WHAT TO KNOW BEFORE YOU AGREE TO LEASE TO A WIND FARM
On behalf of Michael Brooks of Law Offices of Michael A. Brooks posted in land use & zoning restrictions on Friday, January 5, 2018.
Wind farming offers a clean, renewable source of alternative energy. It also offers farmers and other owners of plots of land in just the right location a way to make some additional passive income.
However, leasing your property to a wind farm isn’t always a simple matter. A mistake on your part could actually affect your ability to use your property as you see fit for a long time, hinder inheritances and create ongoing headaches nobody needs.
While it’s worthwhile to seek legal advice in advance of any agreements about commercial land use, here are a few pieces of information that should help you navigate the new terrain:
1. If you’ve been approached by a wind farm, contact your neighbors. The odds are good that they have been contacted too — or will be soon. If you bargain jointly, you’ll increase your negotiating power. Since the company has significant resources on its side, it’s time to pool yours.
2. Call in the experts so that you understand exactly how the wind farm will affect your active growth operation. If the land is lying fallow and you don’t expect to use it, you may not have any issues. However, if the land is in use, you need to know exactly how the turbines, access roads and substations are going to disrupt any of your field’s configurations, water supply, drainage or planting and harvesting machine access.
3. Spell out the rights you have to use the land around the turbines carefully. In addition, the lease needs to state what compensation you’ll receive if the wind farm’s operation (or some failure of operation) destroys any part of your crops, products, livestock or property.
4. Consider the time limit of the lease carefully. It isn’t uncommon for a wind farm to lease land for 50 years or longer. That’s the only way they can recoup their investment and earn a significant profit. The odds are good that this will affect your heirs — and maybe their heirs, depending on your age. You may need to hold some serious discussions with your family to make a decision.
5. Don’t forget debts, lenders and liens. If you have a debt on the land, your lender may have to give permission for the wind farm. The lease should also address any liens on the property — including those brought on by the wind farm.
Source: National Wind Watch, “Five questions to ask before signing a wind-energy lease,” Liz Morrison, accessed Jan. 05, 2018
Related Posts: Exercise caution when buying a farm for a marijuana business, California eyes major zoning law changes, How can you handle a zoning problem?, Can I set up a pot dispensary in Beverly Hills?