Eagle Solar Group’s proposed solar farm project near Butter and Egg Road took a hit on Tuesday when the Troy City Council denied to give the company a tax abatement.

Mayor Jason Reeves and the council explained Wednesday why the council made the decision.

Council President Marcus Paramore said his primary reason he didn’t vote for the tax abatement is because he doesn’t see the project bringing enough value to the city to justify it.

“I didn’t think it was a good return on investment for the city as a whole,” Paramore said.

Paramore said that he considers permanent jobs one example of the return on investment that he would look for to grant a tax abatement– a criterion not supplied by the company.

  “There would be a lot of construction jobs on this particular project, which would exist for a much shorter time than the abatement is stretched out for,” Paramore said.

Reeves said he’s comfortable with the council’s decision and feels they did their due diligence on the issue before the vote.

Reeves explained exactly what the abatements would have cost the city.

“They asked for an abatement on sales tax for $34.5 million,” Reeves said. “The City could abate 7.5 percent of (the 9 percent sales tax rate). The other 1.5 percent can’t be abated because it goes to the schools.

“The city’s portion of that is 3 percent, so you’re looking at about $1 million that the city would be giving up in taxes. That’s a substantial amount of money and so you’ve got to weigh abating that amount of tax against what the city would gain.”

Reeves also explained that the City would not be benefitting from the power “for the forseeable future” either, as they enter a new five-year power contract at the beginning of next year.

Area residents Elizabeth Grubbs and Matthew Ellis spoke at the council meeting against the abatements.

Grubbs said the community fears the effects an industrial project could have on the residential zone and said that such projects are more suited to remote locations.

Another factor playing into the denial was engagement from residents in the affected area. Two residents from the area, Elizabeth Grubbs and Matthew Ellis, spoke to the council during the meeting about their concerns.

Grubbs, who said she was chosen to speak on behalf of the residents of the Arrowhead Drive community, asked the council to “deny, deny, deny, deny, deny” the abatements over concerns the community had about what the project might mean for traffic, the environment and property values in the area.

“Obviously the residents feel they would be adversely affected,” Reeves said. “They certainly would be adversely affected, at least for a time.

“Research bears out that there would be a tremendous amount of traffic and construction. That’s a large project. Certainly there would be a great deal of traffic and disturbance initially.”

David Herskovits, a representative for the company, told the council at a previous work session that a commitment to giving a tax abatement is a “pre-requisite” for the project coming to the City, but Reeves said he isn’t sure that the denial rules out the project from coming.

Herskovits is scheduled to represent the company at tonight’s Board of Adjustment meeting about getting the business a special exemption to locate on the proposed property, as portions of the property falls under residential zoning.

The council members unanimously applauded the residents being involved with the process and encouraged them to attend the meeting tonight to make themselves heard once again.

The Board of Adjustments meets tonight at 4 p.m. in the city council chambers of City Hall to consider the request.