Oakland’s portion of the Summit Natural Gas pipeline may not be worth as much as town officials hoped, Town Manager Peter Nielsen said Monday.

Nielsen said he will provide the public and the Town Council with an update on the project’s assessed property value Wednesday.

At the same meeting, scheduled for 6 p.m. in the Williams Elementary School cafeteria, the town will hear from residents on whether to capture tax revenue generated by the pipeline in a tax increment financing district.

If residents favor the district, Nielsen said, the council could approve it immediately. If what they hear raises concerns, the matter will likely be tabled until a future meeting.

If the district is approved, property tax money is directed to projects approved by the town with restrictions on its use. The TIF money can only be spent on a narrow range of options associated with economic development.

Nielsen said the money could be spent on the town’s annual dues to the FirstPark technology business park, about $47,000 each year. He said it could also be spent to make physical improvements to roads that the pipeline travels along, with Country Club Road being discussed as a priority.

Other potential uses of smaller amounts of money could include buying public safety equipment, training and development of the town’s comprehensive plan, a process that can cost about $25,000, Nielsen said.

TIF districts are becoming increasingly popular in central Maine, with towns creating such districts to capture value associated with the pipeline or with other geographic areas within their borders. Nielsen said he knew of only one other TIF district in Oakland, which is associated with FirstPark.

The pipeline comes into Oakland from Waterville on Webb Road and travels west to Country Club Road, where it turns north and comes up to Kennedy Memorial Drive. Oakland’s six-mile portion of the pipeline then turns west on Old Waterville Road and runs up Fairfield Street before continuing north out of town toward Skowhegan and Madison.

The town crafted a project budget based on an expectation that the pipeline would generate a certain amount of revenue, but it now appears that may not be the case, Nielsen said.

He said he received a letter from Summit that provided some assessment figures “that we’re in the process of understanding.”

Nielsen said he wanted to have a better understanding of the complex details of the letter before he commented on it publicly.

“We’re not prepared to speak about that at this time,” he said.

But he did say that his initial understanding is that the valuation is “not in line with expectations.”

Nielsen said there is a sense of urgency surrounding the creation of the district because the paper work must be processed by July 1, the town’s property assessment date.

If the district is approved after that date, he said, the town would have to wait a year before getting the financial benefit of the TIF designation.

The public hearing is a required part of the process to create a TIF district. If approved, the district would last for 10 years, although it can be extended or abolished by the Town Council at any time, as long as a public hearing is held first.

During Wednesday’s meeting, the Town Council will consider bids for paving and a replacement police vehicle. It will also consider an estimated $400,000 budget for the sewer department. No rate increase in that budget is anticipated.

Matt Hongoltz-Hetling — 861-9287

mhhetling@centralmaine.com

Twitter: @hh_matt