JAY — Verso Androscoggin LLC filed an application for a 2013 abatement of property taxes on Tuesday. The request asks the town to abate $469 million in valuation from the company’s real estate and personal property at the Androscoggin Mill.
The company said the paper mill and its property are overvalued by the town.
“We have been talking with the town of Jay for some time about the mill’s assessment,” Verso spokesman William “Bill” Cohen said Wednesday. “Because of weather we have had several settlement meetings postponed and are now up against a statutory deadline for filing an appeal.
“We will continue to work toward a mutually agreeable settlement and the appeal does not hinder that process,” he said. “We trust that we can continue to work together to ensure that the town of Jay protects its tax base for the long run while also following through with its responsibility to be accurate in the mill’s tax assessment.”
“The town of Jay has received the abatement request from Verso, and of course the town will make every effort to study the situation,” Town Manager Ruth Cushman said. “We will continue to work with Verso to resolve this, but we feel that we have been diligent in our efforts to produce a fair and equitable value. We appreciate Verso’s willingness to work with us on this.”
Verso’s “intent is not to hurt the other taxpayers of the town of Jay,” Cohen said. “We live and work here, too. Our intent is to make sure we pay our fair share of the taxes, based on proper and legal assessing so that we can ensure we remain part of this community.”
Two meetings to discuss the valuation of the mill were postponed due to snowstorms.
Verso, according to law, had until Feb. 27 to file its application. It was filed early because the company’s attorney, Jonathan A. Block of Pierce Atwood in Portland, is going on vacation, both parties said.
Cushman, incoming Town Manager Shiloh LaFreniere, assessing agent Paul Binette and the town’s attorney, Steve Langsdorf of Preti Flaherty in Augusta, will meet with Verso representatives the first week of March to discuss the matter, Cushman said.
According to Verso’s abatement application, the mill’s real estate valuation is listed by the town at nearly $140.5 million and the personal property valuation at $788.5 million.
According to Jay’s tax commitment data, the town values the mill’s property at $815.4 million. That does not include the $111.9 million assessment of tax-exempt assets related to the state’s Business Equipment Tax Exemption program, Binette’s information shows.
The town taxed Verso $11.4 million in 2013, but $2.4 million in taxes would be or have been given back due to two tax-increment financing agreements. The two 20-year TIF agreements were approved by voters in 1995 and 2004.
The mill’s taxes after the TIF are $9 million. Verso pays 69 percent of the town’s property taxes, according to Binette.
Verso’s abatement request of $469 million in value equals about $6.5 million in taxes, not factoring in any exemptions, according to Binette.
Verso said the mill’s property is overvalued at a total of $929 million. It said the just value is $460 million, according to an appraisal done by Duff & Phelps of Chicago.
Verso said the town’s assessor did not use proper valuation techniques. Among other things, the assessor did not consider the income approach to valuation, did not consider obsolescence and did not properly perform the cost approach, the company said.
The town has had industrial appraisal firm Corporate Valuations of Oregon, formerly known as ValPoint, on board since 1998, when it conducted an appraisal of mill properties that year.
Since then the town uses the base valuation and factors in the additions and deletions Verso sends to the town each year and uses valuation methods, including trending, Cushman previously said.
Jay voters approved spending up to $125,000 for industrial valuation specialists in January.
Selectmen have 60 days from the time the abatement application is filed to act on the request or do nothing with it. If the latter occurs, it means it was denied, Cushman said.