Individual solar panel owners from a local community solar farm will not have to fill out tax forms for their solar panels despite an earlier call for property taxes to be assessed, according to appraisal officials.
Instead, Clean Energy Collective, the Colorado company that built the project, will be liable for property taxes on the distribution equipment necessary to move power to the grid, officials with the Bexar County Appraisal District (BCAD) said.
“We’re always happy to be able to give good news,” said Chief Appraiser Michael Amezquita, who had previously said he’d prefer not to assess taxes to individual panel owners. “It doesn’t happen very often.”
However, a spokesperson for Clean Energy Collective said the company believes its property also is exempt from property taxes.
Earlier this year, the 244 participants in CPS Energy’s community solar project received tax forms from BCAD, a quasi-state agency that appraises property for taxation to fund local municipalities, school districts, and other government entities.
The move was surprising to some panel owners, who pointed to a state law that exempts personal solar panels from property taxes. Precinct 3 County Commissioner Kevin Wolff was among the local officials who wrote to BCAD saying that Clean Energy Collective, not the individual owners, should receive the tax burden.
In a July 23 letter sent to panel owners, BCAD officials agreed, saying the exemption in state law does, in fact, apply to community solar panels. Amezquita said BCAD staff will “disregard” tax forms it already has received from panel owners.
The issue of how to tax community solar remains relevant, with CPS Energy prepared to contract for another community solar project up to nearly five times larger than the existing one. The municipally owned electric and gas utility is using community solar to expand access for renters and people whose roofs aren’t well-positioned for solar panels.
In 2015, CPS Energy selected Clean Energy Collective, a pioneer in the community solar (also known as roofless solar) business model, to install approximately 11,200 solar panels at the site off of Highway 87 near the intersection of Loop 1604 east of San Antonio.
CPS Energy customers could then purchase panels at the site and receive credits on their utility bills. The panels sold out within the first year.
After meeting with CPS Energy officials, income tax experts, auditors, and staff attorneys, BCAD officials determined the property was not eligible because it only provides a bill credit and has no cash value, among other factors, according to BCAD's letter to participants.
Amezquita said that while the land itself is on the tax rolls, Clean Energy Collective’s property at the site has not yet been assessed. The company does not show up in the Bexar County Tax Assessor-Collector's office's records for entities required to pay property taxes.
“We weren’t aware of it,” Amezquita said when asked about why the company's property was not previously on the tax rolls. He said his appraisal staff met Wednesday to discuss how to assess the value of the company’s property at the site and may "back-assess" for previous years.
In an email Wednesday, Clean Energy Collective's marketing director Kelly Leslie did not confirm whether local tax officials have ever required the company to pay property taxes, though she did say company officials believe the property is exempt.
"At this time, it's CEC’s understanding that the ... equipment at the Bexar County solar energy site is exempt from property tax pursuant to the Texas Tax Code," she said. "CEC is communicating directly with Bexar County regarding this."