Measure E would amend Article XII of Chapter 11 of the Solano County Code to increase the business license tax on commercial wind turbine generators and impose business license taxes on commercial solar energy systems, front-of-the-meter battery energy storage systems, natural gas extraction facilities, and data centers in the unincorporated areas of Solano County. Measure E requires approval by a majority of voters voting on the measure to pass.
Fiscal Impact: Revenues would be deposited into the County General Fund and could be used for any lawful governmental purpose. County staff estimate the measure would generate approximately $353,000 in additional annual revenue.
Pro:
Supporters say that Measure E would update and extend the business license tax on commercial wind farms to keep pace with inflation. This is an important update because the existing tax rate has not been adjusted since 1994. The measure would also extend the business license tax to other energy generation, extraction, and storage facilities, including solar farms, natural gas wells, battery storage facilities, and data centers. While there are currently no data centers proposed in the unincorporated areas of Solano County, this measure ensures that if these large-scale facilities are developed in the future, they will contribute their fair share toward the County services and infrastructure they rely upon.
Supporters say that this measure helps strengthen our local economy, protect essential County services, maintain critical infrastructure, and ensure that visitors and large corporations contribute their fair share toward the public services and resources they use.
A YES vote on this measure means: Approve the proposed amendments to the County's Business License Tax.
Con:
Opponents say Measure E would raise and expand Solano County’s business license tax to include wind turbines, solar farms, battery storage systems, natural-gas extraction facilities, and data centers. While measure is presented as a minor update that “generates approximately $353,000 annually,” it is actually a new and permanent tax expansion on industries that already face regulation and infrastructure costs.
Opponents say that this tax increase directly affects small businesses that already struggle with rising costs. When business taxes go up, prices rise, and residents pay more for everyday goods and services, making daily life more expensive for ordinary families. The County frames Measure E as a fairness adjustment, but the details tell a different story. The proposal raises the wind-energy rate by more than 160% and adds entirely new taxes on solar and battery facilities This discourages investment in clean-energy projects that create local jobs and long-term revenue.
A NO vote on this measure means: Retain the current Business License Tax provisions, including the existing commercial wind turbine tax rate, without the proposed tax categories or annual inflation adjustments.
Background
Solano County established a business license tax on commercial wind turbine generators in 1994, and the current tax rate of three one-thousandths of one cent ($0.00003) per kilowatt-hour has remained unchanged for more than thirty years. The County's current business license tax on commercial wind turbine generators and other activities and periodic inflation adjustments help preserve the real value of business license tax revenues over time and ensure that all covered industries continue to contribute equitably toward the cost of general County services and infrastructure.
The existing Business License Tax on commercial wind turbine generators does not contain an inflation adjustment mechanism and, as a result, the real value of revenue generated by the tax has substantially declined over time due to inflation since 1994.
Since the adoption of the Business License Tax on commercial wind turbine generators in 1994, proposals for large-scale commercial solar energy systems, front-of-the-meter battery energy storage systems (BESS), natural gas extraction facilities, and data centers have become increasingly prevalent throughout the State of California, and are anticipated to become more frequent in the unincorporated area of Solano County. These facilities are not currently subject to a business license tax specifically calibrated to their commercial activity or operational scale in Solano County. These facilities utilize County infrastructure, transportation networks, regulatory services, emergency services, and other governmental resources and it is appropriate and in the best interest of the County and its residents to modernize the Business License Tax to ensure these facilities contribute toward the cost of general County infrastructure and services
Proposal
If approved, Measure E would amend Article XII of Chapter 11 of the Solano County Code to increase the business license tax on commercial wind turbine generators and impose business license taxes on commercial solar energy systems, front-of-the-meter battery energy storage systems, natural gas extraction facilities, and data centers in the unincorporated areas of Solano County.
Beginning January 1, 2028, the tax rates would be adjusted annually based on changes in the Consumer Price Index for All Urban Consumers but could not decrease. The Director of Resource Management would calculate and publish the adjusted rates. Persons or entities exempt from business license taxes under federal or state law would remain exempt.
Specifically, Measure E would:
- Increase the commercial wind turbine tax rate from $0.00003 to $0.00008 per kilowatt hour
- Impose a tax of $0.00008 per kilowatt-hour on electricity generated by commercial solar energy systems
- Impose a monthly capacity-based tax of $1.50 per megawatt-hour of approved energy storage capacity on front-of-the-meter battery energy storage systems, regardless of actual charging or discharging
- Impose a tax of $0.30 per thousand cubic feet of natural gas extracted
- Impose an annual tax of $5.00 per square foot of gross floor area on data centers, including equipment-pad areas associated with ancillary behind-the-meter battery energy storage systems and natural gas turbines supporting a data center. The tax would not apply to information technology infrastructure that is accessory to and primarily supports specified on-site uses.
Source: Impartial Analysis of Measure E