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The answer (to some energy costs)
just might be blowing in the wind
By ROMAN PRZEKOP and
LYNDA K. GIVEN
Chapman and Cutler LLp, Chicago, IL
Introduction
Along with flagpoles, bike racks, goalposts
and bleachers, one more improvement may
soon be commonplace on Ilinois schoolgrounds: windmils. An increasing numberof Ilinois school districts are considering the
construction of a windmil or wind turbine
on their school sites. Depending on the
size of the turbine and the electricity needs
of a particular school building, a windmil
. can provide for a substantial portion of
the school building's power needs. In thismanner, a school district can become less
reliant on traditional power sources and moreenergy effcient. By utilizing the wind, an
environmentally friendly, clean renewableenergy source, school districts can reduce theirenergy costs..Although a school district may have
to borrow money to pay for the costs of
acquiring and installing a wind turbine, thetotal cost of the borrowing may be lessened
12
as a result of the federal Energy Policy Act
of2005. In August 2005, as part of
the
Energy Policy Act of2005, Congress enactedSection 54 of the Internal Revenue Code (the
"Code") permitting "qualified issuers" to issue
clean renewable energy bonds ("CREBS") in
order to finance "qualified projects" like wind
turbines. CREBS are taxable bonds, but their
owners receive a tax credit (instead of interest)
if they own CREBS on one or more quarterly
credit allowance dates. Hence, CREBSprovide financial benefits to both schooldistricts and their investors.
Volume Cap
Currently, the amount ofCREBS that can
be issued nationwide is limited to $1.2 bilion.
In general, projects for governmental bodiesand mutual or cooperative electric companies
wil be allocated the full amount of volumecap requested beginning with the projects for
which the smallest dollar amount of volume
cap has been requested and continuing withthe projects for which the next-smallest
dollar amount of such volume cap has been
requested until the total amount of volume
cap is exhausted.
see WINDMILLS page 13
U date: Illinois Association 0 . School Business 0 cials
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