Property Tax Assessment for Commercial Wind Farms

Summary

Pennsylvania enacted legislation in November 2006 providing that wind turbines and related equipment (including towers and foundations) may not be counted by tax assessors when setting property values.* However, the law states that the valuation of real property used for the purpose of wind-energy generation "shall be developed by the county assessor utilizing the income capitalization approach to value." This valuation is determined by the capitalized value of the land-lease agreements, supplemented by a sales comparison data approach as deemed necessary by county assessors. Lessees or lessors must provide relevant, non-proprietary lease and lease-income information to county assessors by September 1 of each year.

In 2010, S.B. 918 consolidated and amended property tax assessment laws in Pennsylvania. The provisions governing the assessment of wind energy facilities were relocated at this time, but not changed in a substantive way. Click here for local tax information from the Pennsylvania Department of Community and Economic Development.


*Although the language of the statute is somewhat unclear on this point, the law is apparently not intended to address property tax assessments of residential scale wind energy systems. With a lack of clear guidance from the state on this issue, assessment methodologies for residential wind systems may vary from county to county.