Van Vleck ISD trustees unanimously approved a resolution creating the Lavaca Bay Solar, LLC reinvestment zone and tax value limitation agreement with the same company in a special called meeting, Monday, Dec. 6.
All school board members were present at the meeting.
“We’re all here to do what is best for our students and our district,” said board president Tony Kucera.
The reinvestment zone spans about 24,000 acres south of Cedar Lane and is entirely within the school district’s boundaries.
The resolution was approved after a 30-minute, closed-session discussion.
“In order for the district to form a reinvestment zone, we first have to establish guidelines and criteria for the area,” said VVISD Superintendent John O’Brien.
“These criteria and guidelines spell out what the board can do or expect from businesses interested in the zone,” explained Eddy Perez, district legal counsel.
“This is strictly outlining the criteria for this area and any future zone the board decides to create,” Perez said.
“It’s not binding just to Lavaca Bay Solar and can be renewed every two years and amended as needed.”
Perez told the board that the Lavaca Bay Solar farm project was contingent upon the company getting a 313 agreement.
“This project hinges on the company getting this 313 taxable value limitation agreement,” he said.
A 313 agreement is a limitation of appraised value property for school district maintenance and operations taxes by VVISD that lasts for 10 years.
“We’re definitely still in the design phase of the construction process, but we are very interested in this area,” said Lavaca Bay Solar Project, LLC Agent Doug Coats.
“We’re currently trying to clear some hurdles with our hydrology requirements. We’re working on jumping through those hoops as needed.”
Cedar Lane resident Louis Peter expressed several concerns about what would happen if the company went bankrupt and if the 313 agreement would be transferable.
“I’ve seldom seen a power plant in Texas go bankrupt without someone waiting in the wings to take over the plant and get it back online and generating energy,” answered Coats.
“We’re constantly going to need energy as the state continues to grow, so, I don’t see this being an issue.”
“The 313 agreement will be transferable to whatever company takes over at that point,” added Perez.
“Should a company be found in breach of the agreement, they will be treated as a delinquent tax collector and owe all of their backed taxes in full with interest.”
The agreement also outlines Lavaca Bay Solar as paying $100 per student per the average daily attendance (ADA) across the district.
“That is the maximum payment the tax code allows for,” explained Perez.
“Payments would begin at the end of January 2023.”
The solar farm is projected to generate about $214 million when it comes online and will be taxed at $30 million for 10 years.
There will be one full-time position at the farm upon construction completion.
“While this seems like a low number, it is in fact on par with the industry standard,” added Perez.
“That standard is one employee for a 300-megawatt production plant. So, the company qualifies for a waiver requiring them to generate more permanent jobs.”
“There are no negatives to this agreement for Van Vleck,” said O’Brien.
“These are definitely favorable terms for the school district,” agreed Perez.
“There is significant financial protection for Van Vleck,” he added.
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