Data supporting Tax Calculations
Assumptions
| $650 | Annual Lease rate/ acre (net income) |
| 7% | Capitalization rate |
| $11,000 | Tangible Personal Property / solar farm acre • Above ground transmission power lines/wires/poles and related equipment • AC switchgears, Meters, Breakers, Control Switches, Regulators • AC Above Ground & Underground Cables & Connectors • Security Systems,Communication Equipment • Computer systems, monitor & control systems and SCADA systems |
Mason County KY’s 2020 average property tax per farmland acre
| Total Acres | 158,080 |
| Total acres considered farmland | 150,712 |
| Total annual Property Tax from farmland | $1,289,962 |
| Average Tax from a farmland acre (Total Tax from farmland / acres considered farmland) | $8.56 |
Calculating Property tax due on Mason County Solar Acre
First determine valuation of solar farm’s real property (land)
Valuation of a utility-scale solar acre is determine based on the income approach.
- The income approach is a real estate valuation method that uses the income the property generates to estimate fair value.
- It’s calculated by dividing the net operating income by the capitalization rate.
- 650 / 0.07 = $9,285.71
Next we calculate amount due each tax district annually
| Tax District | Tax rate / $100 | Amount Due / Acre |
| Real Property (Land) | ||
| School Board | 0.4560 | $50.70 |
| County | ||
| State | ||
| Health | ||
| Library | ||
| Extension | ||
| Tangible Personal | ||
| County | ||
| State |
| Annual Lease rate (net income) | $650 |
| Capitalization rate | 7% |
| Income approach valuation | $9,285.71 |
| Average Tax from a farmland acre (Total Tax from farmland / acres considered farmland) | $8.56 |
| Typical local tax and fees paid by an acre of Solar | $240 |
| Expected minimum life of Utility-Scale Solar System | 30 Years |