Original Post Made By: Facebook User David Herman, in the Facebook Group: Stop Solar Farms
November 3, 2020
Is there anyone in this group with a good understanding of taxes, explain the pro's and cons of a TIF, (Tax increment financing) and what good or negative effect they might have involving a solar or wind project?
Thanks
Tax Increment Financing
Re: Tax Increment Financing
Michael Joe Hamlet
Jason Potts I'm going to defer to the expert here if you would be so kind...
Jason Potts I'm going to defer to the expert here if you would be so kind...
Re: Tax Increment Financing
Lynne Bruning
Some towns/counties use a Payment of Lieu of Taxes (PILOT) for solar and wind development. I've not heard of municipalities using Tax Increment Financing (TIF) which generally requires the neighborhood to be declared blight and the development authority would then collect the taxes to incentivize other projects in the neighborhood. Whats the name of the project and its physical address please? I'm very curious how the TIF would work for solar/wind power plants.
Some towns/counties use a Payment of Lieu of Taxes (PILOT) for solar and wind development. I've not heard of municipalities using Tax Increment Financing (TIF) which generally requires the neighborhood to be declared blight and the development authority would then collect the taxes to incentivize other projects in the neighborhood. Whats the name of the project and its physical address please? I'm very curious how the TIF would work for solar/wind power plants.
Re: Tax Increment Financing
David Herman
Michael Joe Hamlet
Jason Potts
Lynne Bruning
Mike, I want to start of by thanking you for bringing in an expert to assist me. At least this time it wasn’t an ambulance and helicopter. (That was an inside story to the man that literally saved my life, due to his CPR training.)
Jason, I also want to thank you for clearing up some of the fog. Lynn, in response to your question, the original question was in response to a post I read involving complaints about a couple of local County Commissioner’s and while it originally talked about an AK Steel Plant in our county, it also mentioned the AEP Power Plant, that is going to be shutting down, after just changing their plant over to meet the Obama era standards AND Vectren, who is based in Evansville, Indiana and is the electric company that took over at least one of the solar developments in our county, (the one in Troy Indiana) plus we “believe” they will also be taking over the one by our home, since our attorney had to drop us as clients due to a “conflict of interest” with Vectren.
Anyway, I know this has been a long response and it is about to get longer because I am posting “PART” of the original post that inspired the original question. Thanks to all.
County Councilman Dave Gogel and Commissioner Tom Brown led the effort to dissolve the AK Steel TIF. Their actions - which were opposed - led to the first, and only, dissolution of a productive TIF since they were introduced in Indiana about 35 years ago. This action effectively handed out-of-town shareholders of AK Steel $15.5 million. This ill-conceived action also provided AEP and Vectren with additional tax breaks of approximately $3.5 million.
That was a bad decision. It was bad for Spencer County and bad for our taxpayers. Here’s advice from Indiana Tax Expert and Purdue University Professor Larry DeBoer: “You TIFed an area, the development happened, you paid off the bonds, but you don’t let the TIF expire. You can then use it for whatever development opportunity that comes along.”
Did you know that since 2009, Spencer County has spent millions of tax dollars to fight legal battles with AK over unrelated property tax disputes?
Today, Spencer County has few additional resources. We face issues such as rising tax rates in South Spencer, struggling schools due to dropping enrollment, underfunded law enforcement, financing broadband, a crumbling jail, and renting unsecured buildings to conduct county business.
In 2017, the AK Steel TIF had served its purpose incentivizing AK Steel to locate in Spencer County. However, the life of the TIF was not over - it still had 10 years left. With proper planning, vision, cooperation and effort, the county could have captured $5.5 million a year for TEN YEARS to make Spencer County a better place for us all.
Michael Joe Hamlet
Jason Potts
Lynne Bruning
Mike, I want to start of by thanking you for bringing in an expert to assist me. At least this time it wasn’t an ambulance and helicopter. (That was an inside story to the man that literally saved my life, due to his CPR training.)
Jason, I also want to thank you for clearing up some of the fog. Lynn, in response to your question, the original question was in response to a post I read involving complaints about a couple of local County Commissioner’s and while it originally talked about an AK Steel Plant in our county, it also mentioned the AEP Power Plant, that is going to be shutting down, after just changing their plant over to meet the Obama era standards AND Vectren, who is based in Evansville, Indiana and is the electric company that took over at least one of the solar developments in our county, (the one in Troy Indiana) plus we “believe” they will also be taking over the one by our home, since our attorney had to drop us as clients due to a “conflict of interest” with Vectren.
Anyway, I know this has been a long response and it is about to get longer because I am posting “PART” of the original post that inspired the original question. Thanks to all.
County Councilman Dave Gogel and Commissioner Tom Brown led the effort to dissolve the AK Steel TIF. Their actions - which were opposed - led to the first, and only, dissolution of a productive TIF since they were introduced in Indiana about 35 years ago. This action effectively handed out-of-town shareholders of AK Steel $15.5 million. This ill-conceived action also provided AEP and Vectren with additional tax breaks of approximately $3.5 million.
That was a bad decision. It was bad for Spencer County and bad for our taxpayers. Here’s advice from Indiana Tax Expert and Purdue University Professor Larry DeBoer: “You TIFed an area, the development happened, you paid off the bonds, but you don’t let the TIF expire. You can then use it for whatever development opportunity that comes along.”
Did you know that since 2009, Spencer County has spent millions of tax dollars to fight legal battles with AK over unrelated property tax disputes?
Today, Spencer County has few additional resources. We face issues such as rising tax rates in South Spencer, struggling schools due to dropping enrollment, underfunded law enforcement, financing broadband, a crumbling jail, and renting unsecured buildings to conduct county business.
In 2017, the AK Steel TIF had served its purpose incentivizing AK Steel to locate in Spencer County. However, the life of the TIF was not over - it still had 10 years left. With proper planning, vision, cooperation and effort, the county could have captured $5.5 million a year for TEN YEARS to make Spencer County a better place for us all.