Sappi North America has filed a formal property tax abatement application with the Skowhegan Board of Assessors for the Somerset mill. Sappi filed this request because the assessed value of the mill determined by the Town of Skowhegan greatly exceeds its fair market value. A fair valuation is critical to the long-term financial health of the mill.
The value of paper mills across North America has fallen sharply in the past few years due to structural demand declines in the industry, according to Sappi.
"Sappi intends to operate the Skowhegan mill far into the future, as evidenced by the many significant investments we have made to maintain its world-class status," said Mike Haws, Managing Director of the Somerset mill. "But in order to remain competitive, we must also be low cost. Sappi accepts its responsibility to assume its fair share of the Town's tax burden, based on an assessment that reflects the mill's true value. Imposing an undue or excessive tax burden on the Somerset mill will not help our community, quite the reverse. It will create a competitive cost disadvantage in global markets and put jobs and future investment at risk."
In 2014, the Town of Skowhegan lowered the appraised value of taxable assets at the Somerset mill from $564 to $464 million. Sappi has expressed appreciation for the reduction in assessed value of the mill instituted by the Town last year, but the company maintains that the reduction was not sufficient to reflect the actual value of the mill.
