HomeMy WebLinkAboutCity Council Resolution 2043 tESOI/3TICN NO. 2043
t~ATIVE TO THE STATE OF CALIFORNIA SOLAR ENERGY TAX CREDITS
WHEREAS, Unlike some government programs that actually HINDER the
development of new energy facilities, the solar tax credits have been inmensely
successful in STIMDIATING new energy production, and
WHEREAS, Solar tax credits do not increase GOVE~ bureaucracy.
They increase PRIVATE investment and private sector jobs, and
W~, The solar tax credits have a HIGHLY LEVERAGED impact on
economic activity.
TO WIT, $85 million in direct state expenditures might produce about 4,000
jobs (at $21,250 per job), $85 million in solar tax credits creates about 20,000
jobs (according to a 1982 st~.te government survey). That' s FIVE times as many
jobs per dollar.
Moreover, when a state dollar is spent, it is only after about SIX private
dollars have already been spent. (The current state tax credit in most cases
is just 15 percent of the cost of the solar energy equipment.), and
WHERFa%S, The solar and wind tax credits do not merely aid an ESTABLISHED
industry by boosting its profits. Rather, the tax credits determine whether the
renewable energy industry can exist at current levels of activity!
This is because the tax credits provide the margin that makes solar and
wind energy competitive with energy from oil, gas and nuclear plants (which
themselves receive many tax benefits and subsidies). Without this margin, the
conpetitive scales are tipped against solar and wind energy and the market
virtually disappears, and
WHEREAS, There's FAR MDRE AT STAKE than $85 million in this year' s
budget.
The private sector and the state have already invested more than $1 billion
in making California the nation's leading producer of benewable energy. This
investment will bring enoraDus future benefits to California in greater employment,
increased energy supplies, more stable energy costs and increased tax revenues --
IF the seeds that have been planted are allowed to bear fruit.
To kill these budding industries today ~Duld be penny wise and pound foolish,
WHEREAS, the net cost to the state is far less than $85 million.
This is because the business activities generated by the solar and wind tax credits
produce individual and corporate income tax revenues, sales tax revenues
and even property tax revenues. (A wind farm, for example, significantly
/ncreases the assessed value of barren land. )
MDreover, if the solar and wind energy tax credits are eliminated,
state revenues will not autc~atically increase by $85 million because
many investors will shift to other, less productive tax shelters--and
unemplo~t cc~9efsation costs will rise, and
WHEREAS, California' s reputation as a state with a stable and
attractive business climate will be damaged by a shutdown of the solar
and wind energy industries.
California is well known as a breeding ground for high technology
"sunrise" industries--aerospace, electronics and renewable energy. Though
other states now offer. larger solar tax credits (our solar tax credit
in fact ranks fourteenth in the nation), we have attracted more renewable
energy businesses than any other state because of the size of our market.
WHEREAS, the most promising of all new energy technologies
is direct oonversion of sunlight into electricity by photovoltaic cells.
Production of photovoltaic [ower systems will be multi-billion industry
by the end of the century, rivaling electronics. The Japanese goverrment
has invested vast suns in an effort to make Japan the werld leader in
photovoltaics. California-based ccepanies have the potential to compete
with Japan--if we don't destroy our dcmestic market, and
WHEREAS, n~rous state and local agencies have contracted
for, or invited bids on, large solar energy systems that will be 100
percent privately financed. These public agencies include schools, hospitals
and correctional facilities. The solar energy systems will save these
agencies--and therefore the taxpayers--millions of dollars in future
energy costs without recp~ring any capital investment by the state. But
all these projects will be canceled if the solar tax credit is eliminated.
NOW, THEREFORE, BE IT RESOLVED, that the City of Saratoga strongly
endorses the continuation of the existing State of California Solar Energy Tax
Credits as promised by the State Legislators; and further, endorses the exten-
sion of the State of California Solar Tax credits beyond the 1983 deadline.
The above and foregoing resolution was passed and adopted at a regular meeting
of the Saratoga City Council held on the 2nd day of March , 1983, by the
follc~ing vote:
AYES: Councilmembems Clevenger, Fanelli and Mayor Calbn
NOES: Councilmembers Mallory and Moyles
ABSTAIN: None
Mayor
ATTEST:
City Clerk