April 07, 2020

Baileyville ponders tax break for G-P

BAILEYVILLE — A proposed $20 million tax increment financing package to help Georgia-Pacific Corp. modernize its facilities is expected to be presented to voters next month.

Under a tax increment financing arrangement, the town would return $20 million in property taxes to the company over 20 years on nearly $100 million in new capital investment.

Town officials stress that the package would not affect what the company now pays in property taxes. G-P pays nearly 85 percent of the town’s property taxes.

A series of layoffs at Georgia-Pacific’s three local mills the past two years prompted the Town Council to pass a resolution indicating its willingness to enter into a tax increment financing program with G-P. The council expressed hope that the offer would encourage capital investment that would make the mills more efficient and competitive.

Georgia-Pacific is Washington County’s largest private employer. The company operates a pulp and paper mill, an oriented strand board plant and a “chip-n-saw” mill that makes building studs. The three facilities employ about 900 people.

The town and G-P have been busy pulling a proposal together, and the completed plan will be presented to voters at a special town meeting in February.

One project the tax increment financing package might encourage is the conversion of the pulp and paper mill from acid-based paper to alkaline-based paper, which does not yellow. Town officials also hope the package ultimately would encourage corporate officials to replace the old paper machine and make the mill more competitive in the global market.

At the Town Council meeting Monday, Councilor Charlie Towns said some area residents had asked him why the council was willing to give the corporate giant a tax agreement. “If closes for about a year, that would wake people up,” Towns said.

Council Chairman Doug Jones said he believes the three-month closure of the oriented strand board plant announced earlier this month was a wake-up call for the community.

Councilor John Morrison said it was important for the councilors to understand each nuance of the tax package before they try to explain it to the public.

“Once they get all the law parts worked out so our lawyers, their lawyers and the state agree on wording, we’ll sit down and write up a format that will be easy for people to understand,” Jones said.

He said if the package was approved by voters, it would not result in an increase in property taxes to area residents.

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