BELGRADE — Residents and large business owners have mixed reactions to the possibility that a proposed $86 million natural gas pipeline could run through town.

Now that the town of Sidney has rejected a tax break for the project, Kennebec Valley Gas Co. officials are eyeing an alternate route that would run about 10 miles through Belgrade via routes 27 and 11 instead. They’re also asking the town for a tax break.

Richard Silkman, a partner with the Portland-based gas company, said the pipeline route through Sidney would have been one mile shorter, but Belgrade has more opportunity for natural gas customers. That includes residences, Belgrade Central School, the town office and two major businesses — builder supplier Gagne & Son and Hammond Lumber Co.

But the heads of those two potential customers were noncommittal to tapping into the gas supply.

Peter Gagne, vice-president of Gagne & Son, said he just invested heavily in making his business energy efficient and probably wouldn’t convert to natural gas.

“I can’t really say it’s something I’m going to take advantage of, if it comes through,” Gagne said. “At this point, if it were there today, I can’t say I’d jump on it.”

Donald Hammond, president of Hammond Lumber, said pipeline officials met with officials from his business last Thursday to discuss the project. He said his Bangor store has already converted from oil to natural gas.

About 30 people showed up at the North Belgrade Community Center Tuesday night to discuss the gas pipeline, which will run up the Kennebec River for about 60 miles, from Richmond to Madison.

Silkman attempted to persuade the town to approve tax increment financing, but also took a hard line with residents and officials, saying his group doesn’t need permission to move ahead with the pipeline. The Public Utilities Commission has granted preliminary approval for the project and the gas company is requesting tax breaks from the dozen affected communities to help finance the project’s cost.

The town can call a special town meeting, or wait until the June 12 primary election, to vote on the TIF.

Silkman said his group could still build the pipeline along Middle Road in Sidney, but would prefer to follow a route through a community that granted a tax break.

Silkman said if the town rejected a TIF he and the company partners would decide what the best option financially would be.

“The real estate is free; what is taxed is personal property, which is the pipeline,” he said. “That would be taxed, there’s no tax for property. We have a right under Maine law to be there, so you can’t say no” to the project.

Belgrade resident Judy Bielecki said she researched TIFs and couldn’t understand how the community of about 3,200 would fit the criteria, since there’s no large commercial industry. She also said that TIF money can only be used by a municipality for public improvements, such as road repairs.

Silkman agreed, but since the economy of the community — which includes several lakes — relies on tourism, the money could possibly be spent on recreation-based projects, he said.

“There’s an economic advantage to doing this,” Silkman said.

Some residents were concerned with safety, particularly leaks and house explosions. Silkman said his group would pay to provide safety training to the Belgrade fire department.

Others worried about their property values, and with the pipeline running along Messalonskee Lake, the environment.

Other residents said it was unfair for a private company to ask the town for a TIF when it struggles each year just to come up with the money it needs to maintain its own infrastructure.

“Ultimately, each of you will have to make a decision,” Silkman said. “There’s always folks that say, ‘I don’t think that’s OK.’ We think bringing natural gas is critical to central Maine businesses.”

Selectman Ernie Rice said people need to focus on the cost to the town.

“There’s some real savings if we do a TIF,” Rice said. “If we do a TIF, they probably won’t go back to Sidney. I think we should contact (Kennebec Valley Council of Governments) and get what tax revenues would be available to us then call a public hearing to share that information then put it up for a vote.”

The TIF proposal is for 15 years. The first 10 years, the town would receive 20 percent of tax revenues from the pipeline, and five years after that the return would be 40 percent. Beyond 15 years, Belgrade would receive all of the tax revenues, he said.

“By giving us a TIF we’re not taking any property off the tax roll,” Silkman said. “So there’s no loss of tax base. In addition, we’re providing cheaper fuel, which is a value to the town.”

He said the town would get technical assistance from the council of governments, which also could provide an analysis of what the town would receive in revenue.

Silkman said the pipeline would be constructed in 2013. Natural gas would be delivered to customers that same heating season.

Augusta, Fairfield, Gardiner, Oakland, Hallowell, Skowhegan, Norridgewock and Waterville have already approved a tax break for the gas company.

Mechele Cooper — 621-5663

[email protected]

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