MADISON — Selectmen made plans Monday night to pursue legislation that would provide tax relief in the form of educational funding and help mitigate the impact of a $150 million drop in value at Madison Paper Industries.

The topic is expected to be a major point of discussion during a joint meeting with the Skowhegan Board of Selectmen on Nov.24, at the encouragement of Bill Van Tuinen, assistant to the board of assessors in both towns.

“I certainly think there’s a great deal in common between the two towns and that it would benefit both in working together on legislation,” said Van Tuinen during Monday’s selectmen’s meeting. He also encouraged the board to pursue hiring a lobbyist to advocate before the state Legislature, something he said could “cost a lot but still be cost effective.”

State funding for education is based on the average state valuation of a community over the last three years, which is something that could hurt both Madison and Skowhegan as they face drops in the tax values at local paper mills, said Van Tuinen. In October, the board of selectmen voted to appeal the town’s state valuation, proposed at $491.6 million, on grounds that it does not accurately reflect the loss at the mill.

Skowhegan selectmen are also considering an appeal of their state valuation following a $100 million drop in value at Sappi Fine Paper. Meanwhile, selectmen in Madison are continuing to work on finalizing a resident-approved plan to mitigate the impact of the loss in value at the mill on the local tax rate, including establishing a $2.5 million line of credit.

Since sending out requests for proposals to four area banks, the town has received proposals on the $2.5 million loan they are seeking from Bangor Savings Bank and Skowhegan Savings Bank. On Monday, the board heard from representatives of Skowhegan Savings, who presented them with an option for a seven-year loan with a 3.5 percent interest rate.

Bangor Savings Bank has presented the town with a proposal for a six-year, 3.19 percent interest rate loan. There were no representatives from Bangor Savings at Monday’s meeting.

“It’s a lot of stuff here,” said Al Veneziano, chairman of the board of selectmen. He proposed that the board put off making a decision on the loan until they hear from representatives from Bangor Savings. There is no deadline for when the line of credit, which was approved by residents in September, must be established, and the town currently maintains a $2.5 million fund balance.

The line of credit will be revisited at the next selectmen’s meeting on Nov. 24.

In addition to establishing the $2.5 million line of credit, residents in September also approved using $800,000 from the town’s savings account to offset the tax rate. The tax rate was set at $19.50 per $1,000 of assessed value in September, an increase of about 11 percent.

Rachel Ohm — 612-2368

rohm@centralmaine.com

Twitter: @rachel_ohm