North Dakota Senate bill would shift bulk of wind tax from local governments to state

Source: By Keith Norman, Grand Forks Herald • Posted: Tuesday, January 24, 2017

JAMESTOWN, N.D. — A change in who receives taxes from wind farms is being called an attack on the wind energy industry by one North Dakota legislator.

Senate Bill 2209, as introduced, would take 70 percent of the taxes paid by wind farms and deposit it into the state’s general fund. The remaining portion of the taxes would be paid to the local governments where the wind farm is located.

“It is a terrible bill and an attack on wind,” said Rep. Mike Brandenburg, R-Edgeley, and a long time wind energy advocate. “The sponsor of the bill is from coal country. It is a movement by coal to kill wind energy.”

Currently, all the taxes paid by wind farms are paid to the local governments where the wind farms are located. The taxes are calculated on the capacity of the wind farm to produce electricity and the actual amount of electricity produced. The taxes are apportioned between the local governments based on the mill rates of each district.

Sen. Jessica Unruh, R-Beulah, said the bill is meant to start a discussion on paying some of the taxes on wind farms to the state but also as a response to concerns from residents in her district.

“I’ve heard the arguments about wind versus coal,” she said. “My district contains wind farms and I’ve received numerous complaints about the siting process. I’m fighting for the concerns my constituents have.”

Casey Bradley, Stutsman County auditor/chief operating officer, said the North Dakota Association of Counties testified against the bill during a Senate Finance and Taxation Committee hearing this week.

“It would have a huge impact on the Courtenay area,” he said.

The Courtenay Wind Farm pays about $850,000 per year in taxes. Currently, the Barnes County North School District would receive 52 percent of that or about $442,000. Stutsman County would collect 37 percent or about $315,000. The remaining 11 percent goes to the townships where the wind farm is located and to the Courtenay Fire Department.

Bradley said if the bill were to pass as introduced, each of those entities would receive 30 percent of what they currently receive.

Unruh said the only testimony on the bill came from the Association of Counties and she planned to amend the bill next week to be effective only for wind farms constructed in the future.

She said members of the Senate Finance and Taxation Committee sounded positive about the bill when the amendments were discussed.

“They probably wouldn’t pass it as is,” Unruh said.

Rep. Craig Headland, R-Montpelier, said he probably would not support it as written.

“It is a Senate bill,” he said. “We don’t have it over here (in the House of Representatives) yet to consider.”

Brandenburg said even if the bill is amended, it could still harm the wind energy industry in North Dakota. The amount of taxes paid by wind farms to local governments is critical to the wind energy projects receiving local support from people who will not have turbines placed on their property.

Those people do not see a direct payment from the wind farm but do see a benefit from additional tax revenue for local school districts and townships which reduces their taxes and enhances roads and programs.

Brandenburg said the support of residents within the wind farm boundary could be critical to some projects planned for south central North Dakota in the next two years. The planned projects could amount to a $2 billion investment in the Emmons, McIntosh, LaMoure and Dickey counties. Those projects have not started the process of obtaining site authorizations from the North Dakota Public Service Commission.

“If the state takes all the (tax) money, there won’t be another wind farm built in North Dakota,” Brandenburg said.