ADRIAN, N.D. — Potential wind development is both an opportunity and a dilemma for farmland owners and their farm operators.
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David Barnick, 57, lives in Jamestown, N.D. He and his wife, Lisa, farm near the village of Adrian, N.D., in LaMoure County.
The Barnicks raise corn and soybeans on a farm that is half owned, half rented. Barnick farms with his two brothers, Tom and Jerome, and a son, Kane, 21.
During the 2020 harvest, two wind development companies sent “Dear landowner” letters, asking for farmers to commit land to install wind towers for a proposed project in LaMoure and Stutsman counties.
Up to now, he’s been neutral on wind farms. “It’s kind of like oil wells. I think, gee, I wish I had a half dozen of those on my land, raking it in,” he said.
Barnick met with the first sales representatives of both Invenergy and NextEra Energy Resources in December. His landlords started calling him for advice.
“They want to do what’s good for the land, and for the tenant, which would be me in this case,” he said. One landlord called from California, concerned and curious. “I said, 'we just want to make sure we do a little research — slow down and not rush into anything.'”
One company contract shared with Agweek indicates a $1,000 signing bonus, plus an option payment of $1,000 for up to 160 acres for three to five years until it’s built or not. On parcels larger than 160 acres it’s $8 per acre per. Once in place, annual payment for turbines would be $6,000 per 1 megawatt. These towers are 2.8 megawatts per tower, so the deal here is about $16,800 per tower for landowners. Property taxes are about the same amount to the government, with two-thirds to the county and one-third to the state. Sales tax of 5% on $1 million for equipment for tower installation is about $50,000 per tower.
Properties signed in the project area that don’t receive a tower still get $35 per acre annually.
Reaction has been mixed. Some neighbors “couldn’t sign quick enough” with the first company that approached them, Barnick said. Some didn’t realize there was a second company. One group of landowners took both proposals to a Fargo lawyer specialist to compare the details. There have only been one-on-one meetings because of COVID-19.
The question is two-fold: Whether to do it at all, but also whether he’s chosen the right company.
“A lot of these are anywhere from from a 49-year lease up to a 99-year lease,” he said, but acknowledges he’s no expert. The consequences are irreversible. “It’s not like if I want to buy a combine or a tractor and if I don’t like it I can trade it off in a few years, or get rid of it, or sell it. You’re stuck with these things forever.”
Barnick half-jokes he’ll “only be kicking for another 20 or 30 years,” and then it’ll be his family’s benefit or burden, adding with gravity, “A person wants to make the right decision.”
On one hand, he thinks of landowners whose parents or grandparents signed up with wildlife easement agreements and later regretted it.
On the other hand, Barnick knows that if he doesn’t sign up but a neighbor does, he’ll be looking at his neighbor’s tower “forever” and not get paid for it. He’s worried he’ll hear the “wuh, wuh, wuh,” of the towers turning from long distances.
“If they’re going to come anyway, I guess I want to be part of it,” he said. “Maybe I want to be part of it because it’s good for the environment, good for North Dakota, good for the economy, because anytime we can get more money in the area it’s good for small businesses and everything else.”
Further, he wants Great River Energy — the company that would sell the electricity in Minnesota — to succeed. They also also own the Dakota Spirit AgEnergy ethanol plant at Spiritwood, N.D., — a good market for corn farmers and a feed source for livestock producers.
“We’ve been going after a soybean plant,” he said. The Jamestown/Stutsman Development Corporation in Jamestown thought they had one locked up, but that fell through a couple years ago. “Another one is supposed to be coming in. It’ll be great. Any time you can value-add that business to an ag situation, it’s great.”
In other parts of the state, farmers have faced similar choices.
Todd Christman of Hettinger, N.D., raises cattle, and farms. In 2010, developers started studying wind in the area. The project was mind-boggling in cost, but developers made it real in 2013 and 2014. In 2015, developers built 43 towers, with roads, trenching and substations. In 2018 they built 16 more.
About eight Christman households sited 11 of the towers and share the royalties.
“There were 300 people here. It was a rat race,” Christman said, of the construction phase. “Our township … they fixed up a lot of roads for us, a lot of trails through our pastures and through our farmland, to get to these towers that we can use. They spent $220 million out here.”
The company paid crop damages. They pay about $10,000 to $12,000 a year for royalties per turbine. It’s not a huge amount in the world of farming, but pays the family’s health insurance, he said.
“The schools, the county, our township gets a fairly good hunk of it for our roads. And there’s probably eight or 10 jobs here, with MDU and the servicing contracts. I think we’re always going to need power, and more power.”
Others are not enthusiastic.
Lynn Pagel and his wife, Lori, nine years ago moved back to the freedoms of a cow-calf operation near Hettinger, N.D. — returning after a career at Basin Electric and then his own private investigative firm in Minneapolis.
Wind turbines are a half a mile from Pagel property and are easily visible a mile and a half from his ranch headquarters. Lynn sees the financial benefit for “a very few,” and a handful of employees — the direct beneficiaries of wind. He thinks the net benefit for tax base has been less than promised. He said the turbines are “very frustrating — definitely a negative — especially when you leave the city. You come because of a view, and they take the view away.”
It’s what you see
Pagel said he thinks the turbines don’t last long enough and could end up as waste, although others, like Rep. Mike Brandenburg, R-Edgeley, N.D., said obsolescence is not unique to wind power and that enterprises will arise to recycle them.
Lori Pagel, who grew up on a ranch across the border in northwest South Dakota, and went to high school with Lynn at Hettinger High School, has a special insight. After owning her own abstract and titles company, she worked for Northern States Power — now Xcel Energy — working until 2009 in their real estate department. She managed “land men,” making deals with farmers, and worked with attorneys on the easements.
“It helps the people that have the wind power,” Lori said, of the towers. “I haven’t seen the influx of taxes that I was hoping for, that they said would be coming.” She said she’d hoped to pass the farmstead on to her grown daughters — a clinical psychologist in Yankton, S.D., and another studying to be a nurse. Now that’s been ruined.
“It’s just not something you want to sit and look out at,” she said, acknowledging not everyone is offended by the same things.