Pulaski County commissioners were upset Thursday morning during a report from Pulaski County Assessor Dan Whittle, where information was given that MC Power, owners of the solar farm equipment in Waynesville, are refusing to pay personal property taxes to the county.
MC Power provided a copy of an agreement between the city of Waynesville and themselves to Whittle to abate real and personal property taxes. Abatement of the taxes means that they do not have to pay them.
Commissioners say they never agreed to abate any taxes that would be owed to the county and that Waynesville didn't have the authority to agree to anything on behalf of the county. Presiding Commissioner Gene Newkirk took particular issue with the wording in the second paragraph of the agreement.
"In full reliance on the provisions of HB142 of the 97th General Assembly of Missouri, statute 137.100 RSMo and by Pulaski county for full abatement of all personal and real property taxes, on December 1, 2016 and every December 1 thereafter for the term of the Agreement and during with period all real and personal property taxes are fully abated," Newkirk highlighted this particular wordage in the agreement and said the city could not speak for the county.
HB142 changed laws regarding utilities, especially concerning solar systems. "The bill adds solar systems not held for resale to the list of property and items that are exempt from taxation for state, county, or local purposes under section 137.100 RSMo," according to house.mo.gov.
Whittle and the commission agreed that they interpreted that to mean private citizens who put solar panels on their house, not businesses, and not a business that was creating power to go into a city's power grid that the citizens were paying for on their electric bills.
Newkirk said he was "riled up" about the issue and the other commissioners agreed. MC Power deeded the actual property that the solar power plant sits on back to the city, making the property exempt from property taxes, but the business equipment, according to Whittle is not exempt from business personal property tax.
"The city cannot unilaterally sign something abating for the county," Newkirk said.
The total assessed value of the personal property tax is $ 958,240. The total taxes due for 2017 are $39,146.02, of which $28,268.08 is supposed to go to Waynesville School District, $1,882.94 is supposed to go to Road and Bridge, $287.47 is supposed to go to the state, $688.02 is supposed to go to the Health Department, $427.38 to the Senior Citizens Center, $684.18 to the Senate Bill 40 (SB40 Board) Handicapped Services Board, $1,294.58 is supposed to the Pulaski County Library District, and $5,613.37 is supposed to go to the city of Waynesville.
In the agreement Waynesville signed to abate the taxes, MC Power paid Waynesville $230,000 in a lump sum to the city. MC Power offered the County Commission $10,000 to abate the taxes, according to Newkirk, but the commission turned the money down.
Newkirk said he didn't feel the commission had the authority to abate taxes that benefit so many entities, pointing out that the $28,268.08 owed to the school district adds up, over 10 years, to over $280,000.
Western District Commissioner Rick Zweerink asked Whittle if the city was aware they were costing the school district the money.
Whittle said that was why he had brought the problem to the attention of the County Commission. He also said that the solar farm isn't the only property that "has been done this way."
According to Whittle the Waynesville Patriot 12 theater also does not pay property taxes.
Newkirk pointed out that the senior citizens, the library, and the SB 40 Board, which governs the Sheltered Workshop and Handicapped services in the county, were all losing out on money that helps support those entities.
"Maybe the city of Waynesville does disperse that money among the tax entities, I don't know," Whittle said of the money MC Power agreed to pay the city.
Whittle also said he could be misunderstanding something and that the city only meant to abate any taxes owed to them, not the county as well.
Whittle also said that other assessors are having similar issues with solar power companies and believes they are waiting for case law to make a decision because the statute isn't as clear as it could be.
County Clerk Brent Bassett said that the solar farm was close to one million in assessed value that would be taken away from the county.
Eastern District Commissioner Lynn Sharp asked if the equipment could be confiscated if taxes aren't paid, like the county can sell real estate property when property taxes aren't paid for a period of time.
Whittle said personal property didn't work the same way as real estate property taxes and it was in an area where there are still questions.
The Daily Guide reached out to the city of Waynesville for comment and City Administrator Bruce Harrill responded, via email.
"In response to a local controversy, I would like to express the City of Waynesville’s support for green energy as the wave of the future and bring attention to the many tangible and intangible benefits solar energy brings to our community," Harrill wrote.
Harrill went on to say that the city feels the solar farm "is a great addition to our community. It provides green energy to 350 to 400 homes, and it is energy that is produced and used locally. This solar farm like the neighboring solar farms in Rolla and Lebanon, are a source of renewable energy that helps to keep our electric rates low and benefits our environment. Although, we are not required to use renewable energy, the State of Missouri Energy plan has established guidelines for Cities to get 15% of our energy from green sources and we have elected to reach and exceed these guidelines."
On the question of the tax issue, Harrill said the city owns the land and is therefore tax exempt, just as the county is on land it owns.
"It is also our understanding, that in accordance with State Law, that Solar Energy Systems are also exempt from State, Local and County taxes, whether the systems are privately or publicly owned. I believe that this exemption recognizes the value that our Nation and State places on green renewable energy," Harrill said.
The Daily Guide will continue to follow this story as it develops.