County approves reduction of ‘sun tax’
Riverside County supervisors signed off today on anagreement that will end further litigation stemming from a legal challenge to acounty policy mandating that solar power developers pay fees of $450 per acrefor projects on county land.
“This required many months of hard work and tough negotiations,” saidBoard of Supervisors Chairman John Benoit. “`It’s a step in a very positivedirection. Not everybody may be happy, but at least everybody is inagreement.”
The Independent Energy Producers Association and the Large-scale SolarAssociation worked out an agreement with county attorneys that was certifiedWednesday by a Superior Court judge and was placed on the board agenda todayfor final approval.
The vote was 4-1 in favor. Third District Supervisor Jeff Stone castingthe dissenting vote, saying the county would be setting itself up to be under-compensated for permanent changes to open space stretching 130 miles.
“From Cabazon to Blythe, you’re going to see nothing but a sea of blacksolar panels,” Stone said. “This will be visually obtrusive, and I don’tbelieve we’re going to be receiving the appropriate revenue to ensuremitigation of these visual obstacles along what’s supposed to be a scenichighway.”
Under the negotiated deal, the county will slash the per-acre feesimposed on solar power developers from $450 to $150. However, the county willalso scrap incentives that were enshrined in the original policy to reducedevelopers’ expenses, and will also mandate a 2 percent annualized increase infees for as long as county property is in use by a solar electricity generator.
In exchange for chopping the per-acre fees by nearly 70 percent, solardevelopers will take steps to ensure the county’s full receipt of sales and usetaxes associated with construction of a project, according to the agreement.
The Independent Energy Producers Association and the Large-scale SolarAssociation jointly filed suit in February 2012 in response to board policy B-29, which the supervisors enacted in November 2011 to ensure the county wascompensated for utilization of land that might otherwise go toward farming,recreation and housing.
At the time, Benoit emphasized that solar farms would ever-after mardesert landscapes.
The plaintiffs equated the per-acre fees to an illegal “sun tax,”arguing that the monetary charges violated Proposition 26, the “Stop HiddenTaxes” initiative approved by voters on Nov 2, 2010, as well as the stateMitigation Fee Act of 1987, which permits local agencies to charge developersfor the use of public services — but only to compensate for a specific projectimpact.
According to the IEPA and LSA, the county needed voter approval beforeimplementing what amounted to a tax. The county argued the fees tied to thefranchise and development agreements that solar power providers would berequired to enter into as a condition of operating in the county were analogousto the payments required of traditional power plants when they used countyresources and rights-of-way.
Stone argued today that county voters should be given the opportunity todecide whether the per-acre fees should be $450 or lower. He said a votewould also put to rest any further questions about whether the county wasimposing an illegal tax, which County Counsel Pamela Walls insisted was not thecase.
“There’s going to be billions of dollars made by these (solar power)companies, many of which are foreign-based,” Stone said. “They’re getting thebargain of a lifetime. Let’s let citizens have the final say what the feeshould be.”
Benoit replied that the issue needed to be resolved after 18 months oflegal wrangling — and for the sake of giving companies certainty of what toexpect insofar as doing business in the county, instead of waiting another yearfor a “two-thirds plebiscite” to decide the matter.
“It’s time to move forward, ” the chairman said. “No one getscompletely what they want in this type of situation. But it’s a fairsettlement.”
At the time of B-29’s implementation, more than 20 solar power projectswere in the works in the desert spanning the Coachella Valley to Blythe. Sincethen, several have been delayed or dropped altogether.
According to county officials, Riverside County contains 200,000 of theroughly 300,000 acres in California eyed for solar development.
According to the county Transportation & Land Management Agency, atypical 50-megawatt photovoltaic plant requires 250-350 acres of land, while agas-fired power plant needs about one-tenth that amount of turf to produce 16times as much electricity.
A county-commissioned report by David Kolk of Complete Energy ConsultingLLC estimated the county would rake in about $160,000 annually — beforerebates — from a typical 50-megawatt solar provider operating on a 250-acretract. That figure, however, was calculated using a per-acre fee of $640, which is what the county originally proposed before outcries during publichearings led the supervisors to agree on a lower amount prior to ratifying B-29.
“We appreciate the board’s attention to this matter,” said IEPAExecutive Director Jan Smutny-Jones. “The settlement is fair to the county,fair to our members and will allow them to move forward.”
