JAY — The Board of Selectmen unanimously approved a $1.50 tax rate increase Tuesday afternoon, less than two weeks after the Androscoggin Mill, the town’s largest taxpayer, announced it will lay off 300 people this fall and cut back on production.
“The tax rate is going up,” said Paul Binette, the town’s assessor’s agent, after a special Board of Selectmen’s meeting Tuesday. “It’s hard to say how people run their households, but there are many folks on fixed incomes that are just barely squeaking by as it is. Also, for the folks that are about to get laid off, being handed a higher tax bill is certainly not good either.”
The increase of $1.50 brings the tax rate from $15.75 per $1,000 of assessed value to $17.25 and is directly related to a loss in value at the mill, Binette said.
Over the last two years, the mill’s assessed value has dropped nearly $300 million. Owned by Verso Corp., it is valued at $691,792,058, down from $988,068,906 in 2013.
In 2014 it contributed $8,478,641 in property taxes to the town. “We need that money to operate,” Binette said.
With the recent loss in value, the town has had to raise taxes to make up for the loss of tax revenue coming from the mill. Last year the tax rate rose $1.75 with the board voting to use about $700,000 in undesignated money to offset the increase, Binette said.
The 2015-2016 assessment for the mill was set April 1, and it is too early to tell what effect the recent cutbacks at the mill will have on future assessments and tax rates, he said.
The mill is in the process of appealing the town’s 2013 assessment, and town officials say they expect the mill also to appeal the town’s denial of an abatement request on the mill’s 2014 taxes.
A decision on the 2013 abatement request is expected in December or January from the State Board of Tax Review.
“Even though we received some bad news in August, it’s still not reflected (in the mill’s assessment),” Binette said. “It may affect our decisions when we establish values next year, but for the time being our assessment was set April 1 for 2015.”
On Aug. 20, Verso announced it will shut down two machines at the Jay mill, laying off 300 people and reducing production by about 150,000 tons of coated paper and 100,000 tons of pulp.
Specific employees haven’t been identified for layoffs, and the company is working on offering early retirement packages to some, said Bill Cohen, manager of communications and public affairs for Verso in Maine on Tuesday.
“Until we get that done, we can’t move on to the next step,” he said. “You can’t start identifying who is going or who is staying until you know who is taking early retirement. That’s what we’re working through right now.”
Al Landry, a resident at Tuesday’s selectmen’s meeting, said the news of the layoffs a few weeks ago and the tax increase didn’t come as a surprise.
“We all knew this was coming,” he said. “If I was having a hard time, I would ask for an abatement too.”
Rachel Ohm — 612-2368
Twitter: @rachel_ohm
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