WATERVILLE — City councilors will take a final vote Feb. 7 on whether to approve a tax increment financing district for Kennebec Valley Gas Co.’s proposed natural gas pipeline.

The council on Tuesday took a second vote to approve a tax district and related development program for the pipeline and must take a total of three votes.

City Manager Michael Roy said Wednesday that the property to be part of the TIF is currently tax exempt.

“It’s a roadway,” he said. “The gas pipeline will be going on the edge of the roadway, so that’s land that’s not taxable. If we give up taxes on that property, we’re not losing anything.”

The pipe itself, however, is taxable, he said.

“Although we’re giving up 80 percent of total revenues in the first 10 years, we are sheltering that new value added to the city’s valuation. The city’s valuation will not increase as a result of the pipeline being built.”

Roy said the pipeline would run on the western edge of the city. It would run down Kennedy Memorial Drive to Silver Street, go through downtown and up College Avenue.

“That is the major route,” he said. “Once the pipeline is installed and we tax it, we’ll collect taxes. As part of the TIF agreement, we give 80 percent of what we collect to KV Gas. They have to apply that to the debt service for their pipeline project.”

The city would keep 20 percent and may either place the money in the general fund or designate it for economic development projects.

The state must approve the TIF district and related development program.

In other matters Tuesday, councilors voted to refer to the Planning Board for public hearing and recommendation a request to rezone five parcels owned by Thomas College.

Amy Calder — 861-9247

[email protected]

 


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