Paul Lovell.

In a recent case study on the economic impact of wind energy in Howard County, I had the opportunity to work with the Center for Rural Affairs (CFRA). The full report is written by Alex Delworth, Senior Policy Associate, and is available on the CFRA’s website. To collect information for the case study, we interviewed farmers, a county supervisor, the county engineer, county auditor, county Farm Bureau president, and school superintendents.

Howard County, Iowa, saw its first wind farm in 2008. Today Howard County has 147 wind turbines with a total capacity of 244 Megawatts. This amount of energy powers approximately 50,000 homes! The total taxable valuation of the turbines is a little over $115 million. The tax revenue collected this past year from wind turbines was $2.7 million. This represents 14.5% of the county tax revenue.

Howard County is a rural county with a small population that has limited commercial development projects. Prior to the wind projects, Howard County had been forced to abandon bridges and roads. The Secondary Roads Department was only able to replace one or two bridges a year due to limited budgets. Pat Murray, Howard County Supervisor stated, “I don’t know how other small counties make it without wind turbines; the population isn’t growing much, there isn’t new development, the tax base has been stagnant.”

Howard County has used Tax Increment Financing (TIF), which is a public financing method that uses future property tax increase due to the new wind turbine, to pay bonds issued for infrastructure projects. Since 2010, through TIF, in addition to the one or two bridges replaced per year, Howard County has replaced 30 additional bridges, paved 20 additional miles, and paid a portion of six motor graders, a tractor, and a dump truck. TIF funds have also been used to fund several of Howard County Conservation Board’s recreation and conservation projects, including the Bonair Shooting Range, Lake Hendricks watershed improvements, Mill Pond dam renovations at Vernon Springs Park, renovation of Taylor’s Pond, and bike trails.

Howard County does not use TIF on all the wind turbines. Some turbines are taxed under the standard approach, and funds are available in the general budget. The wind turbines add to the property value of the taxing districts in the county. School districts in the county benefit from the higher value by reducing the total general levy rate for local taxpayers. Out of 334 school districts in Iowa, Riceville Community Schools have the third lowest school tax rate in the state.

Farmers also directly benefit economically. Considering volatile commodity prices and weather, wind turbines can produce a reliable and steady source of income. Wind energy developers pay landowners a fee per acre to secure certain rights through easements on the property. These can be in the range of $10 – $20/acre per year. If the company determines that an area is suitable for a wind turbine, the payment can be $10,000 – $15,000 per year depending on the company and the size of the wind turbine. Landowners also get compensated for any land lost to access roads, which are built for the construction, service, and maintenance of the wind turbines. These payments can provide a significant boost to farmers’ income and be quite lucrative. This money, which is “captured” locally, is then often spent locally which strengthens the local economy. According to Neil Shaffer, president of Howard County Farm Bureau, he has seen farmers reinvest that money into their land, buy new farm equipment, and build new buildings and homes. One farmer we interviewed, who currently has five wind turbines on his property, stated if he knew a 80-acre field could host a wind turbine, he’d buy it in a heartbeat because it would dramatically shorten the time required to pay off the loan.

A Path Forward: Linn County

I recently met with John Zakrasek from the Linn Clean Energy District (LCED) to discuss their process in developing renewable energy ordinances for Linn County. With the shutdown of the 690-Megawatt Duane Arnold Energy Center nuclear plant, a vacuum for new electric generation was created. Proposals to develop utility-scale solar farms soon followed, and Linn County experienced highly emotional public hearings. Accurate and inaccurate information was brought forward in these meetings which ran up to 6 hours. Security was present because of fears of possible violence.

As a solution to calm down the tense situation, the Linn Clean Energy District, working with the Linn County Planning and Zoning staff, created a solar farm fact-finding task force to forge a productive path forward. The 16-member task force was made up of a diverse group of supporting and opposing influential community members, community leaders, county supervisors, and staff. The purpose was to use direct personal observation at three solar farms; one that had been in operation for five years, one that was just built, and one under construction. The task force toured the sites together, and everyone was given the opportunity to ask questions. These observations were documented, approved, and published online by consensus to counter inaccurate information. The task force then developed a set of recommendations based on the 2013 Linn County Comprehensive Plan. This plan provided guidance on the proposed ordinances based on the categories of the plan: Livable Communities, Economic Development and Opportunities, Resource Protection, Sustainable Development, Hazard Planning, and Transportation. A scorecard for commercial solar projects was then developed to determine if a project was to be approved. The scorecard balances the interests of the community, landowners, developers, adjacent landowners, and affected tenant farmers. A minimum score is required for approval of a project.

As Tama County reviews and rewrites renewable energy ordinances, CEDI wants to encourage county leaders to consider forming a task force, much like Linn County. This will allow the development of ordinances that consider the interests of all residents and stakeholders, which will produce a stronger Tama County. The responsible development of renewable energy projects can provide more tax revenue to fund public infrastructure projects and reduce school tax levies, diversify farm income, and keep more energy dollars in Tama County to be spent locally and benefit county businesses.

Paul Lovell is executive director of the non-profit organization Howard County Energy District (HCED); he is also renewable energy siting program manager for the Clean Energy Districts of Iowa (CEDI). Lovell grew up on the family farm near Morrison and is a proud graduate of Reinbeck High School. The Howard County case study he refers to in this column can be found here: https://www.cfra.org/publications/case-study-direct-impact-wind-energy-development-howard-county-iowa.