New revenue pact with solar farm pleases Margaretta school officials

GROTON TWP. — A local school district's unhappy experience with the Nexus natural gas pipeline helped lead to a new agreement on obtaining revenue from a planned solar power project in Erie County. The new PILOT — which stands for payment in lieu of taxes — agreement between Erie County and Wheatsborough Solar will provide $640,000-a-year payments for the next 30 years, a total of $19.2 million, to Margaretta Schools — without hurting the district's school funding formula — district superintendent Ed Kurt said. The agreement also ensures that local workers will be hired for the construction of the project — a part of the agreement that was important to Erie County's commissioners — said Matt Old, one of the commissioners. The Wheatsborough Solar project is being built in Groton Township in southern Erie County. It's expected to generate 125 megawatts of power. Construction on the project hasn't gotten very far yet, but that will change soon, said Brian O'Shea, a spokesman for Apex Clean Energy. "Our crews are mobilizing, and there will be a noticeable uptick in activity in the coming weeks and months. We will provide updates on the construction process as it unfolds at wheatsboroughsolar.com/construction," O'Shea said. The solar farm is expected to begin operations in the first quarter of 2025. Last week, the commissioners replaced the property tax revenue the project would have generated with a PILOT agreement. A news release outlining the agreement says that, for 30 years, instead of regular property tax collections, the solar farm will pay the county about $1.1 million a year, with the first $875,000 allocated using the normal property tax formula. In addition, $50,000 a year will go to EHOVE Career Center, and another $50,000 a year will go to an economic development entity chosen by the commissioners. It's likely that entity will be the Greater Sandusky Partnership, Old said. In addition, the PILOT will provide a one-time payment of $150,000 to a local nonprofit chosen by the commissioners. That decision hasn't been made yet, Old said. Margaretta Schools' board and officials had sought the agreement, Old said. Kurt and Diane Keegan, the school district's treasurer, said that the district was supposed to get $8 million a year starting three years ago, in the first year of property tax revenues from the Nexus gas pipeline. Instead, the school district has received payments ranging from 40% to 58% of what was expected. Meanwhile, the valuation of the pipeline has been fought over in court for about three years, Keegan said. The case is currently before the Ohio Supreme Court. What's worse is that state officials, in calculating how much state aid Margaretta's school system will get, included the large Nexus payments the district was supposed to get, Kurt said. Margaretta is being treated as a rich school district, with the resulting reduction in state aid, even though it's not. "They assume we are getting the full payment of NEXUS," Kurt said. "It's really hurt our building project." The new PILOT agreement locks in the solar farm revenues for 30 years with no chance of appeal, allowing Margaretta officials to count on the money and include it in their plans. And the PILOT money won't be included in the school funding formula, Kurt said. The amount of money being paid is close to what would have been paid using property tax collections, spread out over 30 years, Old said. Keegan said that the PILOT payments will begin one year after Wheatsborough begins producing electricity. If that begins in 2025 as scheduled, the payments would begin in 2026. How the school district will spend the money may depend on how the Nexus court case plays out. The district had planned to spend most of the Nexus money for construction of a new school, then use the PILOT money for make up for shortfalls in the Nexus revenue, Keegan said. "We have a lot of moving pieces," she said. "Everything we do is pretty much in limbo waiting on the (Ohio) Supreme Court." O'Shea said Apex is pleased with the PILOT agreement. "We are thankful that Erie County Commissioners passed the PILOT resolution, which will ensure Wheatsborough Solar delivers the maximum benefit to Erie County and the Margaretta School District. Because the PILOT is in place, we anticipate over 100 local workers from Erie County and the surrounding region will be on site during peak construction," he said. Old said that under state law, any PILOT agreement requires that local workers will be used for construction. "They have to use local labor. That was important to me and the other commissioners," Old said. Large national energy companies such as Apex often have crews that travel the country working on projects, Old explained. For example, when the Nexus gas pipeline was built, "Those crews primarily came out of Texas," Old said. In addition, local farmers are getting money from lease payments being made by Nexus. "The land for the Wheatsborough Solar farm is leased from local landowners," said Natasha Montague, a spokeswoman for Apex Clean Energy. "The landowner maintains ownership of the property and retains the ability to exercise their personal property rights. We've established a lease agreement that allows us to utilize the land for the solar farm while providing compensation to the landowner in the form of rent," Montague said.