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Solar energy case could impact property owners

ANN ARBOR (AP) — A Michigan resident is at the center of a solar energy taxation debate that could affect property owners statewide.

The dispute revolves around how much value Mark Clevey’s residential solar energy system adds to his home and if that value should be taxed, the Ann Arbor News reported .

Clevey installed the system on his house in May 2016. Tax records show the property’s value increased from almost $1,900 in 2015 to nearly $5,700 in 2017.

Clevey unsuccessfully went to the city’s board of review in an attempt to adjust the taxable value of his house.

He then turned to the Michigan Tax Tribunal and is awaiting a decision.

The city of Ann Arbor believes the system improves Clevey’s property and should increase its taxable value because state law doesn’t specifically exempt solar energy systems. But Clevey said the system is personal property, which generally isn’t subject to property taxes.

Some communities don’t tax residential solar energy systems. State agencies have also offered conflicting guidelines toward taxing the systems.

There’s an existing personal property tax exemption that allows for property owners to seek an exemption for small scale solar projects, according to the Michigan Agency for Energy and Michigan Public Service Commission. But the Michigan Tax Commission said the exemption doesn’t apply in areas where the assessor considers residential solar energy systems to be real property.

Tax Tribunal Judge Robin Schleh will give the final opinion on the issue. Her preliminary opinion in December sided with the city. Parties had additional time to file exceptions before the judge issues a final ruling.

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