Stoneham County: The Impact of Public Policy on Wind Power Economic Development

Article excerpt

CASE DESCRIPTION

The primary purpose of this case is to explore public policy issues and economic development at the community level. The case can be used to explore the intricacies of complex decision making with respect to cost analysis in the economic development goals of local communities and the tradeoffs of long-term environmental and community relationships. The case has a difficulty level of three. The case can be used in a course on Strategic Policy. The case can be presented and discussed in two to four class periods depending on the number of issues considered. Students can be expected to spend about 10 hours of outside preparation to be fully prepared to complete the case.

CASE SYNOPSIS

As the United States strives toward energy independence, a strategic public policy emphasis on wind energy is growing. The proliferation of wind farms is fueled by a claim that wind power can reliably supply a significant and environmentally benign share of our country's growing demand for electricity. As wind farms have proliferated, however, adverse impacts of wind power are becoming clear to a growing number of citizens.

Georgina Oldman, County Judge for Stoneham County, was excited. She had just received a call from a corporation interested in the construction of wind farms in the county. The proposed 406 wind turbine farm would have a capacity of 650MW. The $750 million project would produce an estimated 10-year abated tax revenue of $15 million. The new revenue would fund badly needed services. The local economy had fallen on hard times over the past 2 decades, so the prospect of growth due to wind farms was seen another "oil boom" to the region. For the county, the call from the Shamrock Energy Inc. LLP was a timely godsend.

Judge Oldman knew that the county would have to establish a reinvestment zone and grant tax abatements. The required public hearing on the project drew a large crowd with speakers both supporting and opposing the project. Some speakers addressed the positive economic impact of the project, such as job creation, increased tax revenues, and economic stimulation. Others addressed the negative effects of wind farm development citing the impact on tourism, lost of aesthetics, noise and environmental concerns, and the potential impact on the air force base. Having become clear that the county commissioners had much to consider, the county staff was directed to develop a cost / benefit study, analyzing both the tangible and intangible aspects to provide a recommendation regarding the project.

STONEHAM COUNTY: THE IMPACT OF PUBLIC POLICY ON WIND POWER ECONOMIC DEVELOPMENT

Georgina Oldman, the County Commissioner Court Judge for Stoneham County was excited. She had just received a telephone call from an Irish-based corporation interested in the construction of wind farms in the county. Apparently, several landowners in the county had signed contracts of intent to lease their land to the corporation. Phases I and II of the wind farm project are expected to house 406 wind turbines for a total of 650MW of installed capacity. The total valuation of the project investment is $750 million; a potential estimated yearly unabated tax revenue of $1.25 million. The prospects for increasing county, independent school districts and water district budgets over the next 20 years would provide additional services that the various government entities had been unable to provide in previous years. Recently, voters in the county had failed to approve the district's $85MM education bonds and the $120MM water/sewer bond project. The county was left with how it would deal with getting by without the funds necessary to provide needed community services. In addition, due to the housing crisis, market values for residential homes had fallen by 18% over the past 2 years. The county could not raise the property tax assessed rate on residential property for 5 years because of mandates and caps placed on residential property tax increases by the State. …