A $200 million wind farm is one step closer to construction after Donley County Commissioners approved a tax abatement for the project Tuesday afternoon.
The incentive provides Cielo Land & Cattle, LP, with a ten-year, 100 percent abatement from ad valorem taxes but also sets up payments to the county in lieu of taxes during the period of the agreement.
Cielo, which is developing the project as Salt Fork Wind, LP, will pay Donley County $2,000 per megawatt of electric generating capacity up to a maximum of $200,000 per year. The agreement also stipulates that Cielo will develop a minimum of 80 megawatts of capacity in Donley County, which would result in no less than $160,000 in income for the county annually for ten years.
The first payment in lieu of taxes is due October 1, 2015, the agreement states.
Commissioner Dan Sawyer described the agreement with Cielo as historic as it will mark the first development of wind power in the county.
“This is a historic legendary meeting,” Sawyer said. “It is one of the most important meetings we’ve had since this county was organized.”
In addition to making whatever improvements are needed on county roads to support the project, Cielo also has pledged to spend $1 million during construction to purchase services, materials, and supplies from businesses and individuals in Donley County.
Cielo representative Robert Peña said his company will hold a job fair at some point before construction starts and will also be seeking local vendors and individuals who can perform needed services associated with construction.
Peña declined to give a definite start date for construction but said work would begin in 2014 and that design and development costs are already being incurred this year so that Cielo can take advantage of the expiring federal production tax credit.
The $200 million project will be split with 55 percent in Donley County and 45 percent in Gray County. The Donley portion will be constructed in a 21,700-acre area in the northwestern part of the county and bordered on the north by Interstate 40. Peña said after construction, seven permanent jobs will be created to service the entire project.
Gray County officials have approved a reinvestment zone for that portion of the project and will likely approve a tax abatement there next month. Peña was also meeting with Groom ISD and Clarendon ISD officials this week to work on tax limitation agreements with those schools – an agreement similar to the county’s payment in lieu of taxes but based on each district’s average daily attendance and subject to the scrutiny of the state comptroller.
Peña again confirmed that his company is not seeking tax abatements from the Donley County Hospital District or the Clarendon College District, both of which stand to reap a big windfall in tax revenue when construction is completed.
As part of Cielo’s agreement with Donley County, the company will keep the project improvements in place for no less than 20 years, Peña said.
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