JAY — The tax rate will increase following the settlement of a tax dispute on the valuation of the Androscoggin Mill and related property for the years of 2013, 2014 and 2015, Town Manager Shiloh LaFreniere said.
Selectpersons agreed to give paper mill owner Verso a credit of $4 million over the next three tax years in six credits of $666,667. Town officials also agreed to cap at $6.75 million Verso’s tax liability payment beginning April 1, prior to factoring in exemptions and tax-increment financing payments to the town, until it reaches $4.75 million on April 1, 2020.
The town’s tax rate is $17.25 per $1,000 of property valuation. The rate has increased by $3.25 over the past two years.
The tax caps will result in a reduction in tax revenue from the Verso mill.
“However, it has been anticipated that these reductions would likely be reflected in Verso’s value for the upcoming years due to the decline in market conditions,” LaFreniere said.
The agreed-upon tax caps simply give each party a level of financial certainty for the near future, she said.
Town officials entered into the agreement because additional litigation would involve significant expense, time and risk on the part of both parties, and a final decision would not be rendered in the near future, causing financial uncertainties for the town and Verso, LaFreniere said.
The town has spent more than $300,000 on appraisals, litigation and attorneys’ fees, among other expenses.
How much of an increase there will be in the tax rate is unknown at this point because of not having the figures for the town’s share of the Franklin County budget for 2016-17, LaFreniere said.
She also is waiting to hear from the state tax assessor on the town’s application for an adjustment to the municipal valuation because of the sudden and severe loss of valuation. It is expected to result in additional subsidy in education funding and municipal revenue-sharing.
In addition, the assessments have not been finalized for residential and personal property in the town for the upcoming year.
There have been additions throughout the town that will help offset some of the loss in revenue from the mill, LaFreniere said.
“We will be running scenarios/estimates in the next couple weeks,” she said.
Her intention is to get the information to people as soon as they have solid information, she said.
Town representatives continue to work with Verso to ensure the survivability of the mill and to ensure the best outcome for local taxpayers, she said.
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