Let’s Be Consistent - Standard Tax Assessment Model for Renewable Energy Projects: Revenue Bill Part X, S. 2509/A. 3009

By Jeff Jones

Last year’s historic legislative accomplishment for renewable energy was epitomized by passage of the Accelerated Renewable Energy Siting Act, which created the new Office of Renewable Energy Siting (ORES) and launched a process to improve and standardize siting requirements. By law, the new ORES rules are due by April 1st and all indications are that they will be done on time.

But that’s not all New York needs to meet the ambitious goals set by the Climate Leadership and Community Protection Act. To move us further down the road to the economic and public health benefits of our clean energy future, the state needs to create a standard tax assessment model for renewable energy projects. Fortunately, New York has undertaken the task by including provisions in the Governor’s proposed 2021-22 state budget. Part X of the budget requires state agencies to develop and publish a standard methodology for the assessment of wind and solar projects. And, while the law will lead to more consistency, critical to the both the developers and local communities, Part X will also continue to allow municipalities the option of negotiated Payments in Lieu of Taxes (PILOTS).

More renewable projects – especially wind and solar – are coming to Upstate New York. With the lowering of costs and technological advances the renewable industry is making, these are fast becoming the backbone of the state’s energy infrastructure. It’s time to get the kinks out of an unwieldly process and really modernize so New York can move forward to its clean energy future.

According to renewable energy developers, the main thing missing under the current taxation system is consistency. It’s very difficult to plan a multi-million dollar project, even when it is prioritized in state law, when such a key component as the local tax rate is subject to wildly different interpretations. When passed as part of this year’s state budget, Part X will empower state tax officials to develop recommendations to inform local tax rates. Towns and counties will still be able to choose to exempt renewables from property taxes, negotiate a PILOT agreement, or use a more traditional assessment method. And if they go with option three, the model published by the State and can guide their assessment.

This means more consistent taxation levels, more projects reaching construction, more renewable energy, and more clean energy jobs across New York.