IP will be reimbursed
60 percent of the taxes it pays on the new investment.
JAY – Residents voted 356 to 79 Monday to give International Paper a tax break over 20 years if the company invests millions to upgrade machinery and equipment.
It was a slow day of voting for ballot clerks. By 6:25 p.m., only 369 registered voters out of 3,715 had cast ballots in the all-day referendum. There were about 50 absentee ballots, Town Clerk Ronda Palmer said.
IP proposes to invest $112 million to rebuild paper machine No. 3, which makes coated paper, and upgrade its wood operations, bleaching plant and transformer system. “Obviously, I’m very pleased the people of Jay are encouraging International Paper to develop and invest in our community,” Town Manager Ruth Marden said. “This could be a real win-win situation for everybody concerned.”
In the partial tax break, IP will be reimbursed 60 percent of the taxes it pays on the new investment and the town would keep 40 percent of the new taxes. The tax increment financing agreement sets up two development districts. One would cover IP’s proposed investment of nearly $109 million to rebuild the No. 3 paper machine and upgrade the wood process and peroxide plant. The other district would cover an investment of $3.5 million to upgrade the transformer system.
IP would continue to pay taxes on the original assessed value of the equipment and machinery, which combined is nearly $120 million. The tax break would only be on the new investment. During the life of the TIF, based on a current tax rate of $15.80 per $1,000 of valuation, the town would gain a projected $6.1 million in tax revenues and IP would retain a projected $9.2 million in tax savings.
Monday’s vote eliminates all the old TIF districts that were formed in 1995 and never used. A clause in the TIF agreement requires the company to keep paper machine numbers 1, 2 and 5 meeting specific production levels each year or IP will receive less reimbursement and the town more.
IP is also required to pay yearly administrative costs, appraisal and legal fees connected to the TIF, and the cost of the referendum vote. Selectmen also included a clause in the agreement that IP consider for employment qualified applicants for maintenance and production positions from Jay, Livermore, Livermore Falls and Wilton.
Comments are no longer available on this story