How Much Property Tax Would Northern Pass Actually Pay?

PSNH is currently trying to slash its utility assessments by 50% or more in 56 NH municipalities, mostly small towns, thereby reducing the property taxes it must pay and forcing residents to pay higher property taxes to make up the shortfall. More appeals are expected for the 2013 tax year. Northern Pass claims it would contribute "an estimated $28 million in new local, state, and county tax revenues." Would Northern Pass also appeal its assessments and try to slash the property taxes it pays to NH towns?  2/10/2014 Utilities Fight Property Tax Bills Across State

Robert Blechl Staff Writer Caledonian Record North Country towns swamped with utility property appeals face a long fight that will decide whether big utilities can slash their taxes in half or more and leave residential taxpayers making up the millions lost through higher property taxes. One of those cases, filed at Grafton Superior Court by the New Hampshire Electric Cooperative (NHEC) against Haverhill and other Grafton towns, had been scheduled for trial in February, but has now been continued to June. As of Friday, Public Service of New Hampshire (PSNH), represented by the same attorney as NHEC, is suing 24 percent of New Hampshire's municipalities through appeals that have been continued to 2015, when they are expected to be heard at the New Hampshire Board of Tax and Land Appeals. In their appeals, PSNH and NHEC seek to use the Department of Revenue Administration's 83-F appraisal reports, the state's utility property tax statute that sets the utilities' contribution to the state education tax. Towns, however, argue the 83-F formula is used for one purpose only, does not represent a true property value and the utilities are misusing it in an attempt to drive their assessments below fair market value. To date, PSNH has a total of 87 appeals against 56 of New Hampshire's 234 municipalities, most of them small towns, according to the BTLA list. Those appeals, most for the 2011 and 2012 tax years, include the towns of Bath, Dalton, Gorham, Haverhill, Lancaster, Landaff, Lincoln, Littleton, Plymouth, Randolph, Stark, Stewartstown and Whitefield. A more recent appeal thrown into the mix is Littleton, which has a tax base of $759 million. In Littleton, PSNH, for tax year 2012, seeks to cut its assessment in half, from $21.9 million to $11.3 million, according to its appeal. "Half of a $21 million assessment in a town like Littleton would be a devastating burden and real challenge to taxpayers," said Selectman Marghie Seymour. "Here we are working as hard as we can to up our valuation by a million here and a million there and they are trying to take away $11 million." As a selectman, Seymour said she doesn't begrudge anyone their right to challenge whether they feel their assessment is valid or not. "But more and more often, it feels like the utilities are ganging up on the towns that don't have the money to fight," she said. "On the one hand, they say we will see all these tax benefits from Northern Pass to North Country communities and on the other hand they are participating in what appears to be a concerted effort to give as little to the towns as they possibly can." Littleton Town Manager Fred Moody said, "Our plan is to work with the other communities in the state. Certainly, the situation in Littleton is not much different." In Whitefield, for tax year 2011, PSNH seeks to slash its taxable real estate by more than half, from $12.9 million to $5 million, according to that appeal. In Haverhill for 2012, it seeks to reduce its assessment from $4.6 million to $2.8 million. In Dalton for 2011, PSNH seeks to reduce a $3.7 million assessment to $1.2 million. In Lancaster for 2011, PSNH seeks to cut its assessment from $7.38 million to $3 million. In terms of percentage, Landaff, with a tax base of $51 million, would see one of the biggest reductions if PSNH is successful in reducing its 2011 assessment from $933,202 to $271,588. BTLA representatives said more appeals are expected for the 2013 tax year. On Friday, PSNH spokesman Martin Murray, said, "At PSNH, we always seek to pay our fair share of taxes. Ultimately, it is our customers who pay those costs, so we seek to ensure they are fair and reasonable. On behalf of our customers, and as a regulated utility, we have a duty to dispute those local valuations that are extreme outliers compared to the New Hampshire Department of Revenue's assessment of the value of our assets." PSNH pays its tax bills upon receipt, and if it disagree with the assessment, the company includes a letter stating it protests the assessment, he said. "While cases like this may ultimately be considered by the state, we typically first participate with the town in a period of mediation," said Murray. "It is our hope that the issue will be settled through that process and found to be acceptable to all." Murray declined to answer if PSNH believes the 83-F report represents the true market value of the company's properties and if PSNH customers would see reduced rates if the appeals are successful. During an October Littleton selectmen's meeting, former state Rep. Brien Ward asked selectmen to monitor the 83-F appeals and their potential impact on the town. "When statewide property tax passed in 1999, it was agreed the utilities should pay their fair share," said Ward. "But they got legislation in that heavily discounted the value. It wasn't market oriented, it wasn't income oriented. They are now trying to take what they got as a concession in 1999 and run it statewide so that becomes the standard." But the intent of the legislation is clear, said Ward, who believes the utilities have an uphill battle. In addition to superior court, NHEC has appeals before the BTLA, including one against Colebrook. In its superior court case against Haverhill, NHEC, for the 2010 through 2012 tax years, seeks to reduce its assessments by two-thirds. In those tax years, NHEC's aggregate assessment in Haverhill was $2.167 million, $2.272 million and $2.4 million, according to the company's tax abatement petition. Based on the DRA report, however, NHEC argues the market value of its taxable real estate in Haverhill was $663,141 in 2010, $701,127 in 2011, and $817,369 in 2012. Taxation is supposed to be fair and equitable and Haverhill's system is fair and equitable, while the system the DRA uses discounts the utility properties and is not, said Haverhill Town Manager Glenn English. "We're just trying to protect our tax base," said English. "To the extent they are successful, it will raise the burden on everybody else."

NESCOE on Northern Pass

The New England States Committee on Electricity (NESCOE) advises the New England Governors on energy policies. On September 9, 2013, NESCOE published a whitepaper on Canadian hydropower imports.*

Incremental Hydro Power Imports Whitepaper (Fall 2013)

 

Excerpt on Northern Pass

New Hampshire public officials note that the Northern Pass proposal faces significant hurdles to  its implementation in its current form. Organized grass-roots opposition by citizens, advocacy groups and state and local elected officials, has led to apparent bipartisan opposition to the project in the New Hampshire Legislature. As of August 2013, proposed bills designed to modify the features of (or prevent the building of) Northern Pass have been introduced in the New Hampshire Legislature. If these efforts are not successful, litigation against the project is likely to follow. Objections against the project center around the potential visual impact of transmission towers on scenic areas of northern New Hampshire, the associated impacts on property values and tourism in the communities along the proposed route, and the belief that the power provided is not needed by New Hampshire, and would be sent to southern New England. (p. 32 n51)

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*The link to this study is posted on NESCOE's home page.

"Northern Pass: No Exchange, No Returns"

Guest commentary by Nancy Martland, Sugar Hill, published by the Laconia Citizen, 12/27/2013, and republished here with permission.

 

 

 

Northern Pass: No Exchange, No Returns

By Nancy Martland

 

It’s happened to all of us.  You’re given a beautiful package wrapped in shiny paper with pretty ribbons that you just can’t wait to open. Inside you find a tangerine and purple sweater with a lime green teddy bear appliqué in a size you haven’t worn for at least 20 years.  After a moment of stunned silence, you automatically thank the giver -- it’s the thought that counts, right? Yet, all the good intentions in the world cannot change the fact that this gift is not right for you.

 

It is for this reason that the customer service window was invented by stores that value customer satisfaction and loyalty.  There you can exchange that tangerine job for a nice black wool crew neck that fits and you feel comfortable wearing.

 

About three years ago, New Hampshire received a package from Northeast Utilities, called the Northern Pass.  It was wrapped in pretty paper, and presented to us with a flourish as the best deal we were ever going to see.  Once we had it open though, we realized that it didn’t fit, and we didn’t much like it. The shiny wrappings covered unappealing features that made us decide we had to return the package.

 

Only Northern Pass didn’t have a customer service window. They insisted that we keep it whether we liked it or not.  It seemed Northern Pass has a “no returns, no exchange” policy, and New Hampshire is pretty much stuck with whatever white elephant “gift” they want to give us.

 

What was concealed beneath that shiny paper?

 

Massive towers through 187 miles of New Hampshire’s signature landscape, our mountains and valleys, our towns and neighborhoods. And just to be clear, we are not talking about a few telephone poles. We are talking about more than 1500 metal lattice towers. With a 30 X 30’ footprint including poured concrete footings, they range from 90 to 135+ feet in height, reaching far above our tallest trees to dominate the landscape. Northern Pass reassuringly told us we would “get used to” these monsters.  Kind of like the returns clerk telling you, “Oh, we can’t exchange that. You’ll get used to that lime green teddy on your tangerine and orange sweater.”

 

In the end, we simply couldn’t keep the package.  We found out about an alternative.  We learned that technology exists to place the lines underground.  NP’s partner, Hydro-Quebec, markets this technology as a cost-efficient low-impact alternative to overhead lines.  Yet, Northern Pass insists that burying is too expensive and too impractical. Many disagree with them on this point.

 

Contrary to Northern Pass claims, this technology,  HVDC Light, is practical and reasonably priced.  Other energy developers understand this and realize that the public does not object to invisible, secure buried transmission lines.  Projects transmitting Canadian power south through Vermont, New York, Pennsylvania and Maine will use this technology, and are facing little if any public outcry as they navigate the permitting process.  These projects use already softened corridors, such as highways or railroad beds; some lines go underwater.  Often there is payment to the state which owns such corridors. In addition to their low impact, underground lines are far less susceptible to weather damage, have fewer faults, and when sited along highways they are easier to get to than aerial lines strung through remote areas.  Odds are that these forward-looking underground projects will be in full service while Northern Pass is still tangled in permitting and legal battles that will likely prevent the project from ever being built in its present design.

 

Curiously, Northern Pass remains unmoved by the sustained objection to this project – not just from individuals whose land is directly affected, but from whole towns that voted to oppose it, 33 of them.  They took no notice when Governor Maggie Hassan and Senator Kelly Ayotte told them they ought to put it underground. They did not heed objections from every North Country Chamber of Commerce or all of New Hampshire’s environmental groups. With breathtaking arrogance and utter lack of regard for our iconic landscape and the project’s crippling damage to everyday people, Northern Pass simply plows on, running expensive ads that highlight the shiny paper and pretty ribbons, paying high-priced lobbyists to influence legislators, and acting as if the objections didn’t exist.

 

If Northern Pass ever expects to run even one foot of high voltage cable through our state, they will need a customer service window, equipped with 187 miles of HVDC Light underground cable for New Hampshire customers who demand to exchange this unwanted gift for a solution that respects our state and its citizens.