Wind farm tax break takes toll on neighbors

Columbia County will lose projected sales tax revenue that had been anticipated from the Tucannon River Wind Farm because of a state budget bill granting sales and use tax exemptions to wind energy.

With the sales tax exemption, Columbia County stands to lose tax revenue.

Whitman County officials say this county will not be affected.

Columbia County Treasurer Audrey McLean said the county commissioners planned on getting revenue that was on construction of the newest wind farm.

She said the Tucannon Wind Farm has more than 100 wind turbines, about double what Whitman County’s Naff Ridge wind farm has.

She said not getting that sales tax hurts a small county such as Columbia.

Gov. Jay Inslee approved the bill June 30, about a week before his trip to the Naff Ridge Wind Farm in Whitman County when he praised the entrepreneurship of the project.

The bill extended the sales and use tax exemption which was set to expire July 1 until Jan. 1, 2020.

Kim Schmanke, Communications Director with the state Department of Revenue, said the bill did extend the refund.

“The bill provides, through Dec. 31, 2019, a 75 percent refund of state and local sales tax paid on qualified renewable energy equipment used to generate electricity, including wind turbines, and the labor charges to install the equipment,” she said via e-mail.

“How this works is, the county would receive 100 percent of the applicable sales tax on the total project. Then the wind farm company applies to the department for a refund of 75 percent of the sales tax paid on ‘qualified machinery and equipment’ and labor charges to install the equipment.

“It’s important to note that not all aspects of the project qualify for the refund, just the installation labor and qualified machinery and equipment, “ she added.

“The 75 percent refund comes from both the state and local share of the sales tax collected and remitted to the state Department of Revenue by the county. There is an impact on the county’s distributions from the department when the refunds are paid. We do our best to give the jurisdiction as much advance notice of an impending refund when it’s likely to have a significant impact on the distribution back to the county,” she said.

According to Whitman County Treasurer Bob Lothspeich, the county will receive no more sales tax since construction is done on the Naff Ridge project.

The county will receive $12 million over the next 20 years in property tax revenue, about $700,000 a year.

Lothspeich said the county received $1.2 million in sales tax through February 2012 that was generated by the wind farm construction.

“It won’t touch us because it’s done,” he said.

“Any sales tax would have to come from Avista for electricity generated,” he said.