August 31, 2017
Maine

Franklin County drafting new TIF application

Donna Perry, Staff Writer | Sun Journal | August 31, 2017 | www.sunjournal.com

FARMINGTON – Franklin County has withdrawn its amendment application to its 2008 tax-increment financing agreement connected to the 44-turbine Kibby wind energy facility in northern Franklin County.

The facility is on Kibby Ridge in Kibby and Skinner townships near the Canadian border.

The county recently hired attorney Shana Cook Mueller of Bernstein Shur Law Firm in Portland who is working on a new draft amendment application. The draft is expected to go before Franklin County commissioners in September.

“We want to get this whole thing to public hearing by the end of (September), county Clerk Julie Magoon said Thursday.

Commissioners had accepted an amendment to the TIF it had with TransCanada Maine Wind Development Inc. in October 2016. It was subsequently submitted to Maine Department of Economic and Community Development for review.

There were some questions and concerns raised by the state in regards to the amendment to the credit enhancement agreement and development program, Magoon said.

Commissioners decided to withdraw the amendment application and to have a new one drafted, she said.

Since the amendment application was submitted, new projects have come to light and a couple of new categories where TIF funds can be spent will be added in the new amendment, Magoon said.

The TIF targets economic development in the unorganized territory area in Franklin County.

Cook Mueller is currently working with an attorney representing the new owners of the Kibby facility, Helix Generation LLC, an affiliate of LS Power Equity Advisors, Magoon said.

TransCanada Corp. announced on June 5 on its website www.transcanada.com under the media menu option that it had completed the sale of its remaining U.S. Northeast merchant power generation assets to Helix Generation, LLC, an affiliate of LS Power Equity Advisors, for approximately U.S. $2.1 billion. Kibby Wind and three other power facilities that collectively produce 4,000 megawatts were part of the agreement and sale.

If the state had approved the amendment application that the county has withdrawn, the county stood to collect about $16.4 million over the 30-year life of the TIF.

The amendment would have extended the original 20-year TIF district to 30 years, until 2038.

It also would have allowed the county to do more public projects in the unorganized territory and to try to attract new businesses to the territory through a better-funded revolving-loan program.

The existing Credit Enhancement Agreement the county has with TransCanada will expire after the original 20 years in 2028. The existing agreement caps the county at collecting $4 million over that period and the Canada-based company at $8.9 million.

Currently, the county captures 75 percent of TIF tax revenue and sends 25 percent to the state for the unorganized territory for the first 10 years. In the past 10 years of the agreement, the county was slated to capture 50 percent of the new tax revenue and sends 50 percent to the state.

Of the 75 and 50 percent amounts, TransCanada received 60 percent, and the county, 40 percent.

The amendment would have allowed the county to capture 100 percent of the new tax revenue with the 60-40 percent split staying intact. If the amendment had been approved by the state, the 100 percent capture was to begin on April 1.

The amendment proposal also called for from 2029 to 2038, all TIF revenues go to the county and no TIF funds will be sent to the state.

The amendment would not have changed the Community Benefit Agreement TransCanada had with the town of Eustis. The company has given the town about $132,000 a year for the past eight years.

The Maine Department of Administrative and Financial Services raised concerns about the proposed amendment and agreement in October 2016 before the hearing and at the hearing.

There was also an economic enhancement agreement between the county and TransCanada, which was separate from the TIF.

That agreement would give the county approximately $3 million more from TransCanada. Those funds would be spent throughout Franklin County while the TIF funds need to be spent to benefit of the unorganized territory.