Jim Headley thought the terms of the Prairie Winds wind farm were straightforward.
While he and other landowners who allowed turbines on their property would get healthy kickbacks from the agreement, the development by Basin Electric, which began more than a decade ago, also promised an abundance of tax dollars jettisoned into the pockets of the schools, county and townships in parts of Jerauld, Aurora and Brule counties.
But, about five years into the wind farm’s operation, the agreement changed.
It wasn’t the fault of the wind farms, nor the landowners; rather, a compromise in Pierre to better fund education across the state effectively punished schools previously awash in wind farm cash.
The agreement gave these schools the full windfall for five years from the beginning of a given wind farm's production and then, over the next five years, in practice moved some of those dollars into the statewide education fund.
“We got screwed over,” said Headley, a White Lake landowner who was one of the chief proponents of the wind farm project at the time. “The politicians in Pierre socialized the wind farm money that was supposed to go locally.”
The change was referenced multiple times during an April 27 hearing in Platte over a proposed pumped storage project on the Missouri River in Gregory and Charles Mix Counties. Though the current tax code would keep those pumped storage tax dollars local, landowners felt their worries of lawmakers “equalizing” those dollars across the state were substantiated by the recent memory of the wind farm change.
“We just went through this in Tripp with the wind turbines in the last five, six years,” Rep. Marty Overweg, of New Holland, said during the presentation put on by the energy companies behind the project. “The big schools and lawmakers got the law changed in South Dakota then. So your money is not going to come to the small schools in the vast number you said."
Outside of some minor changes to how schools can handle wind energy funds and how they’re counted, lawmakers representing the mainly rural districts affected by the change have had little luck fighting back.
“I'm just learning to live with it. Not saying I'm really happy about it. It's just what it is. You win some, you lose some,” said Sen. John Wiik, of Big Stone City. “We moved the needle at times to try and make a difference, but I think that's as far as we're ever going to move it in the current political landscape.”
Change in wind farm windfall stems from statewide education funding overhaul The changes to the status quo of some of the taxes generated by wind farms and their relationship with local schools came in 2016, part of an overhaul to education funding that came alongside the half-cent sales tax increase and increased teacher salaries.
To keep things simple, schools in South Dakota are a sort of glass. The size of the proverbial glass is determined by an annual calculation unique to each district, based on total need.
Once the size is determined, the glass is first supplied with “local effort” dollars, mainly made up of local property taxes, and then filled to the brim with state funding.
Source: mitchellrepublic.com
Categories: South Dakota, General