Hill County approves tax abatement for solar farm

Editor: Shannon Cottongame

October 6, 2021

The Hill County Commissioners Court heard comments from the public before approving a tax abatement agreement for a solar farm Tuesday, September 28.


Hill Solar I, a project of Core Solar of Austin, requested a tax abatement on its planned solar energy project in Hill County. Commissioners previously approved a reinvestment zone including 5,607 acres of land north of Hillsboro in the Itasca Independent School District (ISD).


While that zone includes more acreage than is currently being leased from landowners, the company said that the designation would allow flexibility in the design and the ability to enter into future agreements if the project is expanded.

The proposed capital investment by the company is over $448 million, with an estimated minimum taxable value of $340 million.


The agreement provides the company with a county tax abatement of approximately 52 percent over a 10-year period, but the tax break will not apply to the FM lateral portion of the tax rate, which the county never negotiates. This means that the project will immediately put the full amount of expected tax revenue into the county’s road and bridge fund.


With its $448 million capital investment, the company’s abatement percentage will be 70% in the first year and decline until the tenth and final year of the agreement, when the abatement will be 30%. The county is also protected from depreciation of the project, with the cutoff at 20 percent of the company’s investment.


The company is entering into long-term lease agreements with landowners, with solar projects generally expected to last 35 to 40 years.


Commissioners heard from three Hill County residents in favor of the project and one against it during the public hearing.

Two landowners who have signed leases with Hill Solar I told the court that they were pleased with the assurances in their contracts that the company would return the land undamaged to them at the end of their contract periods, allowing them to pass it on to future generations. They told the court that they will still have plenty of acreage for agricultural use while the solar panels are in operation.


Itasca Superintendent Dr. Mark Parsons also spoke to the court. “There’s no doubt that this is a controversial topic, but in my role as superintendent of Itasca ISD, my number one goal is to make decisions that best impact our students,” Parsons said. The superintendent said that the project was in the best interest of the students and community of Itasca and will allow the school to improve its facilities without burdening other taxpayers.


Parsons said that since the district only offers tax abatements on the maintenance and operations side of its overall tax rate, the project could be taxed 100 percent on the interest and sinking (I&S) portion of the rate.


He explained that the tax revenue on a $448 million project could have major impacts for a small school. “It could allow us to create a cafeteria that actually fits all of our kids, finish out some buildings that were never finished or upgrade some facilities without having to dip into the pockets of our taxpayers, and we might even be able to lower the tax rate,” he said.

“There are pros and cons no doubt, but for me as a representative of our community and our district, this is a great opportunity for the citizens of Itasca ISD.”


On the other side of the conversation, Hill County resident John Blaha expressed opposition to the project and encouraged commissioners to vote against the abatement. “As a steward of the land, these projects take valuable farm land and ranch land out of production for a generation,” Blaha said.


He also said that he was concerned about damage to the land and felt that landowners’ heirs will not be interested in returning the land to agricultural use once the leases are up.


Prior to voting in favor of the agreement, commissioners discussed their reasons for supporting it, including the tax revenue, preserving farm land in the county that is increasingly being sold and developed, and giving landowners the freedom to make their own decisions.


The company plans to begin construction in the first part of 2023, with the operation going online during the first half of 2024.


The court also held a public hearing on a proposal to close a portion HCR 4411 in the interest of a landowner in the area. After hearing from another resident who utilizes the road, the court opted not to make the change.


Commissioners approved a new indigent burial policy that took effect October 1. The county has a responsibility to bury or cremate those who die in the county with no family to handle arrangements. Hill County Judge Justin Lewis said that the county is seeing more and more of these cases, and the document outlines the county’s policy more clearly.


The judge said that the vast majority of the bodies that cannot be donated for scientific study are cremated and stored by the county, although there are exceptions if the individual cannot be identified or if there is a religious exemption. In those cases, the bodies must be buried.


The court approved a request from the sheriff’s office to refinance six Chevy Tahoes and two transport vans with American National Leasing Company. This will lower the interest rate from 4.15 percent to 2.75 percent, saving the county over $2,000.


An agreement was approved with Infinity Sound for audiovisual systems in the new Hill County Court at Law courtroom in the courthouse. The company’s proposal was $55,680, which includes all wiring, installation and support.


An engagement letter with Beyer & Company Certified Public Accountants was approved to have the company perform the county’s outside audit for the fiscal year that ended September 30. Judge Lewis said that the county switches auditors every five years because it is good business to have a new set of eyes on the books from time to time, and this is the company’s fourth year providing the service.


Commissioners also approved a new fee schedule for the sheriff’s office and constables in response to the increasing costs associated with performing certain duties, like picking up and boarding stray livestock.


The court approved a proposal for inspection services on the new bridge over Brooken Creek on HCR 3206 at a cost of $7,935.


The commissioners’ next regular meeting will be held Tuesday, October 12, at the Hill County Courthouse.

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