Windmills hold no windfall for El Paso County

A plan to erect an array of windmills in eastern El Paso County won't be blowing a yearly windfall the county's way.

That's because wind energy facilities are considered business personal property, and the county ditched its personal property tax about a decade ago.

El Paso, the only county in the state to abolish its business personal property tax, phased it out under pressure from the Chamber of Commerce. Chamber officials argued getting rid of the tax would help recruit new business and industry.

The project, though, will bring in some one-time cash to county coffers.

If California-based Clipper Windpower, Inc.'s project is built, the county would receive use tax on construction materials, a one-time levy worth roughly $1 million, depending on actual costs.

The county also would collect about $225,000 in one-time development fees.

But it would forfeit annual property taxes that could have netted the county hundreds of thousands of dollars a year.

"To the extent we don't charge a tax for that, we're going to miss out," County Commission Chairman Jim Bensberg said.

He said commissioners can cut or omit taxes but cannot reinstate them. Only a vote of the people can do that.

A Clipper official told county planners this week the firm wants to erect 103 wind turbines, a maintenance facility, a substation and transmission lines on thousands of acres east and southeast of Calhan.

County development services project manager Craig Dossey said the company plans to apply this summer to build the windmills. Clipper told the county it would hold two or three public meetings with neighbors.

"Most of the (tracts) they are anticipating putting these turbines on they have under contract," Dossey said. The company will lease the land, not buy it.

"They were pretty positive," he said. "They did some monitoring poles in the last couple of years. This is a result of that, so they must see a potential there by virtue of those monitoring poles."

He said the company representative hasn't said who will buy the power. Colorado Springs Utilities said the city hasn't talked with Clipper about being a customer.

El Paso County Assessor Mark Lowderman said wind facilities are assessed by the State Tax Commission, because they produce a product - energy - that crosses county lines when placed on a grid.

"Because of the nature of the equipment, it is classified as state assessed personal property, not real property," Lowderman said. "That's good for everybody but El Paso County, since we do not levy personal property tax."

Lowderman said based on his talks with industry officials, a typical wind farm is valued at $350 million. If the county had a personal property tax in place, it might receive up to $800,000 a year in taxes, he said.

Logan County, which has four wind farms, receives $953,000 a year in taxes, said Assessor Peggy Michaels.

Logan county taxes about 240 windmills, and another 160 are expected to be built soon, she said.

"It adds a lot to our total assessed valuation," she said. "For us it makes a big difference."

In addition to Logan, which has four wind farms, there are four others in the state - two in Weld County and one in Bent County, said JoAnn Groff, state property tax administrator.

It's unclear what role, if any, El Paso County's personal property tax exemption played in Clipper's decision to build windmills in the county. Company officials did not return a phone call seeking comment.

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