Fraser Papers Inc. eyes tax cut, BETR removal

MADAWASKA – Gov. John Baldacci met with Fraser Papers Inc. union officers Wednesday afternoon who touted future legislation for removing the Business Equipment Tax Reimbursement program that would also cut personal property taxation by the community.

The BETR program presently allows communities to tax business and industry personal property, but the state reimburses the industry for the personal property tax it pays.

Under legislation proposed in the last session and a new bill that will be proposed in the next Legislature, towns would be reimbursed for personal property now on the books. The legislation would cut the reimbursement 75 percent in 2007 and to 50 percent in future years.

He said the proposal is meant as an incentive for companies to invest while protecting them from personal property taxes. Towns, he said, will see the money made up by more money coming to the towns for things such as education.

He asked union officials to support the measure and for them to ask their members to back the proposal as well.

“It will help attract more investment into the state, from business and industry, and that will create work in Maine communities,” he said. “We need to have communities recognize that we have to repeal the BETR program over a period of time.

“This affects industry and jobs,” he said. “Our administration has been trying to preserve and grow jobs from day one.”

After meeting with union officials, Baldacci, Commissioner Patrick McGowan of the Maine Department of Conservation and Jack Cashman, commissioner of the Department of Economic and Community Development toured the Madawaska papermaking plant.

Later they were meeting with Fraser officials at the company’s annual dinner at Madawaska. The press and the public were not allowed at that session.

The governor said he was there to tout investments in Madawaska by the company. He said he had already talked with Dominic Gammiero, president of Fraser, and was following up on those talks Wednesday night.

Baldacci’s visited Fraser Wednesday when the company hired 14 new workers. New hirings have been remote since Fraser decided to cut one-third of its jobs in Madawaska since 1995.

The 1995 work force of more than 1,200 people has been downsized to 800 since then.

Rosaire Pelletier, comptroller of Fraser, said at the meeting that future major investments at Fraser will need local support through a Tax Increment Financing plan used by other Maine paper companies.

Cashman told workers that the new legislation will need the support of management and labor. He said future tax losses by communities will be refunded at 50 percent of the tax loss.

“We are trying to grow business in Maine,” Baldacci told union personnel. “We have a good track record of saving jobs in Maine since we have been in office.”

Workers questioned the governor on infrastructure development in northern Maine, specifically a road system that serves Madawaska, the industrial center of the St. John Valley.

He said projects are on the books and working their way through the system. He said the north-south highway is more advanced than the union mentioned east-west project in central Maine.

The governor and his entourage also attempted to defuse “the perception” that Maine is not conducive to business. They said workers’ compensation costs have gone down and that medical costs are in the middle of the pack nationwide.

“We have the lowest cost of doing business among the New England states and New York,” Cashman said.