Corporate energy giant TransCanada is appealing the property value assessment of their Bellows Falls hydroelectric dam, seeking to reduce the property’s value by $22 million, from about $108 million to $86 million.
TransCanada first filed a grievance notice on June 7 with Rockingham town’s Board of Listers for their Bellows Fall station at 20 Mill St. The notice details TransCanada’s analysis of the property’s value, which argues that falling energy prices among other factors make the dam less valuable.
Camilla Roberts, chair of the Board of Listers, described TransCanada’s case as “critique” of a 2010 state-funded and approved appraisal of the property. The company, she said, failed to provide an alternative independent appraisal.
On June 20, town listers decided not to allow the reduction in market value, after hearing TransCanada’s case about a week and a half ago. TransCanada is now appealing that decision with the town’s Board of Civil Authority (BCA), which will hear the case on July 17, and then make a decision within 30 days.
The dam in Bellows Fall village accounts for almost half of the property tax base, while in Rockingham it accounts for a third, Roberts said.
If TransCanada gets the proposed reduction, it would result in a total tax revenue loss of $640,000, which would have to be made up by other taxpayers.
“It’s all very intense,” said Roberts. “It’s an unstable situation, and we haven’t yet been able to find a way to stabilize that tax impact. Tax money is how work gets done in this town, and we’d have to compensate for a loss of revenue: services and budgets would be cut.”
“One hiccup or sneeze on that tax value, and the whole tax revenue system for the village swings wildly,” said Roberts. “It’s just incredibly important.”
TransCanada spokesman Shawn Howard responded that the company had an obligation, both as a taxpayer and a company, to pay the right amount of taxes based on an accurate appraisal.
“It’s unfortunate that there were issues in how this dam was assessed in the past, which created certain expectations,” said Howard. “We recognize that there are some impacts on budgets, but we have to make sure we’re paying an accurately assessed tax value. We’d also like to see this addressed as quickly as possible.”
Town officials say the drastic reduction in revenues would result in cuts to services and municipal employees, and less assistance would be available to other organizations in town.
“Our budgets are extremely tight as it is,” said Tim Cullenen, Rockingham’s municipal manager. If TransCanada won their appeal, he said, “very hard decisions would have to be made.”
There is also the threat of possible litigation if TransCanada is unhappy with the BCA’s decision. In the past, TransCanada has sued Littleton, N.H., and Concord, Vt., over dam property values. The company won its case in Concord.
Although both Cullenen and Roberts declined to comment directly on the likelihood of future litigation, Cullenen did say: “We’re talking a serious sum of money: It’s not likely that they’re just going to change their direction and say OK.”
The current appraised value of the dam, at $108 million, was based on a 2010 state-funded appraisal of all eight Vermont hydroelectric dams, conducted by utility consultant George Sansoucy P.E., LLC. The appraisal cost the state about $200,000.
In 2005, when TransCanada first bought the property, company vice president William Taylor also made promises in a letter to the town, in exchange for allowing the purchase to go through, including a payment of $42 million over 12 years, no matter the tax value of the property. Roberts said TransCanada has not delivered on that promise though it was not included in contracts or notarized documents associated with the sale. The statements may have been made for publicity’s sake, she said.
Though town officials seemed open to the possibility of negotiating after the BCA decision, TransCanada spokesperson Howard said he could not say either way whether negotiations were still an option at this stage.
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