State energy officials say legislation could help Somerset offset tax losses from drop in Brayton Point revenue
Herald News Photo | Jack Foley
Brayton Point Power Station is seen from Somerset.
Legislation passed this month will potentially give the town $3 million to offset tax losses from Brayton Point’s decreased revenue and value, and $100,000 in planning funds to assess the impact of its two coal-fired power plants being retired, two of the state’s top energy officials told the town Thursday.
“I do believe the town has a real opportunity here to plan for what its future is going to look like,” said Secretary Richard Sullivan of the state Executive Office of Energy and Environmental Affairs.
Mark Sylvia, commissioner of the state Department of Energy Resources, whose office will distribute funding to Somerset in three areas after the town has complied with requirements, joined him.
The key requirements include reaching a tax treaty with the owners of Brayton Point. The treaty has been under negotiations since a long-term tax agreement expired in 2011, according to town officials.
Access to funds would follow a blueprint set for Salem’s decommissioned coal plant, and Sylvia said his office would provide “the template” to Somerset “to make this process as easy as possible.”
“These monies can become available as soon as this year,” Sullivan said.
The Clean Energy Center that Sullivan chairs will distribute “not less than $100,000” to help meet the town’s transition from electricity supplied by coal.
Dominion Energy, which has owned Brayton Point since 2005, has been paying in the range of $12 million to $13 million a year in taxes since that time, the company reported.
The Virginia corporation is on the cusp of selling the 1,530-megawatt, coal-fired plant with one oil/natural gas unit to a private equity firm as part of a $650 million deal involving two other similarly sized power plants in Illinois.
Just a couple of years ago, the town assessed Brayton Point at $663 million.
At a half-hour meeting — which included the Board of Selectmen, town officials and legislators that filed the bill, state Sen. Michael Rodrigues and state Rep. Patricia Haddad, among others — Sullivan said the compromise Gov. Deval Patrick signed last week is similar to tax relief for other communities.
Sullivan, a former mayor of Westfield for 13 years, said that town suffered tremendous job and tax losses when Digital left the community, and Pittsfield similarly hit hardships when its main employer, General Electric, left.
Such a loss, “can be devastating,” Sullivan said, although Brayton Point continues to operate and its long-term future remains unclear as revenues drop precipitously in an unfavorable market.
He described “three different buckets” of funds the town could reasonably access, although no specific timetables were discussed.
The third “bucket” Sullivan referenced pertains to the former Montaup/Somerset Station coal plant being decommissioned in 2010. He said there is a “one-year look back” — presumably to 2009 — to establish a tax base.