A recent front-page story in the Cape Cod Times uncovered a situation where the American recovery and Reinvestment Act (the ARRA – remember that?) has been successful. And since it involves sustainability and since the words “project manager” and “jobs” were featured heavily throughout the story, we thought we’d share much of it with you here.
Many have clamored against such stimuli, asserting that this is “big government” getting “on our backs” and riding taxpayers.
However in this case, utility-cost-reducing solar panels, thanks to the ARRA, are being installed at Cape Cod Community College. That article – an interesting read in and of itself, can be found here:
One quote from that article, though, is what caught writer Sean Gonsalves’ attention:
“The total cost of all the (alternative energy) projects (at the college) will come to more than $4 million … an investment tax credit through the American Recovery and Reinvestment Act helps make it affordable for the company.”
Gonsalves caught up with Allen Giles, president of Turning Mill Energy, the Sandwich-based company installing the college’s solar panels.
He asked Giles flat-out, does he think these alternative energy investment tax credits, or “subsidies,” are an example of “job killing” big government getting in the way of private-sector growth?
“Actually,” he told Gonsalves, “it’s the opposite.”
The section below is extracted from the article:
Giles (whose father named him after the Allen wrench) pointed out the difference between political rhetoric and reality.
“A tax credit allows successful businesspeople who have a tax burden to take their tax dollar and invest it in new projects, rather than the government giving out grants,” he said.
These sorts of tax credits, Giles explained, puts tax dollars to work directly into a project, which provides an “effective” economic stimulus.
“Traditionally, renewable energy projects were very large,” he said.
“Large investment firms invest in large solar farms and large wind farms because they get paid on putting the deal together. And let’s be honest, they’d rather get 2 percent on $100 million dollars than 2 percent on $1 million.”
The stimulus bill allowed Giles’ company to bring together individuals in the local economy who had a tax burden, and instead of sending taxes owed on investment income to the Internal Revenue Service, it let them reinvest that money in renewable energy projects.
“These tax credits can be used to offset federal tax obligations. That’s putting tax money straight to work, with no overhead associated,” Giles said.
“If I wanted to do the college project before the (stimulus bill), I would’ve gone to a large investment firm. And they pretty much laugh at me because the project wasn’t $100 million,” he said.
The backstory, Giles said, is that Turning Mill used to be a company that built cellphone towers, which was a booming business up until 2006-2007.
Then the recession hit.
“We had close to 25 employees from the Cape region. But, starting with the financial downturn, we had to lay folks off,” he said.
The company had to come up with a new business plan.
They started looking at renewable energy, Giles said, because “to us, putting up a wind tower is same process as putting up cell towers.”
Giles said the stimulus bill and the commonwealth’s 2008 Green Community Act, which allowed for renewable energy to be sold to electricity suppliers, “was kind of like the perfect storm.”
“We’ve hired back a lot of the people we had to let go,” Giles said.
And Turning Mill jobs aren’t low-wage service and retail jobs.
“We’re talking about permitting specialists, engineers and project managers. Also, we were able to hire our own crews â€” electricians and laborers,” Giles said.
The best part, he said, is that Turning Mill is diving into the local labor pool.
“We’ve found the local pool to have tremendous experience in this line of work,” he said. “We are the poster child for taking advantage of thoughtful legislation.”
Imagine, if the community college trained the specialists, engineers, project managers and electricians of tomorrow, helping to stave off the economically harmful demographic trend of young people leaving the Cape in search of jobs.
Of course, to understand the Cape’s economic interests clearly, we have to cut through the stormy rhetoric and see reality.
So in this case – and we would imagine that – although Cape Cod is a nice and unique place – this scenario is, or could be repeated all over the US, if people would have the long-term thinking and creativity to do what’s being done at Cape Cod Community College with the ARRA tax credits.
More jobs, more projects, more project managers, and greater sustainability. As Michael Scott, of The Office would say, “it’s all good”.