A tax break for one business is not a planWritten by Scott McLeod
Before Haywood County commissioners approve a request to cut property taxes on a business that plans to build an $8 million solar farm near Canton, they need to get serious about developing a long-term green collar industry incentive package. One break for one company seems more like a handout, which in this day every other company could find fault with.
On the surface the request seems almost inconsequential given the relatively small amount of money involved, about $32,000 over five years. In this economy, however, many will be watching the commissioners very closely. A whole lot of local, long-time businesses are struggling to keep people employed while paying their taxes in full.
FLS Solar Energy is planning what is billed as the largest solar farm in the Southeast on an old landfill in Canton. It will install 3,200 solar panels on seven acres that will produce enough electricity to power 1,200 homes. The company has signed a 20-year agreement to sell the electricity to Progress Energy. The utility giant must, under state law, start producing an increasing percentage of its power from green sources.
The announcement late last year that Haywood would be chosen for the solar farm was met with near universal excitement. Although the project won’t produce any long-term jobs, it is being hailed as a coup for Haywood County and Western North Carolina. Row upon row of solar panels will track the sun from an old landfill, proving that this region cares about energy production and global warming, perhaps providing some intangible benefits when it comes to business recruitment. It’s difficult to gauge the economic development benefit of having the largest solar farm in the Southeast (though it’s likely a larger facility somewhere won’t be far behind), but most believe that benefit is more symbolic than tangible.
FLS, for its part, is asking for help to make it through its first five years in opration. The $32,000 it wants Haywood County to forgive amounts to 80 percent of its business property taxes for the first five years it is in operation.
But here’s the rub: even though the request has the endorsement of the county Economic Development Commission, it doesn’t meet existing criteria for the tax break. Specifically, to get the 80 percent tax break the county’s guidelines say the project needs to create 100 jobs and have an investment of at least $10 million. This project is expected to employ 12 as it’s built and no one after it is up and running, and it already qualifies for the federal government’s 30 percent solar energy tax break.
Projects like this are appealing for many reasons, one of which is the “coolness” factor. That line of thinking says if you support green projects, you are cool and everyone will want to join in. But that’s a weak foundation for county policy.
If Haywood wants to become an epicenter of green energy and environmentalism, giving a one-time handout to a solar farm won’t get it there. Instead, county leaders need to develop an array of tax breaks, grants and incentives for new businesses engaged in green technology and for existing businesses that become energy efficient and recycle. In this case the fact that old landfill property is being used is probably more significant than the solar energy aspect of the project.
The green initiative being led by Haywood Community College President Rose Johnson and flourishing under the auspices of HCC and the Haywood County Chamber of Commerce should be encouraged and embraced. The county’s effort to get methane energy from the old landfill is also worth touting. The role of the Commission for a Clean County should be expanded and officially endorsed by the county.
Yes, Haywood County could benefit immensely by becoming a leader in all things green, and businesses and people in the mountains have been embracing this philosophy for decades. But there is a competition out there. Local governments across the nation are also trying to grab this mantle. Haywood needs a long-term plan and a real investment to get there. Helping this company might be symbolic of where the county wants to go, but approving this tax break isn’t really all that progressive. In fact it is simply applying an old-style economic development model to a new industry.
We wish FLS great success, and solar energy is a crucial component for meeting future energy needs. From Haywood County’s perspective, however, approving this tax break at this time is like putting the cart before the proverbial horse.