Proposed lease agreements for solar farms sent in recent weeks to farmers throughout the state have resulted in enough confusion that Cornell Cooperative Extension is getting involved.
The lease agreements, which arrived at farmers’ doors apparently in ready-to-sign format — complete with information about the targeted farms and owners — contain around 20 pages of clauses and terms, some of which have raised questions from local farmers, said David Holck, director of the Farm Service Agency in Greenwich.
That office of the FSA covers Washington, Warren and Saratoga counties, and Holck said he’d heard from farmers about the agreements and saw enough of the proposed lease terms to wonder about potential pitfalls.
Cornell Cooperative Extension has also received inquiries, enough to prompt the scheduling of workshops for farmers throughout the region, including one at the Washington County Annex building on Lower Main Street in Hudson Falls.
That workshop, titled “Don’t Get Shocked,” is slated for 7 to 9 p.m. April 21. Other workshops have been scheduled for the same date in Troy, Voorheesville, Hudson and Acra.
Barbara Boggia, who owns a 60-acre farm in Chestertown, was among those who received proposed lease agreements in the mail. She said she knows four other farmers who have also gotten them.
“I’m not saying it’s a bad thing, but I don’t think people understand what it is they’re getting into,” Boggia said.
One of the clauses in the proposed agreement that concerned her most related to the length of the lease agreement — up to 40 years, if the company, Cypress Creek Renewables, exercises a 20-year extension option outlined within the document.
Another clause that caught Boggia’s eye gives Cypress Creek the right of first refusal to purchase all of her land — not just the portion used for the solar farm — in the event she wants to sell.
“I have three daughters, and I don’t want to leave them with a mess,” Boggia said. “Suppose I want to sell it cheaply to my daughter.”
Based in California, but with offices in five other states, including New York, Cypress Creek is a privately held company that was launched about two years ago, according to spokesman Jeff McKay. He said the company is interested in establishing solar energy arrays — around 2 megawatts each, with each needing around 20 acres of land — anywhere such facilities make sense.
“Our goal is to put as much solar in the ground as possible, assuming that it meets our criteria,” McKay said. “We’re still in the early stages of exploring opportunities (in the Warren, Washington and Saratoga counties area), but ideally, we are looking to expand as much as we can.”
Cypress Creek has solar energy projects either up and running or in progress in 14 states, McKay said. And the company expects to have solar arrays functioning “in every utility load distribution zone in New York by the end of 2017.”
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The most viable land options will be those with good, unused, relatively flat farmland that is close to electrical substations or major power lines, for easy delivery of solar-generated electricity to the power grid, he said.
It’s that last criteria that upset Merle Nichols, who owns a farm on county Route 43 in Argyle.
He also received a proposed lease agreement from Cypress Creek, so he hired a lawyer to look it over, at cost of around $1,000, he said.
“We got the brochure, and they told us we would get $1,500 an acre, and we qualified for 21 acres,” Nichols said.
But after letting Cypress Creek know he was interested in the proposed lease, the company informed him his property wasn’t close enough to a substation or a major power line to qualify for a solar farm, Nichols said.
McKay refused to disclose how many proposed lease agreements were sent to farmers in the region, citing competitive reasons.
Cornell Cooperative Extension, via Holck at the Farm Service Agency, shared some potential lease issues for solar farms that will be addressed during the upcoming workshop in Hudson Falls.
Among the potential pitfalls are the impact of lease agreements on farm-related property tax exemptions and possible increases in property assessments — and therefore taxes — related to a solar farm being built on former farmland.
The Cypress Creek proposed lease agreement includes a clause that calls on the company to pay for all property taxes related to the portion of the property used for the solar farm, but a farmer could still see an increased assessment for the rest of his or her property, as a result of the energy generation project.
Such lease agreements could also hinder farmers’ use of their farms or allow the solar energy company to remove structures or objects that obscure sunlight exposure on the part of the land used for the installation, Cornell Cooperative Extension warns.
Boggia, who owns the Chestertown farm, said she also took the lease agreement to a local lawyer, but he said he’d had so many inquiries regarding the documents, he was considering not dealing with the issue further. Boggia did not wish to disclose the lawyer’s name.
“There’s a clause in there that seems to say that, except for the tenants, the parties agree not to get a Realtor involved,” Boggia added. “It seems like a very one-sided lease, and there are other things in the lease that I do not understand.”