JAY — The town has been through many ups and downs with paper mills over the past decades.
Following Pixelle Specialty Solutions’ announcement Tuesday it would close the Androscoggin Mill in early 2023, town officials have been at work trying to develop a plan to get the town through it.
It is the second and last paper mill in town that will close. The Wausau Paper Otis Mill, which straddled the Jay/Livermore Falls line, closed in 2009.
“We have endured paper machine shutdowns, multiple layoffs and a digester explosion at the mill over the past years and it does not get any easier, but we will take the steps we have taken before,” Town Manager Shiloh LaFreniere wrote in an email Thursday.
“We will begin the process of applying for Sudden and Severe Valuation disruption in value through the state of Maine. As in the past, it will put us in a position to receive additional revenue-sharing and educational subsidy funding as well as a reduction in our county tax, she wrote.
“We will also continue to manage our municipal budget in a fiscally responsible manner, looking for efficiencies where we can and making hard decisions about the level of services we are able to provide,” she wrote. “We are fortunate that we have had a Select Board and citizens that have recognized the need to maintain a healthy undesignated fund balance to be able to help offset the immediate impact of such a valuation loss.”
If selectpersons approve filing for a state reduction of valuation, it could be the fifth time since 2013 where the state could lower the town’s valuation due to changes at the mill.
During past legal challenges between the town and past mill owners, International Paper Co. and Verso Corp., there were disagreements over pollution control equipment exemptions and overvaluation and overtaxation. In 2016, the town and Verso reached an agreement to resolve valuation and tax disputes for the 2013, 2014 and 2015 tax years on the company’s Androscoggin Mill and associated property.
Selectpersons agreed in April 2016 to give Verso a credit of $4 million over the next three tax years in six credits to settle the dispute.
Verso had filed a motion with the U.S. Bankruptcy Court in Delaware in March 2016 asking the court to settle the valuation of the mill for the three years. Verso claimed the town owed it a tax refund of $11.4 million plus interest for overvaluing and overtaxing the company’s Jay property.
The town disagreed.
The town tightened its budgets to be able to try to absorb the $4 million settlement.
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