Biddeford to extend tax break for Nissen Baking Co.

BIDDEFORD — The City Council has agreed to extend the tax break it previously granted to the owner of the J.J. Nissen Baking Co., which wants to expand the plant it built last year.

The new agreement means that Interstate Bakeries Corp. of Kansas City, Mo., will save $1.3 million in taxes over the next decade on the proposed $15 million expansion.

The city previously agreed to return $950,000 of the $1.25 million in taxes that Interstate is expected to pay over the next two years on its $33.8 million plant near Exit 4 of the Maine Turnpike.

The plant, which employs 550 people, is the largest of the 67 that IBC operates throughout the country. It bakes Nissen breads and Hostess cakes for distribution throughout the Northeast.

The expansion would include a trucking depot, a thrift store for bakery products produced at the plant and an employee credit union.

Company officials were pleased at the outcome of the Oct. 19 meeting, even though the council opted to exclude the credit union from the tax increment financing agreement.

“It’s only a small part of the proposed expansion,” said IBC financial consultant Anthony Gudas. “We’re pleased that the city has decided to continue its partnership with IBC.”

Critics in the audience denounced the TIF extension as an example of “corporate welfare” and said there was no need for the city to give a second tax break to the nation’s largest baking company.

“This is not a cash-poor corporation,” said Richard Rhames, a City Council candidate. “This is a big, wealthy corporation.”

City officials said the TIF agreement is good for Biddeford because it brings added development while keeping state subsidies at current levels for schools and other programs.

Over the next 10 years, IBC will pay a total of $2.8 million in taxes on the proposed new construction, said City Manager Bruce Benway. The TIF will cut Nissen’s taxes by 45 percent.