Millinocket meets with lawyers over GNP debt, has ‘decided direction’ for collecting money

Millinocket Town Council Chairman Richard Angotti Jr. listens to residents during a council meeting on Feb. 27, 2014.
Nick Sambides Jr. | BDN
Millinocket Town Council Chairman Richard Angotti Jr. listens to residents during a council meeting on Feb. 27, 2014. Buy Photo
Posted July 22, 2014, at 7:59 p.m.
Last modified July 23, 2014, at 5:05 a.m.

MILLINOCKET, Maine — Town leaders emerged from a private meeting on Tuesday confident that they were developing a strategy for handling Great Northern Paper Co. LLC’s $1.18 million property tax debt that would emerge within two weeks.

Town Manager Peggy Daigle said the Town Council’s executive-session teleconference with attorneys Rob Crawford and Wendy Paradis of the law firm of Bernstein Shur concerned GNP’s inability to pay its tax bill. Council Chairman Richard Angotti Jr. and Daigle declined to comment on what actions they would or could take against Great Northern.

The strategy “is still in the discussion phase,” Daigle said Tuesday.

“I don’t think it will go on for long,” Daigle said Tuesday. “We have a decided direction that we are going in, and I think you will see [some action taken] in a week and a half, two weeks.”

Alexandra Ritchie, spokesman for GNP manager Cate Street Capital of New Hampshire, could not be reached for comment on Tuesday.

No council votes occurred on Tuesday. Councilors said they didn’t expect any council actions on GNP’s debt to occur at Thursday’s meeting. No items concerning GNP’s debt are on that meeting’s agenda, they said.

The town’s top taxpayer, GNP hired Koster Industries to auction GNP equipment from its Katahdin Avenue industrial site on June 17 to pay taxes owed to Millinocket and the Internal Revenue Service. The auction apparently came in response to IRS and town liens on the equipment.

But Koster has paid only $358,000 to the town to date. Koster made a $133,500 payment Friday and a $225,000 payment on July 3. It failed to make a $340,000 payment on July 8 and a $360,000 payment on July 14; the rest was due on Monday, according to the payment schedule.

Koster officials told town leaders a few weeks after the auction that collecting money from the auction participants has been much more difficult than they expected. Communication with Great Northern and Koster since the schedule was set July 3 has been “very scant,” Daigle said.

Koster officials “explained that they are working on behalf of GNP and that they don’t want to get caught up with the issues on the municipal level,” Daigle said. “Our problem here is GNP and Cate Street.”

“Pretty much we are communicating [with Cate Street and GNP] through lawyers,” she added.

Town Council member Jimmy Busque called the situation “a complicated mess” when he emerged from the executive session, which occurred in the town manager’s office. The solution, Angotti said, is “a lot more complex” than just slapping liens on GNP property. He declined to comment further.

“We just want to get that tax bill paid so that the people [of Millinocket] get what they are owed,” Daigle said. “It’s just a sad situation.”

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