SKOWHEGAN — The new Somerset County board of commissioners voted unanimously Wednesday to sign a letter of support for the towns of Skowhegan and Madison to convince state officials to reduce each town’s state valuation for 2015 to reflect the lost value of the towns’ paper mills.
Newly elected county commissioners Newell Graf, of Skowhegan, and Dean Cray, of Palmyra, were sworn in prior to the meeting Wednesday, along with incumbent Commissioner Lloyd Trafton, of West Forks, who was reelected in November.
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The men join commissioners Robert Dunphy, of Embden, and Philip Roy, of Fairfield, on the five-member panel. Dunphy was reappointed commission chairman. Graf was appointed vice chairman.
Bill Van Tuinen, the assessors’ assistant for both towns, told commissioners that the value of the Madison paper mill has been reduced by about $149.7 million, or 65 percent, while the value of the Sappi mill in Skowhegan has been reduced by $100 million, representing 18 percent of its taxable value.
“It’s a tough situation,” Van Tuinen said. “The paper industry is not doing as well as it once was. More and more the digital world is making inroads into communication.”
He blamed the drop in valuation on obsolescence.
Both towns have appealed their state valuations to the state Board of Property Tax Review, but bills are coming due and action has to be taken soon, Van Tuinen said.
A joint meeting of the boards of selectmen from Skowhegan and Madison, along with other elected officials, is set for 7 p.m. Thursday at the Old Point Avenue school in Madison. The public is invited to attend, commissioners said.
The state valuation is the basis for the determination of school subsidies from the state and the amount of county taxes to be paid and is a big part of the formula for allocating state revenue sharing, Van Tuinen has told selectmen in both towns.
A higher state valuation means that more funding for education comes from local taxpayers and less from the state, he said. The towns also would contribute a higher percentage of the county tax with a higher valuation and receive less in state municipal revenue sharing if state valuations are not adjusted.
State valuation generally lags two years behind the local valuation, Van Tuinen said, meaning that the state valuation for Madison and Skowhegan for 2015 would still be based on 2013 property assessments — before the drop in valuation of the paper mills.
If the town’s valuation is not adjusted to reflect the reality of each of the paper mills’ valuation, Skowhegan and Madison taxpayers would pay county taxes and receive school funding and revenue sharing funds based on the proposed state valuation — which doesn’t take into account the loss in value of the mills.
The vote of support for the towns Wednesday would help speed up the adjustments in the towns’ valuation and not make each community wait two years to get relief, commissioners hoped. Van Tuinen said a petition to the state tax assessors for a reduction in the state valuation can be considered a financial emergency because the drops in value for taxation have been sudden and severe.
Commissioners agreed to back off slightly from a formal resolution seeking legislative changes to send to the state Legislature because “place holders” have been filed that can be replaced with specific wording for consideration during the new session.
Van Tuinen has said in previous meetings that there are examples of the Legislature granting valuation relief to specific towns that have faced losses in their tax bases after town officials proved they examined other available avenues of relief, including an appeal to Maine Revenue Services.
“So I am cautiously optimistic that such efforts might be approved by the Legislature,” Van Tuinen said in the letter to the town boards last year.
Van Tuinen and Commissioner Philip Roy of Fairfield also cautioned that adjustments in the valuations of Skowhegan and Madison would shift the burden of meeting the Somerset County budget to the other municipalities. Roy said he wants to see exactly how each of the towns in Somerset County would be affected by the shift in taxation, including his own town of Fairfield.
Doug Harlow — 612-2367
Twitter: @Doug_Harlow
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