The Gilliam County Court adopted the proposed Rural Renewable Energy Development (RRED) zone in its session on January 6th. The special enterprise zone will establish incentives for renewable energy projects in Gilliam County worth up to $250 million. The RRED zone designation is good for 10 years.
A push to create the RRED zone came from Avangrid Renewables, a subsidiary of Iberdrola – one of the largest renewable energy companies in the world. Headquartered in Spain, the company has a net worth of $148 Billion.
Avangrid gave a presentation to the Gilliam County Court on November 17, saying that the RRED Zone was necessary to continue with the approved Montague Solar and Oregon Trail Solar projects on Shutler Flat.
The RRED Zone will exempt the projects’ builder, Avangrid Renewables, from paying property taxes to the county for at least three years. The company can apply for an additional two years of tax abatement with a maximum five-year exemption from paying property taxes to the county.
In the January 6th session of the Gilliam County Court, Commissioners Sherrie Wilkins and Pat Shannon voted in favor of the RRED designation but Gilliam County Judge Elizabeth Farrar-Campbell voted in opposition.
Judge Farrar-Campbell told the Times-Journal that “The RRED Zone is designed to incentivize investments that wouldn’t otherwise occur. Every indication is that Avangrid will be building Montague 2 regardless as they have already invested millions in permitting the project, lined up construction logistics, and even sold the energy to PGE. I could not, in good conscience, vote to strip our local taxing districts of millions of dollars of critical resources simply to improve Avangrid’s bottom line on the project.”
The RRED Zone designation has a cap of $250 million for development in the enterprise zone and is good for ten years. The two solar projects that are to be built by Avangrid will likely exceed $250 million of investment. Should another renewable energy project want to utilize the RRED zone in Gilliam County, the court would have to work with Business Oregon to extend the RRED zone designation.
Advocates for the solar projects pushed the county to adopt the RRED zone in a public meeting on December 17. Brian Walsh with Avangrid Renewables told participants that several states have created incentives to bring renewable energy projects to rural areas. Walsh said that there would be an immediate impact for the county as 250 construction workers would be in the area for the buildout of the solar projects. Walsh also pointed to the funds spent locally during the Montague Wind project in 2017 and said local businesses would once again benefit from the project.
Despite not paying property taxes for at least three years, the company would ultimately pay more than $20 million in taxes to the county over the lifetime of the project.
Still, the designation will keep much needed funds from reaching special districts in Gilliam County for 3 to 5 years. The South Gilliam County Health District would have received approximately $150,000 a year from taxes paid to the county by Avangrid. The North and South Cemetery Districts would have received approximately $25,000 a year.
Advocates say that three to five years of tax abatement is a small price to pay for a project that will ultimately pay approximately $1.5 million a year for 20 years.