Lincoln City Council
Aldermen re-visit enterprise zone designation for solar farms

 

[March 25, 2021] 

Lincoln aldermen endured a lengthy Committee of the Whole meeting on Tuesday night with several important topics coming up for discussion and possible future action. Among the items discussed was whether or not to place approval of solar farms for enterprise zone eligibility on the next voting session.

The discussion was complicated by the fact that aldermen were actually considering two actions. Voting to allow solar farms is a generic action that would encompass any solar farm wishing to come into the county. At the same time, the council is considering issuing a permit to Mulligan Solar Farm so that the company may take advantage of enterprise zone perks such as exemption from sales tax on materials purchased.

Both actions require dual approval from the Lincoln City Council as well as the Logan County Board.

The Logan County Board had approved that solar farms could be in the enterprise zone and approved Mulligan’s request to be added, but then later had second thoughts on their decision. They revisited the topic at their March meetings, and by way of a failed motion to rescind Mulligan’s request, their approval stands. There was no motion to rescind adding solar farms to the enterprise zone. So, both approvals stand.

The city had also discussed the allowance of solar farms, but had not made a decision. Aldermen decided to wait and see what would happen when the county re-addressed their vote.

This week, Acting Mayor Tracy Welch said that he had been invited to attend the county board meeting regarding solar farms. He said that Mulligan had upped their offer for enterprise zone status by adding a $50,000 stipend to the city and also outlining when and how the enterprise zone decertification would take place.

[Decertification would remove Mulligan from the EZ and the 1.4 sq. miles would be returned the zone for use to attract other business developments.]

The $50,000 would be paid out at a rate of $10,000 per year for five years.

Decertification would take place within that five year period but could take place sooner based on when the construction phase of the solar farm project was completed.

Tuesday night the first to question the proposal was Steve Parrott. He asked about the life span of the solar farm. Erin Baker with Mulligan was on the phone and said that typically the lifespan would be 30 years. When the solar farm is no longer going to be a solar farm it would be decommissioned.

Decommissioning would involve removal of solar units, cables, etc. and the land would be restored to its original condition. A decommissioning agreement for anticipated costs would be in place before building permits are issued.

While the enterprise zone stipend was to be paid out over a five year period, Parrott felt that the money received, when spread over the life of the farm wasn’t significant.

Welch said that the stipend was to be paid until the project was decertified (from the enterprise zone at the end of construction.)

Welch said that decertification from the enterprise zone would happen within five years. Kevin Bateman added to that saying that the agreement was for $50,000 total and that would come regardless of when the decertify process was completed. He noted for example if the city and county were able to regain their enterprise zone land within two years, Mulligan would continue to pay the $10,000 per year until the full obligation was paid.

In somewhat of a sidebar, Bateman added that now that the city understands the decertifying process, he thought it was time to do the same thing with the land designated to the Formosa chemical plant, which is not even in Logan County. When the Formosa plant was destroyed several years ago, the city and county agreed to give them enterprise zone acreage so that the plant could be rebuilt.

Welch said he was in agreement with Bateman, that the city and county need to look into decertifying other designations. There is an application process for decertifying that would have to be followed for each parcel the city and county want to reclaim.

Ron Fleshman asked who would be responsible for the application. Welch said that the city and county would be responsible, but that Baker and Kyle Barry with Mulligan would assist. Welch noted that Barry has experience and knowledge about the process so that would be beneficial.

As the council discussed putting a motion on the April 5th voting agenda, Fleshman said he wasn’t sure the city was ready. He felt there needed to be more details put into writing regarding the agreement with Mulligan, the enterprise zone stipend, the decommissioning process and a proposed intergovernmental agreement between the city and county.
 

Welch had said that the intergovernmental agreement between the city and county would be to secure the decisions made now and outline the actions to be taken for future councils and county boards. He noted that in five years there could be new council or board members who would benefit from an agreement that outlined what was to be done.

Welch responded to Fleshman saying that those details pertained directly to the permit that would be issued to Mulligan. What the city needed to vote on first was the generic ruling that solar farms would be included in the list business and industry types qualified to apply for enterprise zone designation.

Baker spoke up saying that Mulligan is anxious to get started on the project. The company is planning to start construction in April. She said that the sales tax exemption is not retroactive, so if they start in April without the appropriate designation the company will not be able to take full advantage of the tax exemptions when purchasing materials.

March is a five Monday month, which means there will be no city council meeting held next week. Work will continue behind the scenes to get the documentation all in order for the voting session that will come on April 5th.

On April 5th, it is expected that there will be motions to approve adding solar farms to the qualified businesses and industry in the enterprise zone. There should also be motions that pertain directly to the Mulligan Solar Farm.

Aldermen may choose to vote on one or more of the proposed motions, but also have the right to table any action item if they feel they are not fully prepared to make an informed decision.

The Mulligan Solar Farm, which is owned by Apex Clean Energy will be located south of Lincoln on Route 66. The solar panels will be constructed in the vicinity of the new Fogarty Power Station. Baker has indicated that the solar farm will be constructed regardless of the EZ decision. Construction is estimated to take approximately two years.

It should also be noted that adding solar farms to the list of approved business and industry in the enterprise zone does not automatically entitle any farm to claim EZ status. Each farm will have to go through the permit application process with the county and city and be approved by both in order to gain EZ status.

Two other steps would need to be taken. Other Logan County municipalities would also need to sign the approval and then the approved request goes to the state to be approved by a committee that oversees enterprise zones.

Also, according to Baker, solar farms are on the verge of being listed with the state of Illinois as a high-impact industry or business, thus meaning the companies would have exemptions and other benefits without enterprise zone designation.

[Nila Smith]

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