August 22, 2019
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Owner of Bucksport’s defunct paper mill seeks tax break on power plant

Nick Sambides Jr. | BDN
Nick Sambides Jr. | BDN
The town of Bucksport and the company that owns the mill site (background) are appraising the value of the site's power plant.

BUCKSPORT, Maine — The town’s top taxpayer seeks to lower the assessed value of its power plant and cost the town about $298,436 this year.

American Iron and Metal, a scrap metal recycler that owns the former Verso Paper mill site, seeks a reduction of the value of the site’s gas-powered electrical generator from about $60 million to $42 million, Tax Assessor Jef Fitzgerald said.

That means that at the town’s property tax rate of $16.30 per thousand of assessed value, the approximate amount in property taxes paid by AIM subsidiary Bucksport Generation LLC would drop from $983,036 to $684,600 for the 2018-19 fiscal year, which ends June 30, Fitzgerald said.

AIM’s local representative, Jeff McGlin, a vice president at AIM Development USA, did not immediately return messages seeking comment on Thursday.

AIM is the town’s top taxpayer, with the value of the mill site equating to about 17 percent of the town’s tax base — down from the 45 percent of the base that the property represented when the mill was operational, Fitzgerald said.

The town has hired its own appraiser, but Town Manager Susan Lessard said the reduction request was expected. The town hasn’t assessed the generator since 2015, a year after the mill closed, and AIM has removed a great deal of equipment from the site, making appeals likely, she said.

“Neither the town or AIM is seeking a war here,” Lessard said Thursday.

Fitzgerald said the town doesn’t necessarily contest the devaluation of the generation facility proposed by AIM. The value of the plant changed when it became clear that Verso or another papermaker would not restart the mill, which the generator was built to power. The change in use could affect the plant’s value, Fitzgerald said.

But the town has hired an appraiser, Glenn Walker from the firm of George E. Sansoucy, LLC of Portsmouth, New Hampshire, to do its own appraisal of the power plant.

The Town Council voted 7-0 on Feb. 14 to hire the firm for hourly rates of $125 to $300 per hour depending on the level of expertise of the workers involved, but for a total not to exceed $20,000, Lessard said.

Councilors opted to go with the firm because its workers have the expertise to assess the plant’s value, a highly technical undertaking far beyond most municipal assessors’ capabilities, Lessard said.

Sansoucy specializes in utility appraisals. Its past projects include appraisals of two New Hampshire power plants, Seabrook Station nuclear power plant of Seabrook and the third-largest coal-fired electrical plant in New England, Merrimack Station of Bow.

Sansoucy also appraised the Verso plant in 2015. The town did not seek bids from other appraisers because of Sansoucy’s experience and the firm’s 2015 bid having been significantly less than competitors, Fitzgerald said.

Under state law, the town has 60 days to respond to Bucksport Generation’s request or its non-response would constitute a denial. Then Bucksport Generation could appeal to the town’s Board of Assessment Review, a state review board and civil courts, Fitzgerald said.

The town has received a 30-day extension from AIM on its request, which was filed in late November, and expects to seek a 45-day extension when the latest allotment of time permitted by AIM expires next week, Lessard said.

Fitzgerald said he expects any loss in taxes to AIM will be offset by the $250 million salmon farm and Maine Maritime Academy annex due to go on the mill site in the next year.

“We just want to go through the [appraisal] process with AIM and come up with a fair number,” he said.



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