Town asks state board to reconsider GNP tax refund

EAST MILLINOCKET – East Millinocket is asking the State Board of Property Tax Review to reconsider its decision to grant Great Northern Paper Inc. a tax refund of $557,329.

Great Northern is asking the state board to deny the town’s request.

The state board has tentatively scheduled a hearing for Aug. 29 to discuss the town’s request, according to Michelle Robert, an assistant attorney general representing the board.

On July 8, the state board granted Great Northern a tax abatement of $33.37 million, setting the 1999 value of the company at $170.75 million. The town had assessed the company at $204.12 million.

The $33.37 million tax abatement translates into a refund of $557,329 plus interest of 8 percent per year. GNP will pay a substantial portion of the tax refund, about 75 percent of it or $417,996, according to officials representing the town.

The town’s request for reconsideration comes before the state board has issued a written decision. Robert said the board has not rendered a written decision but is working on it. Last month’s decision was verbal.

Lee Bragg, an Augusta attorney representing the town, said officials left the July hearing feeling the state board had made a mistake.

On several occasions during deliberations, board members expressed concern that GNP’s appraiser used an appraisal methodology for the machinery and equipment that assumed and reflected significant and severe depreciation for mill assets, yet the board failed to readdress these concerns in its decision, according to the motion filed by Bragg.

The motion for reconsideration points to several areas where the figures of the company’s appraiser were significantly lower than in several other appraisals and indicates that the company’s appraiser excessively adjusted obsolescence on machinery and equipment to the point where it was depreciated twice.

“We felt there was overwhelming evidence in favor of the original cost numbers we had used and the depreciation methodology we had used,” said Bragg. ” This motion is an attempt to outline all of that evidence in the hope that the board will take another look at it and make a change in their decision.”

The town’s attorney said there was no specific procedure dealing with motions for reconsideration but said the board is entitled to make any decision it wants to up until it renders a final written decision.

Brian Stetson, GNP’s manager of governmental affairs, declined to comment on the town’s request. He said company and town officials have held one “productive” meeting on the tax issue and plan to meet again to continue their discussions.

Meanwhile, last week the town filed an appeal of the board’s decision in Kennebec County Superior Court.

Bragg said the appeal was only filed to preserve the town’s right of appeal. He said the law was not clear on whether the appeal must be filed 30 days from the date of an oral decision or the written decision.