KINGFIELD — Selectmen learned more Monday night about the uses of tax revenue generated by Poland Spring Water Co.’s bottling plant.
Five years ago, Kingfield designated most of its downtown as a development district, with plans to use taxes from the new Poland Spring plant to assist in that development. In a state-approved financing plan known as Tax Increment Financing, the new property taxes generated could be captured and sheltered.
Once the district was established, Kingfield’s tax assessor calculated the original assessed value of all property within the defined district. That valuation became a benchmark to compare with future assessed value. In order to meet state requirements, the town hired the Bangor-based Eaton Peabody Consulting Group to structure the 30-year agreement.
On Monday night, two representatives from the company reviewed the plan and changes that might benefit the town.
Typically, when a town has a significant increase in valuation, real estate valuation and county taxes go up and state subsidies go down, consultant Raegan LaRochelle said. The TIF agreement froze the valuation of that downtown section and allowed future taxes to go into a town-managed TIF fund. Each town’s agreement is different and tailored to the town’s and the company’s needs, she noted, and lengths of the agreements and percentages of taxes captured can vary and can be amended.
“Sometimes, the municipalities can have the district’s money going back to the business for the first 10 years and to the town for the next 20 years,” she said.
The difference in value before and after the Poland Spring bottling plant was constructed allowed the town to shelter its increased valuation from increases to Franklin County and decreases in state education subsidies and revenue sharing.
In Kingfield’s agreement, the town also approved a Credit Enhancement Agreement, which allows Poland Spring to show a better “bottom line,” according to attorney Jonathan Pottle. The town and company negotiate the tax break to benefit both.
In other news, new school board director Beth Luce shared the information about reconfiguring the board, which the school board discussed last week. She said if the Reapportionment Committee decides to add more members, due to the withdrawal of Eustis from RSU 58, it could mean five from Strong, four each from Kingfield and Phillips, and two from Avon.
A 15-member board will increase diversity and ensure that towns won’t depend only on a single representative, she said.
Many of the board’s concerns were dependent on the financial background and structure of the district. The board may decide to change the structure of the current system, and Luce hopes to hear from constituents about their preferences. Students could go to a single campus location at Mt. Abram High School, or they could consider having two elementary schools and a high school. No decisions will be made without significant input.
“The school board requested fiscal data from Superintendent (Brenda) Stevens,” she said. “I’ll get that to you.”
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