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Jurisdictional Authority: Who Has the (Solar) Power?

August 05, 2014 by Sherry Stout

Jurisdictional authority has been a complex issue for more than a century. As the Cornell University Law School's website elegantly puts it, "The question of whether a given court has the power to determine a jurisdictional question is itself a jurisdictional question."

Some states allow localities to have significant decision making authority on select topics, while others only grant limited control. With more than 18,000 jurisdictions established throughout the United States, it can be difficult to understand who has the power when multiple jurisdictions may be operating within a single county.

The issue of overlapping jurisdictions has come up in several NREL Solar Technical Assistance Team (STAT) requests. Fortunately, there are several opportunities for using policies and programs to support solar markets in many different jurisdictional authority contexts.

So what do people mean by Home Rule vs Dillon's Rule? In 1868, the Supreme Court issued a ruling in which Justice John Forrest Dillon said, "Municipal corporations owe their origin to, and derive their powers and rights wholly from, the legislature" (Clinton v. Cedar Rapids and Missouri River. R.R. – 24 Iowa 455, 1868). This ruling is widely known as Dillon's Rule. It allows states to define their own powers to regulate local affairs or grant authority to local jurisdictions. Many states have used Dillon's Rule to grant some authority to local governments, which is considered Home Rule. For more information on Dillon's and Home Rule outside of the solar context, see the National League of Cities website.

Both Dillon's Rule states and Home Rule jurisdictions have opportunities when it comes to developing solar markets. In some instances, local governments are in a position to understand the needs and wants of the members of their local community better than their state governments. Greater powers granted to local governments can empower municipalities to tailor solutions that fit local needs.

On the opposite end of the spectrum, there is also evidence that state authority can lead to optimized policy for market development due to increased regulatory uniformity. Local control has the potential to fracture the regulatory environment and increase investor risk throughout the region. State policy, on the other hand, can create a more consistent system of regulations.

One key area where jurisdictional overlap has impacted the solar market is permitting. Permitting costs can have a large impact on the installed cost of a photovoltaic (PV) system, and therefore, the broader market development. Several local governments are streamlining the permitting process, while others have pre-empted control to effectively reduce permitting costs. The best choice for any given state depends on the existing relationship between the jurisdictions and the state, but both levels of authority have demonstrated successful strategies.

State pre-emption of local authority can create uniformity as in the case of Colorado capping local solar permitting fees. Prior to 2011, Colorado's permit fees were rapidly escalating and, in some jurisdictions, exceeded the cost of the PV equipment (VoteSolar 2011). Fees ranged from less than $250 in some counties to greater than $2,000 in others (VoteSolar 2011). In response to these escalating fees, the Colorado state legislature extended existing caps on permit fees and closed loopholes to further reduce costs.

Local governments also have the ability to move markets through innovative permitting processes. The City of Chicago, for instance, created the Green Permits Program in which projects can receive permits within 15-30 days and also qualify for partial waiver of review fees (DSIRE 2012). With support from the SunShot Initiative Rooftop Solar Challenge, Broward County in Florida launched the streamlined Go SOLAR website, which can provide a solar energy system permit and a preapproved set of design plans in just 30 minutes.

Ultimately, both states and local governments can accomplish solar market support goals—regardless of the overlapping jurisdictional policies in place. A high level of coordination and communication between state and local government authorities seems to create the greatest opportunity for success in solar market advancement.