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Favorable Tax Decision on Solar Array

In December the Michigan Tax Tribunal ruled that a ground-mounded solar array is personal property and not real property for local taxing purposes. The 147 kW photovoltaic electric generating facility in question, built by Helios Solar, LLC of Kalamazoo and owned by Kalamazoo Solar, LLC, sells electricity to Consumers Energy under its feed-in tariff program. The local township had been taxing it as real property, with a true cash value assessment of over $1 Million. The ruling that it had to be taxed as personal and not real property overcame the common law argument that the solar array could be deemed real property since it was affixed to the land. The authority for the decision was founded, in part, on tax exemption provisions of the Next Energy Authority Act (2002 PA 593).

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About this Author

Bruce Goodman, Varnum, Environmental Construction Attorney, Electric Power Negotiations Lawyer

Bruce Goodman practices energy law, environmental law, and construction law. His environmental expertise includes air quality permitting work, compliance counseling on air emissions, state and federal enforcement defense issues, and environmental management program development. His energy expertise includes negotiating numerous electric power sales agreements (both for wholesale sellers of energy and for retail consumers of energy) state electric rate cases, developing municipal energy tariffs, and energy project structuring and permitting. He regularly posts to his blog...