LIVERMORE FALLS — Selectmen will hold a public hearing on Tuesday, Jan. 21, on a tax-increment financing application to capture some of the new value of Central Maine Power’s substation upgrade.
The hearing will be held at 6:30 p.m. at the Town Office.
A TIF is an economic development tool used by municipalities to capture new real estate value, shelter the new tax revenue from the state’s calculation of general purpose aid for education and revenue sharing and the county tax, and use the revenues locally to fund economic development programs and infrastructure projects that support the growth of commercial enterprises, according to information provided by consultant John Cleveland, president of Community Dynamics Corp. of Auburn. The town has hired the firm to help with the development of the application.
The TIF agreement would allow the town to capture 90 percent of the new valuation of a $17 million CMP substation upgrade on Moose Hill Road over 30 years. The remaining 10 percent would be assessed taxes that would go into the town’s general fund.
Central Maine Power Co. would not benefit from the TIF, only the town.
The creation of a TIF district would allow the town to shelter 94.8 percent of the new revenue from the state and county, Cleveland’s information states.
“If a district is not created to take advantage of the new CMP investment, the town would only retain 48.8 percent of the new revenue,” Cleveland said.
Consultants recommend terminating the old, inactive Otis Mill TIF approved by voters in 1996 before the creation of the new TIF. Wausau Paper closed the paper mill in 2009.
The mill that straddles the Livermore Falls-Jay line is currently owned by Otis Ventures LLC in Jay. Several businesses now call the complex home.
The portion of the mill in Livermore Falls is one area that is proposed to be included in the TIF district. Other areas include the downtown area, properties on Park Street and Diamond Road near the biomass plant.
According to Cleveland’s information, if the TIF is approved by Livermore Falls voters and the state, in the first year, 2014-15, the town would capture $5.4 million of the assessed value of $6 million. Using the current tax rate of $20.80 per $1,000 of valuation, the projected new taxes captured are $112,320 with the town’s TIF revenue being $112,320 and the revenue to the general fund would be $12,480.
By 2043-44, it is projected that the value of the upgrade would increase to $19 million and based on the current tax rate, the captured assessed value would be $17.1 million. The projected new taxes would be $355,680 with the town gaining $355,680 in TIF revenue and going into the general fund would be $39,520.
Over the 30 years, the town would gain a projected $10.22 million of revenue and $1.13 million would go into the general fund.
Voters will be asked to consider the application on Feb. 10.
dperry@sunjournal.com
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