PUTNAM COUNTY — As many in the area are aware, Avangrid Renewables has been negotiating lease agreements with landowners in Miller City for a 150 megawatt solar farm situated on approximately 1200 acres of land. Now, it seems, the company wishes to negotiate with the county on exactly how much it may need to pay in taxes once the utility-scale facility is operational.

From the perspective of the county’s three commissioners, the question should be a moot point. In 2010, the State of Ohio passed legislation allowing counties to enact Alternative Energy Zones, and Putnam County soon did so. This law streamlined the development of alternative energy such as solar power by, in part, standardizing the amount such developments would pay in local taxes.

Should the Miller City project be developed under AEZ rules, $7,000 per megawatt would be split between the county, township, and the school at the same percentage as property taxes are split now. This would bring-in an estimated $1,050,000 annually in taxes, with the largest split of approximately $640,480 going to Miller City-New Cleveland Local Schools.

Plus, the AEZ allows the option of an additional $2,000 per megawatt that would go directly to the county’s general fund. When establishing its zone, Putnam County chose to include this additional $2,000 per megawatt. It is this discretionary per megawatt tax that Avangrid seeks to renegotiate.

“I think their original offer was a low-ball offer and I am disconcerted,” said Commissioner Michael Lammers during a commissioners discussion held last Thursday, May 30. “They had to be aware of this resolution that was passed in 2010…The question I want to ask them is, where did they get the idea, certainly not from this office, that it’s a negotiable thing when it’s written in stone from eight years ago?”

“When they started this project,” offered Commissioner Vince Schroeder, “They didn’t inform the commissioners. They kept it under the covers. And, they were aware of the tax financing through the AEZ. That was up to the commissioners to join back in 2011, and we did. We made the tax $9,000 per megawatt. They knew all of this.”

At 1200 megawatts, the discretionary $2,000 per megawatt tax would deliver $300,000 annually directly to the county’s general fund. Though the proposal by Avangrid remains unknown, the commissioners indicated that the company seeks a significant reduction in this tax burden.

Once built, Avangrid will sell the electricity produced by the solar farm through PJM Interconnection, a regional transmission organization (RTO) that coordinates the movement of wholesale electricity in all or parts of Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia and the District of Columbia.

Theoretically, the solar farm could be situated in any of these states. However, competition for the energy development project may be found closer to home. During a meeting held with the three commissioners yesterday, June 7, Jeff Reinkemeyer with Avangrid mentioned that the company is in the early stages of developing a 150 megawatt farm in Van Wert County. In 2013, Van Wert’s commissioners voted to get rid of its AEZ, choosing instead to negotiate Payment in Lieu of Taxes (PILOT) agreements with all energy developers going forward.

Last Thursday, all three Putnam County’s commissioners expressed confidence that nearby counties would not seek to undercut Putnam by offering a lower tax liability. So, it remains unclear how much leverage this possible Van Wert solar farm might bring to a negotiation with Putnam County. Inquires on possible PILOT rates with Van Wert’s commissioners office were unanswered by press time.

When asked, Mr. Reinkemeyer said that Avangrid’s preference would be to build both the newly mentioned 150 mw solar farm in Van Wert and the proposed 150 mw solar farm in Putnam. He indicated that demand for renewable energy on the PJM Interconnection is easily high enough to support both. Still, if the question on building a new solar farm is not ‘if,’ but ‘where,’ and should Putnam demonstrate continued resistance to Avangrid’s proposals, perhaps somewhere else will be more willing.

Because all of the revenue which might flow to the county is entirely theoretical. Assuming that the 1200 targeted acres are all taxed under the state’s Current Agricultural Use Value (CAUV) program, set at $230 for 2018, the land now brings in an estimated $276,000 in property taxes. This is $776,000 less annually than what the $7,000 per megawatt tax would bring to the county, which Avangrid does not seem to have an issue with. It is also $24,000 less per year than the $2,000 per megawatt tax which, it seems, Avangrid has proposed lowering.

In one context, anything less than an annual payment of $300,000 directly to the county’s general fund would be nearly offensive considering the AEZ. In another context, it’s already $24,000 more that what the county currently splits with the township and school. The question becomes, who would turn down any developer, lease agreements in hand, offering significantly more than current tax collection revenue?

Do you have a walk away number, the Sentinel asked the commissioners last Thursday?

“I do,” answered Commissioner Schroeder.