Orrington selectmen act to amend TIF rules

ORRINGTON – It’s not a big change, but by amending the town’s tax-increment financing guidelines the community could save a significant amount of money, town officials say.

After a lengthy discussion during a selectmen’s meeting Monday, the board decided to amend the current ordinance by adding a paragraph that would allow the town to “shelter” new property values from the state for up to 30 years.

Ron Harriman, Orrington’s economic development consultant, said current guidelines didn’t explicitly say the town could shelter the money. Selectmen thought “it might be prudent” to clarify the ordinance, he said.

The amended guidelines will be presented to residents during the June annual town meeting for final approval.

“It really makes no sense not to,” Town Manager Carl Young said Tuesday.

With the amended ordinance, the town could shelter new property valuations from the calculations of state revenue sharing, education subsidy and county tax assessment for projects that have TIF agreements. This would in effect create more money for the town that must be used for community economic development.

One example of how the town would benefit from the amendment is demonstrated with the new Orrington Plaza shopping center project, which was given a 10-year TIF for 50 percent of the new property value. That was approved by residents at last year’s annual town meeting.

“What it will do is save $104,000 over the period of the TIF,” Young said of the plaza project. “It gives us a chance to build infrastructure without taxes going up.”

Without the amendment, the town would see an increase in valuation created by the new shopping plaza, which would reduce its share of state revenues and increase county taxes.

“It is a win-win situation for the town,” Harriman said.

The state allows TIFs of up to 30 years. In the case of Orrington Plaza, after the 10-year TIF expires, the town could shelter 100 percent of the value from the state for the remaining 20 years, if the amendment is approved by residents, Harriman and Young said.

During the meeting, the board also:

. Hired engineer Bill Olver of Winterport and Kleinschmidt Associates of Pittsfield, a firm that specializes in hydro dams, to inspect the Swetts Pond dam and make recommendations for any repairs.

. Heard a recommendation from the town manager to sell the current town hall if the decision is made to construct a new facility. The money from the sale would be used to offset the construction costs.