Wind energy is a promising technology to help reduce our reliance on foreign oil and natural gas. Minnesota doesn’t have much coal to contribute to domestic energy production, but we do have wind. We have a lot of wind.
Earlier this month, the Worthington Daily Globe featured a three part series above the fold on wind farms in Southwest Minnesota, and issues our counties, townships and school systems are having with tax restrictions on wind turbines.
When wind energy production systems first starting going up in the region, local government was only able to recoup the costs to provide services by collecting a property tax on the base and tower of a turbine, “a mere 10 percent of the value” according to David Benson, a Nobles County Commissioner (and officer of my employer, the Southwest Regional Development Commission).
“We, on the Rural Minnesota Energy Board, said that’s ridiculous — there’s not enough income to the local entities,” he added.
Eventually, RMEB backed a plan in which counties would collect property taxes on 30 percent of the assessed value of the entire tower — including the nacelle, which is the turbine’s generator. Benson said the nacelle is 90 percent of a turbine’s overall value.
Not long after the state changed the tax formula, one of the major wind energy companies took Lincoln County to tax court on the issue. Benson said the legal fight lasted for about 18 months and ended in a settlement. Still, the county was left with a legal bill of more than $100,000.
“We saw that as just not fair,” said Benson.
The next year, RMEB convinced the state that the Minnesota Department of Revenue needed to do the assessments on wind towers and defend that assessment in a court of law if necessary.
As time went on and towers depreciated in value — at least on paper — the Sustainable Energy for Economic Development (SEED) Coalition went to work to developing a tax that would be collected based on the amount of energy production from each turbine.
The wind energy production tax went into effect in 2003.
“This was something that was supposed to be in addition to what the normal state aid is,” said Benson.
It was extra money until it was taken away by the Minnesota Legislature in 2008.
I know alot of my conservative friends would applaud the tax-limiting effect of this change. Fortunately for them, they don’t have to live with the costs of this benefit to our nation’s energy infrastructure.
“The idea behind the production tax was to give the county and the townships extra income to pay for infrastructure,” said [Cottonwood County Auditor Jan] Johnson. “(The heavy loads) do some sever damage to the roads.”
You see, these towers don’t just magically appear on the prairie. They aren’t flown in on helicopters. They arrive piece by piece on big heavy trucks (up to 58 tons), only after 50 or so cement trucks fill big gaping holes to provide a solid foundation upon which a big heavy crane assembles the 500 foot tall monstrosities.
There is a short-term cost to wind farm construction. Heavy loads do tremendous damage to local roads, especially gravel township roads and especially during spring load restrictions. Then there are long-term concerns for roads and bridges in our rural counties, where the average life-cycle of a road might be cut in half by the extraordinary weight of the trucks moving turbine equipment. The third article in the series deals with this more directly:
Tim Stahl, Jackson County Highway Engineer, is among a group of engineers from across southern Minnesota that, for more than a year, has examined the issues associated with the large loads hauling wind turbine parts through the county, and the toll those heavy loads are taking on the road system.
“What we’re working on is to address the concerns we have as county engineers,” said Stahl. Together, the group is working on a Best Management Practices plan for wind farm development as it pertains to local land use and road authorities.
Once completed, the plan will quantify the damage large loads have on the roads and provide protocol that will explain the responsibility utility companies have to keep the roads maintained.
“These companies want to start (construction) before spring load restrictions are lifted,” said Stahl. “Just a few loads in the spring will destroy a road. I’ve heard 80 percent of damage to a road can occur in the six to eight weeks of spring load restrictions.”
There are other issues, too, like who should pay for bridge structure analyses on roads where the overweight vehicles travel, and what the developer’s responsibility is with regard to traffic flow.
The long loads require moving stop signs at rural intersections to provide enough room for the trucks to turn. Stahl questioned who pays for the costs of relocating stop signs and monitoring temporary, moveable stop signs during construction.
“By using this (Best Management Plan), we can show the legislature that these things don’t come without a fee,” he said.
“The revenue (from wind turbines) is wonderful, but it doesn’t come without a cost. The amount of damage we’ve seen on the two projects we had in Jackson County was that the road life is consumed by these projects,” he added. “We are trying to get a handle on this ahead of time — sharing information with these companies so better decisions are made.”
Another concern I have with wind development is simply the price rural communities are asked to pay, turning our agricultural landscape into industrial parks. The articles count 228 wind turbines in Murray County, where I live. Pipestone County to the west has 119. Jackson County has 114 and more going in. Cottonwood and Nobles counties have about 35 each and more planned if (when) project financing recovers.
My concern is the same concern many others have from the oil & natural gas rigs dotting West Texas and the Wyoming high plains to solar arrays disrupting California deserts. How fair is it when rural property owners and residents are asked to shoulder to cost of energy development, with nothing to show for the damage?
The first article related the impact of the 2008 legislative change. In essence, the wind energy production tax that used to be available for additional services stemming from wind development, is now counted against maximum levy limits. So no matter how many of these ugly towers that clutter up my neighborhood and destroy the natural beauty of this place, there is no additional revenue available for sheriff’s deputies, ambulance runs, or any of the thousand functions that keep our county functional.
I think Pipestone County administrator Sharon Hanson summed it up nicely at the end of the first article:
“We don’t really need the state telling us how to spend the money. I think locally we can make the right decisions. It’s better to do it that way and not have strings attached.”
I try not to whine about it too much. We just need to come to a fair solution so the costs of development don’t outweigh the benefits.
(EDIT: The first of the three stories on the Daily Globe website is are already in their electronic pay-to-read archives, so I don’t know if or how long the other links will stay live here is a 1.6MB PDF of the print versions.)
1. Counties deal with tax issues on turbines 11.11.09
2. Turbine tax named No. 1 priority 12Nov09
3. Turbines: Heavy loads damage roads 13Nov09
Note: All opinions on JCShepard.com are my own and may not reflect any policies or positions of my employer SRDC, any local government in the region, or any funders of programs and activities of the SRDC.