Delaware County Council decides to keep tax abatements for solar developers

MUNCIE, Ind. — Delaware County Council decided Tuesday to keep a tax abatement granted to solar energy developers Invenergy and Hawthorn Solar in place as both companies continue to pursue utility-scale solar fields in northern Delaware County.

The two major solar projects remain alive after a new solar ordinance was approved with increased set backs for nonparticipating property owners and a limit of 5,000 acres that can be devoted to such projects in Delaware County.

The council conducted a public hearing Tuesday, in which it asked both companies to provide an update on the status of their planned developments. After representatives of the developers spoke and answered some questions from council members, council voted 5-2 to keep tax abatement for Invenergy's Meadow Forge project in place, with council members Matt Kantz and Ryan Webb voting to abandon tax abatement for a project that has been a divisive issue in the Gaston area.

No vote was taken concerning the planned Hawthorn development, which is smaller and has generated less opposition than Meadow Forge. The abatement for the Hawthorn project simply remains in place without a council vote.

Invenergy began gathering leases for farm ground in Washington Township in 2020, prior to its application for tax abatement in the fall of 2021 to build a solar field stretching from north of Gaston on to the Grant County line. Some farmers who had been approached rejected Invenergy offers to lease their land and said they were surprised in 2021 to learn the project had come together when the project was announced.

Opponents said converting farm fields of some of the most productive ground in the county to acres of solar panels would change the nature of the community in and around Gaston for the worse. Proponents said the lease agreements would provide a guaranteed income for farmers seeking economic security amid the ups and downs of crop farming. Others, including many with connections to Ball State University in Muncie, said the project would serve as a local effort in the battle against climate change by offering more renewable energy.

Both projects would allow energy produced by the panels to hook into electric infrastructure operated by AEP and its subsidiary Indiana Michigan Power. Meadow Forge was to deliver 150 megawatts of power, enough to satisfy the electrical needs of 32,700 homes.

Ben Friedell, executive vice president with National Renewable Energy Corp. of North Carolina and parent of Hawthorn, said its project near Albany would provide 75 to 83 megawatts of electricity when the project in Delaware Township, near the Muncie Dragway, is completed. Hawthorn currently has 700 acres under lease.

Invenergy, at the time of its application for tax abatement, listed 16 landowners with lease agreements. In 2020, Delaware County developed an original solar ordinance designed to facilitate placement of solar fields in the county and provide for regulations regarding their maintenance and decommissioning.

At the time, Brad Bookout, economic development director for the county, said the fact that Delaware County had created an ordinance that laid out rules governing solar farms made it more attractive to developers. But that ordinance would eventually change.

For nearly three years, an ongoing struggle between proponents and opponents of the Meadow Forge project has played out in public meetings involving the the Delaware-Muncie Metropolitan Plan Commission, Wes Del Schools, county commissioners and county council. During that time, a moratorium on solar development was put in place in February 2022 and an effort to draw up a new solar ordinance was launched with Meadow Forge opposition included.

The moratorium was to be a year in length but stretched to nearly two years after the January 2023 death of Metropolitan Plan Director Marta Moody.

More: Two solar farms OK'd for northern Delaware County as rural landscape likely to change

Unlike Hawthorn, Invenergy also entered into an economic development agreement with county commissioners that would deliver $200,000 each year to the commissioner's office for 10 years.

The agreement was discussed Tuesday by Matthew Muller, Meadow Forge project manager for Invenergy. Council member Bill Hughes pointed out to Muller that if the assessed value of the property involved in the project is above $8,000 per acre, the payment to commissioners decreases by a compensating amount.

The assessed value of the land, which is set by the state, was more than $14,000 an acre in 2023, Hughes said.

Muller referred questions to Baker Tilly, financial advisors used by Invenergy on the project.

As the Star Press reported in January, council members initially thought language in the Meadow Forge economic development agreement called for the county to pay up to $5 million to Invenergy should the county withdraw its tax abatement for the project. Muller clarified that the council is only required to provide Invenergy any economic development payments it provided with a tax credit if tax abatement is withdrawn, not $5 million.

Invenergy, through its attorney, has maintained that the county can't legally withdraw from the economic development agreement or withdraw its tax abatement.

More: Marta Moody, longtime local planner and public servant, dies

Friedell said that Hawthorn, for its part, only sought tax abatement when it knew it had a prospective development in Delaware County and it was needed. He told the council that his industry was a highly competitive one.

"It isn't that we were looking in any way, shape or form for icing on the cake," he said of the county's tax abatement.

He also said Hawthorn was working with county officials regarding the implementation of provisions of the new solar ordinance.

Muller said that engineers for Invenergy are still working on the physical dimensions of Meadow Forge, but it appears that project would be in the range of 1,000 to 1,100 acres when completed.

"Obviously, it's going to be more spread out now," he said, due to bigger setbacks required in the latest solar ordinance.

Invenergy plans to apply for a zoning special use under the solar ordinance yet this year, according to Muller.

When the time came to vote on the measure to rescind, Kantz said, he was torn on multiple levels, with many people he trusts adamant that the abatement should never have come into play for the projects.

"I realize why that investment looked enticing at the time," he said.

Going forward, the council should do a better job reviewing abatement, Kantz said, with a lot of unknown factors still persisting with the solar developments.

More: Economic development agreement with solar developer says county owes if abatement canceled

"Do I think Hawthorn is going to sue us: Maybe, maybe not." he said of rescinding the abatements. "Do I think Meadow Forge will. Probably, they will. That has been their position from the get-go."

He said the impacts of these developments on the county were still unknown, but, "most likely," the developments will disappear from Delaware County in another 25 years.

Hughes said that, in the end, the financial benefit of the projects wasn't so much of an issue for the county. It was, however, an important land use issue and he was glad the solar ordinance now requires developers to request a special use rather than having solar projects automatically allowable.

Webb said he understands that no local government in Indiana has ever rescinded tax abatement before and it's "scary" with the developers having lawyers ready to go into action.

"I feel like sometimes we may fold our hand out of the threat of litigation," Webb said. "I don't really like doing things that way. I feel like if you have the winning hand and you're in the right, then stand your ground."

More: Solar vs. grain: Farm feud in Washington Township roils community, ends friendships

Council member Eugene Whitehead said he thinks the council in 2021 made a "poor decision" in approving the abatements, but he would not vote to rescind because he did not want to send a message to other employers who might choose to avoid Delaware County out of fear any abatement they might be granted might be taken away.

"We don't need to be turning away any jobs," he said.

Council member Jim Mochal also said he did not want to lose farm ground to solar development but, like Whitehead, feared the message it would send to people who might wish to seek tax abatement for other development in the future.

With the abatements question settled, future local government action regarding the solar projects now moves to zoning action.

David Penticuff is a reporter with The Star Press. He can be contacted at dpenticuff@gannett.com.

This article originally appeared on Muncie Star Press: By a 5-2 vote, county council keeps abatements for solar developments