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Published on January 1st, 2019 | by Steve Hanley


Rooftop Solar Tax Relief Bills Vetoed By Michigan Governor

January 1st, 2019 by  

In most parts of the country, the improvements people make to their homes increase the taxable value of their property. The building permit process has two parts. The first makes sure the proposed improvements comply with all applicable building codes. The second sends the information from the application to the tax assessor so the value can be taxed the next time property tax bills are rendered. But is a rooftop solar system a taxable improvement?

rooftop solar

The answer to that question depends on where you live. Some states say yes, others say no. Even within a state, the rules may vary. That is the case in Michigan where most communities choose to treat rooftop solar systems as personal property that is not subject to real estate taxes. But Ann Arbor, one of the larger cities in Michigan, takes the opposite  view. It treats rooftop solar systems as real estate, claiming state law requires it to do so. Therefore, the value of those systems are taxed by the city.

Ann Arbor residents Mark Clevey and Nancy Fenton filed a lawsuit last year asking the court to declare their rooftop solar system was personal property and not real estate. They lost. According to a report by Michigan Live, tax tribunal judge Steven Lasher agreed with the city, saying residential solar energy systems are not common enough to be considered the type of “customary” personal property exempt from taxation.

To be clear, the judge ruled that if rooftop solar systems were more common, they would be exempt but because they are not more common, they are taxable, even though taking them out of the taxable category would encourage more people to install rooftop solar. “The law is a ass,” Charles Dickens wrote in the 19th century. Things in the legal sphere have not improved all that much since then, apparently.

In 2018, the Michigan legislature stepped in to resolve the issue. It passed two bills — HB 5143 and HB 5680 — that specifically defined rooftop solar systems as personal property. Even the Ann Arbor city council passed a resolution last fall supporting both bills. HB 5143 passed the House 106-3 and the Senate 38-0. HB 5680 passed the House 105-4 and the Senate 38-0. Just before the end of the year, Michigan governor Rick Snyder, the man who has refused to lift a finger to help the citizens of Flint solve their water crisis, vetoed both measures.

“There was no opposition,” says Clevey, who is also vice president of the Great Lakes Renewable Energy Association. “It was a good idea, it was based on merit, and everybody came together and said, ‘This (taxation) is bad for everybody, so let’s get rid of this stupid law.’”

Ostensibly, the governor’s action was based on the fact that the new legislation would set up two classes of rooftop solar owners — those who installed their systems before the law changed and those who did so afterward. This sort of legislative oversight is routinely resolved by the courts, which have ruled consistently that any legislation is presumed to apply retroactively unless the legislature clearly states a different intention.

But Snyder was having none of it. Common sense, logic, and the will of the people be damned. The law is the law is the law and never the twain shall meet, or something like that.

Comments on the Michigan Live story may provide some illumination on this subject. A person calling himself Snide posted, “Almost unanimous support in both chambers by both parties yet he vetoes…. In this case I’d say follow the money……..who will benefit by this not going ahead and check Snyder’s connection to them,” which got this reply, “Fossil fuel companies have Snyder in their pocket.” Perhaps so. Snyder has been obstinately opposed to any proposal that would allow Tesla to sell direct to Michigan residents.

While perusing the comments, I couldn’t help noticing this posting from someone styling himself as SpotOn: “A123 was an alternative energy for cars. How did that work out? Over 500 Billion in subsidies before they went bankrupt.” A free subscription to the CleanTechnica newsletter to the first person who spots the error in that statement. If we could turn idiocy into energy, we could decarbonize the electrical grid overnight. 
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About the Author

Steve writes about the interface between technology and sustainability from his homes in Florida and Connecticut or anywhere else the Singularity may lead him. You can follow him on Twitter but not on any social media platforms run by evil overlords like Facebook.

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