Commissioners approve abatement for expansion of Hill County solar project

Editor: Shannon Cottongame

June 23, 2022

The Hill County Commissioners Court approved a tax abatement agreement for the expansion of a solar project within an existing reinvestment zone Tuesday, June 14.

In April, the court voted to propose a tax abatement agreement with Hill Solar II, LLC, which will be an expansion of the Hill Solar I project located in Itasca Independent School District’s boundaries.

Last year, the court granted a tax abatement to Hill Solar I, a project of Core Solar of Austin, after approving a reinvestment zone of 5,607 acres located north of Hillsboro in Itasca ISD. The creation of a reinvestment zone allows the county to negotiate tax abatement agreements in the designated area.

At that time, the company said that the acreage would allow flexibility in the design and the ability to enter into future agreements if the project is expanded. The company has now leased additional land for its storage and transmission needs in the previously approved reinvestment zone.

Property within the zone is being leased from landowners based on the needs and configuration of the project.

This next phase involves the installation of facilities and equipment for the operation of a maximum 200 MWac solar electric generating system and transmission equipment and lines.

The company’s capital investment for phase two of the project is estimated to be over $200 million, with the estimated taxable value listed at a minimum of $150 million to $200 million.

In April, commissioners updated the county’s green energy guidelines to reduce the tax breaks offered to solar and wind energy companies by 20 percent. But Mike Dixon, the county’s economic development counsel, told the court that the new guidelines will not apply to Hill Solar II since it is located in a reinvestment zone that was created under the old policy.

Under the old guidelines, an investment of over $200 million qualifies the company for a tax break of about 52 percent over a 10-year period. That does not apply to FM lateral taxes, which fund road and bridge work, and the agreement includes a requirement that the company repair any road damage caused by construction.

The court also approved the issuance and sale of the Hill County Tax Note, Series 2022.

Commissioners have been working with Ben Rosenberg of U.S. Capital Advisors on the county’s options for obtaining additional funding for the multiple capital projects currently underway with grant funds.

The county has been able to expedite multiple projects due to grant money received, including American Rescue Plan funds. Some of the ongoing and recent projects include radio system upgrades, the Covington Street annex remodeling project, new Texas A&M AgriLife Extension Office building, pens for estray livestock at the sheriff’s office and the new Precinct 1 annex in Huron.

The county is putting a little over $9 million into the projects, but County Judge Justin Lewis estimated that another $1.75 million to $2 million will be needed to complete them.

U.S. Capital Advisors submitted a proposal to 50 to 75 banks regarding lending the county money with bids due last week. Rosenberg said that two good bids were received, and after figuring in all fees, Amegy Bank had the best offer. The court voted to accept the bid.

In other action, the court approved adding HCR 2134, also known as Big Jim’s Road in Whitney, to the Hill County Road Maintenance Map.

Commissioner Larry Crumpton said that the road is heavily used by drivers traveling between Farm Road 933 and Highway 22, and while it has been maintained by the county, it is not on the road maintenance map.

An agreement was also approved between Hill County Emergency Services District (ESD) 2 and Hill County. The district recently purchased automated external defibrillators (AEDs) for the county’s four constables and emergency management coordinator.

The agreement is the same as the previous agreement that covered the units purchased for sheriff’s office patrol vehicles and ensures that the AEDs will be maintained by the county and required training will be completed.

The court’s next regularly scheduled meeting will be held Tuesday, June 28.

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