Wind turbine companies “have lobbied for low or non-existent property taxes and steep depreciation schedules,” meaning little new revenue for rural school districts from the giant windmills that dot the Midwest and Plains, says the Midwest Center for Investigative Reporting and Flatland, a part of Kansas City PBS. In an introduction to four stories about wind power, the MCIR and Flatland say their multi-state collaboration uncovered “how states like Kansas have given away the wind farm.”
“In its rush to attract wind farms, some of which are owned by wealthy foreign-based corporations such as BP (British Petroleum), Kansas offered them something no other state has: lifetime exemptions from local property taxes — the lifeblood of local school funding,” say MCIR and Flatland. They cite Kansas Department of Revenue figures that nearly $630 million of wind farm equipment will never be taxed. “If it were on the tax rolls, that equipment would generate around $82 million a year in additional revenue for the 24 counties with wind farms. Of that amount, more than $32 million a year would go to rural school districts in those counties.” The lost revenue is offset in part by state subsidies that help equalize funding between school districts, says a state education official.
“Instead of taxes and often in return for site approvals, Kansas wind farms have agreed to make relatively small ‘payments in lieu of taxes’ (PILOTs) in all those counties,” say the reporters. “But an analysis by Flatland found that the payments represent only a fraction of what the taxes would be; that they vary widely from county to county; and that county officials seldom direct much of that money to local schools.”
in 2015, the legislature, “in a deal brokered behind closed doors,” dropped a proposed 4.3 percent tax on energy generated by renewable sources and ended the lifetime exemption for wind farms for new construction; existing wind farms kept their exemption from property taxes while new farms get a 10-year exemption from the taxes. Some economists say wind farms provide few permanent jobs and the majority of local benefits are the rental payments made to landowners.
In other stories, Flatland and MCIR say Illinois’ approach to taxing wind power companies “is touted as one of the best in the country,” and by one accounting six foreign-owned wind companies received at least $4.8 billion in federal tax credits from 2000-15.
To read stories by Flatland and the Midwest Center for Investigative Reporting on wind farms and local revenues, click here.