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| Kevin Jourdain tries to play the King and looks like a Fool |
(Pilot stands for Payment In Lieu Of Taxes)
Jourdain dug hard into the agreements trying to make apples-to-oranges comparisons, but Brian Beauregard, Superintendent of HG&E's Electric Division, did a good job clearing up Jourdain's stupidity. Beauregard's explanations were very technical and sometimes hard to follow. The simple version is that Holyoke gets lower PILOTs because our electric rates are the lowest in the State. If Councilor Jourdain wants more money from PILOTs the ratepayers will have to pay more.
Of course it's more complicated than that. Not all communities meter solar providers the same way. Holyoke is a closed community with its own municipal utility. We pay solar providers a wholesale rate. Communities in the open market pay solar providers at the retail rate. Up to 3 times Holyoke's wholesale rate set by HG&E.
Property tax on solar installations is another factor. These large installations are taxed at the industrial rate no matter what the existing zoning on the parcel, and since Holyoke has one of the highest industrial rates in the State that also makes our PILOTs a little lower.
We're certainly not getting ripped off. The electric ratepayers are getting a good deal. These solar installations save us a ton on peak summer days when HG&E needs to import power at a premium. We're also getting increased tax revenue from the industrial tax rate, and we're getting PILOTs on top of that.
Despite this Councilor Jourdain made it clear he expects to get the exact same payments as other communities. He pretended to not know how these work when he asked for an "inflationary factor" tied to the PILOT agreement. He also asked that they include "decommissioning surety bonds" while making the comment: "All of a sudden they stop operating and I've got this giant thing that looks like something on the surface of Mars and all the neighbors are walkin by it, lookin at it, and nobody's using it, hmmm, I might want that to go away."
Despite his dumb comments Jourdain is well aware the City Council can create any type of bonding requirements they wish. He hasn't proposed any as ordinances for them because he likes to say he's business friendly while shifting the anti-business image to the mayor's economic team. If he really wants bonding requirements for deals created by the office of Economic Development and HG&E then he should create an ordinance to do that, instead of playing games.
Councilor Jourdain continued with his deal-killing rhetoric by asking for a processing fee be tied to the PILOTs noting that other communities had received a $5000.00 fee to originate the agreement. Again, those communities probably have these fees because they have smaller town governments without municipal utilities and may need to hire outside legal to help negotiate the deal.
Brian Beauregard said if the city cranks up the PILOT rate these projects will not get built. Jourdain's response to that was: "You assume like... The baseline assumption is like this is all wonderful.. And now it's just a question of how good can we make it for them. Maybe the deal is we walk away from the deal - Maybe the economics of it don't work."
Beauregard was somewhat taken aback by Jourdain's position. During the back-and-forth Jourdain made increasingly absurd assumptions about how electrical transmission works. Jourdain used his own confusion to come to the conclusion that: "There's been very little due diligence on the city's part to examine other agreements in other communities" even though Brian Beauregard said minutes earlier that HG&E advised some of these communities on their PILOT agreements.
Attorney Toby Wilson for SHR Energy jumped in towards the end to try and move the process forward. He asked Councilors to forward any further questions to his email, and he would get them to the right person. He also reminded them that they covered all the aspects of PILOTs during a finance committee meeting in April 2013 attended by Councilor Jourdain. It was at the April 2013 meeting they set the current PILOT rate that Jourdain said he now couldn't accept.
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| Brian Beauregard, Superintendent of HG&E's Electric Division, talks with students about Solar Power |
Some interesting facts that came out of the meeting:
Holyoke currently has 6.5 megawatts of solar. That's less than 2% of our supply, but on a peak summer day it comes up to 8%.
With the addition of these new solar installations we are getting close to being one of the few Carbon Neutral cities in the nation. A potential draw for companies that want to brand themselves as such.
Video of the 3/8/16 Ordinance Committee meeting can be viewed on this website.
