LCRA purchase may deliver $90 million blow to Bastrop
Agency to buy half a power plant, stop taxes on facility.
Close to $90 million may soon come off Bastrop County’s tax rolls after the Lower Colorado River Authority decided to buy half of a power plant from its private affiliate company and stop paying taxes on a gas storage facility this year.
“It’s a big whack all at one time,” said County Judge Paul Pape. “It’s a big hit to the tax base.”
The board of directors for the LCRA, a state nonprofit public utility, decided in April to purchase a “one-half undivided interest” — worth $82 million — of a $165 million power plant in the county from GenTex Power Corporation, its private affiliate. That same month, the LCRA notified the Bastrop Central Appraisal District it would also stop paying taxes on its $5 million gas storage facility.
The changes will take about $1.25 million in property tax revenue from the Bastrop school district, $500,000 from Bastrop County and about $75,000 from the Bastrop County Emergency Services District No. 2 next year, according to Pape.
LCRA’s status as a state public utility grants it property tax exemption for property it owns, with some exceptions for property such as transmission lines. Tax exemption, however, does not extend to property used partially or wholly for a private interest.
The Bastrop County Commissioners on Sept. 28 decided not to challenge the LCRA on its claim for tax exemption on the property after discussing the situation in executive session.
LCRA officials declined to provide an interview with Phil Wilson, who serves as the organization’s general manager as well as the president and CEO of GenTex Power Corporation, which is run by a board of LCRA appointees and representatives of the power customers, such as Bluebonnet Electric Co-op.
Instead, media representatives submitted written answers to questions.
Stefanie Scott, a spokeswoman for the LCRA, said the utility purchased the assets from GenTex because they are “valuable and were available for acquisition.”
Without the reduction in the tax rolls, county residents could have seen a slight drop in their tax bills this year. The county lowered the tax rate by 1 cent to 61.9 cents per $100 valuation, but had planned to lower it 2 cents before the LCRA’s decision, Pape said.
Since property values went up, the average owner of a home in the county with a value of $129,614 would pay about $802 in county taxes. That’s about $39 more than last year when an average owner of a $121,336 house paid $763.
The county and emergency services district were able to plan ahead before passing their 2016 budgets, but the school district was not.
Mark Boehnke, chief appraiser for the Bastrop Central Appraisal District, has come under fire by county and school district officials for not notifying them sooner about the LCRA’s plans. The agency sent a letter to the appraisal district on April 10, but county and school district officials were not told until July 15.
The Bastrop school district passed its budget in May, based on preliminary projections that did not include the loss of the LCRA property tax revenue. Even though the district is looking at a $900,000 budget shortfall, Superintendent Steve Murray said he believes higher than expected enrollment should mitigate the drop. He added that he would request the school board dip into reserve funds before cutting from the budget.