A Property Tax Break

A Property Tax Break

November 01, 2012

A property tax break for renewable energy producers in Tennessee is “of doubtful constitutionality,” the state attorney general said in a formal legal opinion in early November.

A state law requires that pollution control equipment be valued at no more than 0.5% of its original cost. In 2010, the state legislature extended the same policy to machinery and equipment used to generate electricity in certified green energy production facilities.

The attorney general said the state constitution requires all property in the state to be taxed in an equal and uniform manner.

The new law will remain on the books unless struck down by a court or changed by the legislature. The head of the state agency responsible for overseeing property tax assessments asked for the opinion. The attorney general said the same thing about the cap on property tax assessments for pollution control equipment 24 years ago.

The state legislature debated repealing the law earlier this year, but backed off after solar companies objected. Repeal may be considered again in 2013.

by Keith Martin