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Windmill farm gets county approval

A proposed wind farm in northern Young County took a major step toward reality Monday when commissioners voted to approve a tax abatement plan for British Petroleum. After more than two hours of negotiations between BP and representatives from Young and Archer counties, Young County legal counsel Alan Carmichael announced an agreement had been reached.

Aproposed wind farm in northern Young County took a major step toward reality Monday when commissioners voted to approve a tax abatement plan for British Petroleum.

After more than two hours of negotiations between BP and representatives from Young and Archer counties, Young County legal counsel Alan Carmichael announced an agreement had been reached.

"I'm really happy to announce we have an agreement," Carmichael said. "The primary issue that was standing in the way was a threshold agreement. What we have agreed is there's a minimum threshold of 125 megawatts to be 75 in Archer County and 50 to Young County."

Getting an agreement was a surprise in itself after Carmichael told commissioners an earlier proposal had been altered.

"We came to what we thought was close to an agreement," Carmichael said.

"We were waiting for the numbers to come back. They did come back, but there were a few developments."

Carmichael said both counties were hoping for a minimum guarantee from BP which did not come. In addition, there were some disagreements on how long BP would guarantee it would stay in the county, road maintenance, reimbursing attorney's fees and allowing the... more [truncated due to possible copyright]  

A proposed wind farm in northern Young County took a major step toward reality Monday when commissioners voted to approve a tax abatement plan for British Petroleum.

After more than two hours of negotiations between BP and representatives from Young and Archer counties, Young County legal counsel Alan Carmichael announced an agreement had been reached.

"I'm really happy to announce we have an agreement," Carmichael said. "The primary issue that was standing in the way was a threshold agreement. What we have agreed is there's a minimum threshold of 125 megawatts to be 75 in Archer County and 50 to Young County."

Getting an agreement was a surprise in itself after Carmichael told commissioners an earlier proposal had been altered.

"We came to what we thought was close to an agreement," Carmichael said.

"We were waiting for the numbers to come back. They did come back, but there were a few developments."

Carmichael said both counties were hoping for a minimum guarantee from BP which did not come. In addition, there were some disagreements on how long BP would guarantee it would stay in the county, road maintenance, reimbursing attorney's fees and allowing the county to withdraw the offer if the Texas attorney general ruled abatements were not legal.

Carmichael did say that BP had agreed to make a significant investment in Young County one way or another.

"Both counties were expecting a floor," Carmichael said. "The proposal was for a 250 megawatt project. We recently learned they were planning to put 100 megawatts in next year. In lieu of that, what we achieved in the last meeting was if they put anything in Archer County, Young County would receive at least an interconnectivity facility."

Carmichael said receiving the guarantee was important to commissioners because Young County was leery about offering an abatement when there was a possibility the county would receive little in return.

"We want something significant to start this process," he said.

Carmichael said one of his big concerns was that BP changed the contract to reflect it would guarantee to stay in Young County for 13 years, rather than the 20 the county had asked for. He explained that it is traditional in abatement agreements to ask the business to stay on for double the amount of time taxes are abated. With the requested abatement at 10 years, he said it was fair to ask for a 20-year commitment.

"They have come back at 13 years, so we're between 13 and 20 years," Carmichael said. "In my opinion, their offer is not an offer because it's what they required to do anyway."

Carmichael explained that under state law, when school districts agree to payments in lieu of taxes, the business involved must guarantee it will be in place 13 years.

David Gonzalez with BP explained that the company changed the length to 13 years not because it intended to leave but because it wanted the contracts with the two counties and Olney ISD to be consistent.

In general, Gonzalez said the sides were almost in agreement. "I don't think we're all that far apart," he said. "We're still intending to build the project we laid out from the outset. We're still planning to build a 250 megawatt project. We just might be able to build 150 megawatts next year."

Gonzalez did admit that BP was unwilling to guarantee more than 100 megawatts if the project was built.

That bothered both counties, with Archer County attorney Jay Cantrell saying the abatement being offered was established with a large project in mind.

"The rationale that is kind of at play is the size of the project is in relation to what we're willing to do," Cantrell said. "We've compromised more than we probably would if someone came in with a smaller project."

Gonzalez explained that while BP hoped to build a large project, some elements were out of his control. He explained that the exact location of the turbines would be decided on a lot of factors. One such element is that because wind turbines cannot be built over existing or old oil wells, some planned locations have already been moved. Because of that, BP was having a difficult time guaranteeing a certain amount of revenue, Gonzalez said.

"We've tried to give ourselves some flexibility so if the turbines have to be moved from one county or another, the taxes can go up or down," he said.

At no point would the project get under 100 megawatts. We're still planning to build 250 megawatts, but it would never be smaller than 100 megawatts."

In regard to road maintenance and attorney's fees, Gonzalez said BP changed the agreement because they wanted to match an abatement Archer County had agreed to with another company.

"We fully intend to maintain the roads, but we want to be treated the same as everyone else," he explained. "I hope we're close to getting this thing done. There's still a little bit of a gap between the two parties, but like Young and Archer counties, we think this is a good project, and we hope to get it done."

Carmichael agreed, saying the parties should meet right then and not quit until an agreement was reached.

Two hours later, Carmichael told commissioners everything was finalized.

"The agreement will provide it has upward mobility," he said. "If the project goes up, the payment will go up. The other issue we resolved is we're going to require a minimum presence of 20 years which will give us an opportunity to recoup the taxes we abated."

Carmichael said the agreement was not assignable, meaning BP could not sell it or transfer it to another company, without approval of commissioners court. BP also agreed to maintain the roads and pay all attorney costs.

"The only issue yet to be resolved is on the attorney general's opinion," Carmichael said. "That's a legal issue. I am to meet with their attorney. I can see where BP is coming from, and I think we're on the same page."
After the agreement was reached, commissioners voted 3-0 to approve it.

Commissioners John C. Bullock, John Hawkins and Jimmy Wiley voted yes while County Judge Stan Peavy III abstained and R.L. Spivey was absent.

"We hope to have the final form of the agreement approved by Archer, Young and BP this week so we can mail it to the other taxing entities so we can have them finalized by Dec. 8," Carmichael said. "BP met us more than halfway."

Gonzalez said he was relieved the negotiations were over.

"We're appreciative for everyone's time and patience to work on this," he said. "We're excited. We're looking forward to being a part of the business community."


Source: http://www.grahamleader.com...

NOV 18 2008
http://www.windaction.org/posts/17963-windmill-farm-gets-county-approval
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