BUCKSPORT, Maine — Town councilors have given initial approval to a tax incentive for the Verso Paper company’s $40 million plan to upgrade a boiler and run a turbine off it at its Bucksport mill.
After several meetings between councilors and Verso officials, the Town Council approved an agreement subject to review by the town attorney and a public hearing.
The two-part agreement proposed by Verso involves tax increment financing, which invests tax revenues in new development. In the first part the councilors agreed to extend an existing TIF by 10 years to the 30-year limit allowed by law with the same split of the TIF revenues: 75 percent going back to the company and 25 percent to the town for economic development projects.
In the second part councilors gave preliminary approval for a new TIF covering Verso’s plan to upgrade the mill’s No. 8 boiler and install a new turbine to run off it. The TIF revenues would be split the same as the in the existing TIF.
According to Town Manager Roger Raymond, the vote was 5-2 in support of the proposed agreement, although councilors felt the town should get more than 25 percent of the new TIF revenues.
The proposed TIF agreement establishes specific areas where the town’s share of the TIF funds can be spent. The funds will target improvements in public safety, highways and the municipal treatment plant, all of which are related to the mill. In addition, he said, a portion of the funds would be used to create a training program for potential mill employees.
A pulp and paper course required for employees at the mill is offered through the Kennebec Valley Community College, but Raymond said they hoped to set up a local course in Bucksport.
“We plan to use the TIF revenues to provide an opportunity for high school students and other citizens to attend the course here,” Raymond said.
Opportunities at the Bucksport mill will increase over the next decade as the existing, aging work force retires.
“The job opportunities are going to be expanding at the mill,” he said. “We want to give our citizens the opportunity for those jobs.”
Mill officials had indicated that the TIF would be an important part of the boiler-turbine project and would help to convince company officials to back the project.
“We really appreciate the time the council put into this,” said Verso spokesman Bill Cohen. “The bottom line is that the council showed its support for the project, and that is most sincerely appreciated.”
Raymond said the councilors recognize the benefits the mill provides to the town and want to support it so it continues to provide opportunities for area residents.
“The mill is important to us,” he said. “It provides good jobs and a lot of them. And it’s given us the ability to do things in Bucksport that other towns this size are not able to do. And we’ve been able to keep those opportunities at a time when other mill towns have suffered significant losses.”
The new project involves upgrading the existing boiler to burn more biomass and using the steam generated to run the new turbine. The electricity generated by the turbine then can be sold to the grid through a deal with Bangor Hydro-Electric Co.
Verso headquarters has not yet given the project the green light. Although Cohen said Verso officials have been supportive as the project has developed, final approval from the Verso board is still needed. He said Friday that he did not know when a decision would be made, but the mill is moving forward with planning and permitting.
“We’ve got three or four elements we need to pull together, and we’re working hard on them,” he said. “Things are really getting geared up.”
The mill is ready to apply for the necessary permits, and public notices to that effect are appearing in area papers.
“If this project is going to go, we need to start construction before the end of the year,” he said.
Meanwhile, the council will hold a public hearing on Oct. 28 before a final vote on the TIF proposal.