break will cost the county “millions” of dollars in lost property tax revenue from the new solar farms, and county officials are not too happy about that.
The first paragraph from the local article on the lost revenues says, “County officials are concerned that a bill passed by the state Legislature that extends property tax breaks for new solar power plants could cost the county millions of dollars in annual revenues.”
But if the bill doesn’t pass, the county still won’t get any new revenue because the solar firms won’t build the plants. And there’s not a lot you can use land for in eastern SLO county to generate money. “God-forsaken” is an often-used term.
And the exemption applies only to the cost of the facility; the land itself is not exempt, and building a solar farm there will increase the land’s value and thus its taxes. Plus, the new facility provides skilled jobs to the local labor force. (Although some locals aren’t too happy about the jobs either because they might not be union jobs. You can read the comments at the end of the article link.)
Local leaders won’t go so far as saying the politically-correct green solar farms shouldn’t have exemptions – they just don’t think they should be property tax exemptions. According to the article, county officials prefer incentives in the form of state income tax credits. This is the root of the tug-of-war: Much of local property tax goes into county tax coffers, while most of the state income tax goes to the state. The state legislature is passing the solar tax exemption, so they make it a tax that affects county taxes rather than the state. State politicos are happy, county guys not so much.
And here I thought getting a critical mass of solar electricity-generating plants was a technology problem. Nah, the problem is always people.
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