Two associations representing power companies statewide are suing Riverside County, alleging ais an illegal tax, it was announced today.
"In order for California to meet its renewable energy objectives and take real strides toward energy independence, the solar industry needs to be nurtured, not attacked by illegal county policies," said Jan Smutny-Jones, executive director of the Independent Energy Producers Association.
The IEP and the Large-scale Solar Association, both Northern California-based, filed suit in the desert branch of Riverside County Superior Court on Friday, asking that Board of Supervisors' policy B-29 be invalidated.
requires that any solar power company -- with the exception of those producing 20 megawatts or less -- pay an annual $450 per-acre fee for access to public rights-of-way and for altering desert landscapes.
The fee, which critics call a "sun tax," was unanimously approved by the board despite resistance from solar industry representatives and an avalanche of criticism by union interests and some community leaders, who argued it would scare away prospective projects.
"The sun tax not only discourages the development of solar energy projects in Riverside County, it does so by violating the California Constitution," LSA Executive Director Shannon Eddy said.
County officials would not reply directly to the allegations. But in an email to City News Service, Executive Office spokesman Ray Smith said the county "stands behind board policy B-29 and will decide how to proceed after we have been fully briefed by counsel."
According to the IEP and LSA, the county's per-acre fee on solar companies requires voter approval because the fee, in fact, amounts to a tax, and under Proposition 26, all taxes must pass muster with voters.
Proposition 26, the "Stop Hidden Taxes" initiative, was approved on Nov 2, 2010.
The plaintiffs also allege the imposition of the fee violates the state Mitigation Fee Act of 1987, which permits local agencies to charge developers a fee for the use of public services. However, according to the law, the fee must compensate for a specific project impact, and it must be reasonable.
If neither of those standards is clearly met, the fee can be declared a special tax, requiring voter approval.
"The money raised (from B-29) would go directly to the (county's) general fund rather than to mitigating any alleged impact," Eddy said. "This is a sun tax, not a development fee."
The associations further argue that the county is trying to override the state's property tax exemptions provided to renewable energy producers by enacting per-acre fees.
"This is a straightforward case challenging the constitutionality of a county action," Smutny-Jones said. "At this critical moment for the future of Riverside County's solar industry, we need to do all we can to protect jobs, economic growth and an industry that represents the region's future. This is no time for additional and illegal burdens that will drive projects and jobs out of Riverside County for good."
The county Transportation and Land Management Agency originally proposed a $640 per-acre fee, while industry interests countered that a $140 assessment would be all they could afford.
Around 20 solar projects are in the works, planned within a 118,000-acre area extending east from Desert Center to Blythe.
County officials noted that photovoltaic projects will consume space that might otherwise be used for farming, recreation and housing.
The policy offers the following incentives to companies:
-- $1,500 annual rebates for each person hired locally for project construction, and $2,500 annual rebates for permanent hires;
-- 5 percent reduction on a base payment for tapping existing transmission lines to cut down on blighting; and
-- 10 percent credit for projects that start before Dec. 31, 2014.
Riverside County is at the epicenter of a solar power bonanza, mainly because of the state's mandate that one-third of all electricity generated in California come from renewable sources by 2020.