GOLIAD – When Goliad County Judge Mike Bennett took office he was determined to bring industry to the county to increase its tax base, saying the county – strapped by years of relying on transferring money from its reserves to meet its budget – could not solve its fiscal problems “with another dress shop.”
One of those industries is a proposed solar farm in the extreme western part of the county near Tulsita planned by the Austin-based Caprock Renewables Company.
The planned $300 million facility – on 2,100 leased acres – would produce 680,000 megawatts of electricity a year which would be connected to a nearby transmission line running to the distribution farm adjacent to the Coleto Creek Power Plant.
The generated power is sufficient to power 45,000 homes.
The Goliad Commissioners Court created an investment zone at the proposed site, which was the first step in granting a tax abatement, which the court also did.
While the court received the company with open arms, the same was not true when it approached the Goliad Independent School District for a similar abatement.
Board President Brandon Huber and Trustee Trey Wimberly both expressed doubts, based on uncomfortable results from its granting a tax abatement for the DCP Midstream plant, which subsequently went into litigation with the Goliad Appraisal District each year to protest its appraisal.
“We were burned badly and we would like to avoid that,” Huber told Caprock representatives in November.
The trustees’ concerns were mirrored by Goliad Chief Appraiser Richard Miller who told the board that because GISD was a Chapter 41 school district, any financial benefit the district would see from the abatement would go directly to the state.
“The purpose of the agreement is to benefit the school in several ways, not just property tax. It also means bringing jobs and families who will put their children in school … this project doesn’t do that because (when completed) it only will create one full-time job,” Miller says.
Cognizant of GISD’s reticence, Evan Horn, manager of Tax Services in Austin – he serves as Caprice’s financial advisor – suggested a different plan to GISD trustees Jan. 13.
Caprock is anxious, Horn says, “because an agreement with the school board is absolutely critical for a project like this to work.”
Translation: No GISD agreement, no solar farm.
“What we are asking the school board to consider,” Horn says, “is not an abatement. It’s a value-limitation agreement (VAA). Instead of (GISD’s) foregoing some taxes in an abatement, the project is taxed at an amount set by the Texas Comptroller’s Office.
“The key difference,” Horn emphasized, “is that the school district does not lose any funding. The district only benefits.”
Under the proposed agreement, the district would receive $123,000 in payments over 15 years which, Horne says, would not be subject to recapture payments to Austin.
The state takes, or re-captures, funds from what are considered rich school districts.
“GISD would be held harmless from any losses occurring from entering into a VAA,” he says.
“The total benefits for the school district for entering into an agreement is close to about $4 million over the 15-year life of the agreement.”
Bennett is astonished about the GISD’s reluctance.
“It’s a no-brainer,” he says. “The county will gain almost $250,000 a year. Everyone who lives in the school district lives in the county. Why wouldn’t the school district want what’s best for the county?”
The increased value of the land when a solar farm is built on it is another benefit, he says.
“When you have a piece of property,” he explains, “and it moves from ag use to non-ag, you go back three years and recover the taxes that you would have drawn. When people say there’s no value to this, I have a hard time understanding it.”
Caprock General Manager Raina Hornaday stressed that she didn’t wish to sound as if she was making threats, but landowners and Bee County officials have expressed a strong interest in hosting the facility just over the river from its planned location.
“The same people own the land on both sides of the creek,” Bennett says. “The secret is, the sun shines all over Texas.”
Hornaday says Caprock is scheduled to seek the board’s approval at its regular session Feb. 10.