Power Plant Tax Plan Tabled

— A tax relief proposal expected to help refurbish the Flint Creek power plant near Gentry was put on hold indefinitely Thursday when Benton County officials were told the agreement had been rejected by the state Department of Finance and Administration.

County Judge Bob Clinard told the Quorum Court the state turned down a memorandum of understanding between the county and the Arkansas Electric Cooperative Corporation to enter into a Payments In Lieu of Tax agreement.

“We received notice this week from AECC that the DF&A turned down their request for a 95 percent abatement,” Clinard said. The agreement essentially exempted the corporation’s share in planned environmental additions to the plant from the county’s property taxes. The corporation would have paid the county about $1.75 million over 32 years in lieu of those taxes.

Southwestern Electric Power and Arkansas Electric Cooperative each own 50 percent of the 528-megawatt coal-fueled plant, according to the company. Southwestern Electric Power operates the facility. As a baseload unit, Flint Creek provides power 24 hours a day. It’s the only baseload power plant in Northwest Arkansas.

To comply with multiple federal regulations, the plant must install controls for sulfur dioxide, nitrogen oxide, mercury and other hazardous air pollutants, according to the company.

The controls include a dry flue gas desulfurization system, commonly known as a scrubber, to reduce sulfur dioxide emission; low nitrogen oxide burners and overfire air to reduce emission; activated carbon injection to reduce mercury emission; and a fabric filter, commonly known as a baghouse, to filter particulate.

According to information from Michael W. Henderson, vice president and chief financial officer for Arkansas Electric Cooperative, the agreement would reduce the cost of the improvements.

Henderson said at an earlier meeting the agreement would allow the county to collect the property taxes it’s receiving now, which is slightly more than $500,000 a year, plus the additional tax on any other additions to the plant.

The environmental work is projected to create 500 construction jobs and 19 permanent jobs. When he met with the county earlier, Henderson also said there is a possibility of the plant being closed if the cost of improvement is too high. Clinard echoed that concern Thursday.

“This is a serious issue for Benton County,” Clinard said. “There are a lot of jobs at stake if they decide to shut that plant down.”

Several justices of the peace questioned the state’s decision to reject the proposal.

“What business is it of DF&A what we do on the collection of property taxes in Benton County?” asked Dan Douglas, justice of the peace. Douglas, who is running unopposed for a seat in the state House of Representatives, promised to look into the issue. Frank Winscott, justice of the peace, asked George Spence, county attorney, to research state law and report back to the justices of the peace on the agency’s authority.

At A Glance

Quorum Court Action

In its other business, justices of the peace approved:

  • Appointing Lezlie Ford to the Equalization Board.
  • Spending $500,000 for asphalt for the Road Department.
  • Spending $6,390 in grant money for the Adult Drug Court program.
  • Spending $20,000 for remodeling work on the old juvenile detention center.

Source: Staff Report

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