MADISON — Selectmen are considering seeking a third party to reassess the value of Madison Paper Industries following an initial assessment that significantly devalued the mill, possibly increasing residents’ property taxes by roughly 30 percent.

Selectmen are also planning to approach members of the state Legislature about legislation that could offset the impact of the $150 million loss in the mill’s value, the town’s largest property tax payer in 2013.

“We are looking at all avenues we can to minimize the impact on the tax rate — revenues and expenses, TIF funds if we can use them and establishing a line of credit,” said Town Manager Dana Berry.

During a selectmen’s meeting Monday night, several people expressed concern that the $80 million assessment of the mill, previously valued at $229.7 million, was not fair and that the town should have hired a third party to do the assessment, which was done by the town board of assessors and their assistant.

“No one ever anticipated a drop of this size,” said Selectman Paul Fortin. “I think it’s substantial enough that it does require (reassessment), but we also have to realize that it could come back at $50 million or $150 million.”

Selectmen said they were notified that the value of the mill would change by a “significant and substantial” amount early in the year, but it was not until Aug. 11, after school, county and town budgets were passed, that the board of assessors notified them of the $150 million change. If no action is taken, the tax rate is expected to jump from $17.30 per $1,000 of assessed value to about $23 per $1,000.

With the help of the Maine Municipal Association, the board has drafted legislation asking that the state value Madison Paper Industries at $80 million for the purpose of calculating state municipal revenue sharing funds and for distributing state aid to the local district.

According to current state law, it takes two years for the state to update valuations and three years for the number to go into use by the Department of Education for purposes of local school funding.

Madison is not the only community that could be affected by a change in valuation of the local paper mill. Nearby Skowhegan has appropriated money for an independent valuation of the Sappi Fine Paper mill.

It will be hard to pass legislation before next spring that could alleviate the situation in either town, said Rep. Ann Dorney, D-Norridgewock.

“The big question is whether the valuation is fair and whether there is more information about whether the mill is at risk for closing or just how dire of a situation they are in,” said Dorney. “It seems like an awfully big devaluation, and there are a lot of unhappy people. There are a lot of people with fixed incomes that can’t afford this.”

Tax bills were originally scheduled to go out Sept. 1, but the date has now been pushed back. Commitments will now be set on Sept. 22. Taxes are due 30 days after commitment. The town is also considering borrowing money so that they can raise the tax rate in increments over the next several years.

“I am certainly aware of it being an issue, and we are being as active as we can in finding options for the town,” said Sen. Rodney Whittemore, R-District 26. “I don’t know yet what can be done, but we are researching what course of action can be taken.”

Rachel Ohm — 612-2368

rohm@centralmaine.com