First of two hearings highlights Downeast wind farm’s TIF terms with county

By Lora Whelan | The Quoddy Tides | January 24, 2020 | ~~

Over 60 Washington County residents gathered on the afternoon of January 9 for the first of two public hearings held by the county commissioners in the county courthouse in Machias to discuss the Washington County Downeast Wind Municipal Development and Tax Increment Financing (TIF) District. Commission Chair Chris Gardner explained that the commissioners have no jurisdiction over planning and zoning concerns related to the wind farm development, but the commission can ask for changes in or reject the TIF district in the county’s unorganized territories (UT). He added that the reason for the hearing was to ensure the maximum public benefit from the TIF terms of agreement. “The focus today is the financial aspect.”
Unorganized territories in the state and county, unlike municipalities, are overseen by the Land Use Planning Commission (LUPC), which serves as the planning and zoning authority for the unorganized and deorganized areas of the state, including townships and plantations. These areas either have no local government or have chosen not to administer land use controls at the local level. Unorganized territories usually have lower property taxes because of the lack of municipal governments and schools.
On hand to give an overview of the wind project was Paul Williamson, who manages Apex Clean Energy’s projects in Maine and New England. The Downeast Wind Farm is a subsidiary of Apex. A total of 30 wind turbines are planned, eight in Columbia and 22 in the Washington County UT. There are 40 locations determined as suitable spots, but the farm would only use 30 of them, and the company expects that a few will be winnowed out during the permitting process. “The sites were chosen for proximity to power line infrastructure,” Williamson said. He added that there will be no impact on designated historic sites, no use of eminent domain, and all the land is commercially managed for agriculture or forestry products. Along with LUPC, Downeast Wind is working with the Maine Department of Environment Protection (DEP) and the Department of Inland Fisheries and Wildlife (IFW).
The project is expected to be a $250 million investment by the company, with $28 million going to landowners for land use, $8.4 million for the construction payroll of several hundred jobs, $500,000 in annual direct salaries and $4.2 million in 50 “induced” jobs in greater Washington County. In addition, the mandated community benefit agreement required by the DEP is expected to result in a one‑time payment to $500,000, with $350,000 designated for property improvements around Schoodic Lake, where a number of the turbines will be near. Columbia is expected to receive $280,000 and the unorganized territories $7.5 million for the life of the 25‑year agreement.
Stephen Wagner of the law firm Rudman Winchell, which represents the county, explained the TIF in more detail. The TIF district would cover 14,000 acres. TIF revenue comes from the difference in original and developed assessed value of the project’s property. The property is taxed at the pre‑development assessment, thus avoiding reductions in state subsidies brought on by the increased valuation.
The TIF agreement is to hammer out how the TIF revenues are distributed between the developer and the county. If the county declines to have a TIF agreement with the developer, then TIF revenues are distributed to all the UT districts in the state, which is over half the state’s land mass, explained Gardner, thus highlighting the importance of having an agreement that maximizes the benefit to the county.
As proposed, the TIF agreement would split revenues 70/30, with the developer receiving the larger amount. Over the course of the 25 years, the developer is expected to receive $6.7 million and the county $3.7 million. The county is well versed in TIF agreements and use of TIF funds, with prior wind farm agreements in place. TIF funds have state restrictions on how they can be used, with priority given to economic development, improvement of the TIF district and for infrastructure projects by the developer, among other uses.
The public comment period, lasting for over an hour, appeared to be a lesson in frustration, with very few of those present commenting on the TIF but instead commenting on concerns that would fall under the jurisdiction of the DEP and LUPC. Gardner reiterated, “We’re keenly interested in concerns and comments regarding the TIF. That’s our purview.” He added, “We want to hear issues in the framework of the TIF and credit enhancement agreement.” His words fell on deaf ears. Jay Mills of Jonesport summed up the feelings in the court room when he said of Williamson’s presentation, “This guy brings up more red flags than Gardner’s Lake on fishing day.”

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Comment by Paula D Kelso on January 28, 2020 at 7:50pm

Well I don't know anything for sure cause Clifton town government covers everything up with layers of secrecy. The town meeting voted to give the Select Board the authority to make and administer TIF agreements with both Pisgah Mountain LLC and SWEB. Pisgah has their 5 turbines up and SWEB is heavy into the approval and permitting process for their 5 big ones. [and don't ever forget that SWEB owns 49% of Pisgah] There has been little to no attempt to keep the town's taxpayers informed about how the TIF agreements are written or administered. I believe that all the Pisgah tax revenue (about $250,000 a year) is put into a TIF fund. No, there is no independent committee to oversee it's use or recommend uses. The Select Board does that. My understanding is that most of it so far has gone for capital improvements to town roads. Not sure how that jives up with TIF restrictions that the money go for projects within the TIF district. I've heard that they designated the whole town as a TIF district. The town has about 11 to 12 miles of roads. Lot of money going to keep them suckers ship shape.

The town's budget was a little over a million dollars when this started about 3 years ago. So instead of having $250,000 a year going into the general fund from Pisgah taxes, it goes into a restricted account. It is true if it weren't for the TIF, the town's share of school appropriation would have increaed (it's based on valuation, not enrollment); and the state would have started sending Clifton less revenue sharing; and the county would have increased their appropriation from the town. As it is, Holden and Eddington have a higher percentage of their valuation going to the district budger than would be the case if there wasn't the TIF. Ok, so that's a done deal. Big $$ set aside each year for the selectboard to manage as they see fit and there's no accounting in the annual town report.

Now enter SWEB and the Silver Maple Project. That annual tax bill would likely be somewhere between $450,00 and $550,000. And the selectboard can divert 100% of that from the general fund add that money all to their slush fund. No citizen committee, no meticulous oversight. I can only imagine the projects that are going to be floated in the future.

In my opinion this is not what the TIF provisions were created for. At least so far, this town has not given back even 1 % to the developer. At least that's what I hear. But the Board has the authority to renegotiate and change the terms at will. Lots of out of the blue stuff can happen in the future. Boy, you could carry all the brain cells around in a thimble.

Comment by Dan McKay on January 28, 2020 at 5:34pm

TIFs are meant to create further local economic activity from projects proposed in the locality. The property and equipment taxes are deferred to additional projects in the same area. This means it is deferred from going to the taxpayers as the new economic activity is supposedly going to produce better results for the locality. Unfortunately, it never works this way. The State who developed this scheme never enforces it and the TIF money is usually squandered away by TIF committees.paying for high priced TIF consultants ( yes, that is a  popular racket now, especially among former legislators )   

The fact that the wind developer gets a percentage of these deferred taxes is laughable. As you point out, Penny, where else are they going with this project ?   

The other side of the coin is no TIF and property taxes will go towards the unorganized territory budget, but the State will reduce education and other subsidies which lags behind development depreciation which reduces revenue from the project. Carthage is experiencing this now with a 42% increase in school funding.  

Comment by Penny Gray on January 28, 2020 at 4:58pm

Why do some companies get TIFs and others, not?  Is the proposed Canadian mine at Pickett Mountain near Katahdin going to get a TIF?  Where would these developers build these wind factories if they weren't given a TIF?  I guess I just don't get TIFs.  If the developments were taxed at their real value, wouldn't the tax monies go to the county and wouldn't that offset the loss of state subsidies?

Comment by Dan McKay on January 28, 2020 at 4:27pm

As with all of these projects, a few do well, a lot do poorly. And the ones that are poised to do well have the preponderance of money giving them the advantage of influence.


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CMP Transmission Rate Skyrockets 19.6% Due to Wind Power


Click here to read how the Maine ratepayer has been sold down the river by the Angus King cabal.

Maine Center For Public Interest Reporting – Three Part Series: A CRITICAL LOOK AT MAINE’S WIND ACT


(excerpts) From Part 1 – On Maine’s Wind Law “Once the committee passed the wind energy bill on to the full House and Senate, lawmakers there didn’t even debate it. They passed it unanimously and with no discussion. House Majority Leader Hannah Pingree, a Democrat from North Haven, says legislators probably didn’t know how many turbines would be constructed in Maine if the law’s goals were met." . – Maine Center for Public Interest Reporting, August 2010 Part 2 – On Wind and Oil Yet using wind energy doesn’t lower dependence on imported foreign oil. That’s because the majority of imported oil in Maine is used for heating and transportation. And switching our dependence from foreign oil to Maine-produced electricity isn’t likely to happen very soon, says Bartlett. “Right now, people can’t switch to electric cars and heating – if they did, we’d be in trouble.” So was one of the fundamental premises of the task force false, or at least misleading?" Part 3 – On Wind-Required New Transmission Lines Finally, the building of enormous, high-voltage transmission lines that the regional electricity system operator says are required to move substantial amounts of wind power to markets south of Maine was never even discussed by the task force – an omission that Mills said will come to haunt the state.“If you try to put 2,500 or 3,000 megawatts in northern or eastern Maine – oh, my god, try to build the transmission!” said Mills. “It’s not just the towers, it’s the lines – that’s when I begin to think that the goal is a little farfetched.”

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Hannah Pingree on the Maine expedited wind law

Hannah Pingree - Director of Maine's Office of Innovation and the Future

"Once the committee passed the wind energy bill on to the full House and Senate, lawmakers there didn’t even debate it. They passed it unanimously and with no discussion. House Majority Leader Hannah Pingree, a Democrat from North Haven, says legislators probably didn’t know how many turbines would be constructed in Maine."

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