Hartford
The Wilder dam, which spans the Connecticut River between Lebanon and Hartford, is one of 13 hydroelectric dams that are now on the market after owner TransCanada Hydro Northwest announced its intent to sell last month.
Assessed at $44.9 million on the Lebanon side and another $32.4 million in Hartford, the dam is a major source of tax revenue for the two communities.
Public officials, including Vermont Gov. Peter Shumlin and House Speaker Shap Smith, have expressed interest in the state taking ownership of the dam, a move that could leave Hartford without nearly $750,000 in tax annual revenue.
“I think it would be traumatic,” Selectboard Chairman Dick Grassi said.
Hartford collected $777,100 in taxes on the dam this year, according to the town’s finance department. That’s about 6 percent of the town’s total tax revenue and almost as much as the community spends annually on its planning department and library combined.
But if Vermont purchased the dam and continued its operation, state law would make it a tax exempt property.
“I would be very concerned if we lost that tax revenue,” Grassi said. “I don’t know where we would make that up.”
Former Selectboard member Ken Parker agreed and said losing the dam revenue would make the town’s budgeting a lot more difficult.
“The budget process at best right now is very challenging,” he said. “It’s almost an unimaginable situation.”
Parker called for the state and town to come together and form an agreement for payments, should Vermont choose to buy the dam. He also said long-term plans would be necessary for maintenance payments and the dam’s future decommissioning.
Across the river, Lebanon’s revenue might not be impacted by the sale, said Steve Hamilton, director of the New Hampshire Department of Revenue Administration’s Municipal and Property Division.
Under state law, properties owned by New Hampshire are exempt from local property taxes, but there’s no regulation that exempts other states.
“I’m not sure that we have any examples of another state owning property within New Hampshire,” Hamilton said, adding that Vermont’s purchase of the dams would cover new ground.
The City Council could enter into an agreement with Vermont that would provide a payment in lieu of taxes, he said, but that decision would be up to council members.
While Lebanon would still be entitled to its taxes and in a position to negotiate further deals, Hartford would be facing the opposite.
“If the state acquired it, that would be interesting,” interim Hartford Town Manager Patrick MacQueen said. If a deal did move forward, he said, the town would have to speak up about potential lost revenue.
In New Hampshire, he said, it’s not unheard of for the state to enter into payment agreements with towns that host state-owned property. Both the towns of Plymouth and Durham collect payments from the university system, he said, even though the school property is exempt.
Vermont also makes agreements with towns under similar circumstances, and the legislature set aside $6.4 million for those payments for 2016.
A state-appointed working group began a three-week process to study purchasing the dams this week. Grassi said he hopes members will take into account the communities on the river that could be impacted by the takeover. He said it would also be prudent for Hartford to listen and wait for the group’s findings before the town reacts.
The state considered purchasing the dams about a decade ago when former owner USGen New England went bankrupt, but Vermont couldn’t put together a competitive enough bid against TransCanada’s $505 million offer.
Vermont might not be the only entity looking to purchase the dam. TransCanada spokeswoman Jennifer Link said the current bidding process is confidential, and couldn’t say if any private companies have made an offer. She said JPMorgan Chase and Co. has been hired to handle the sale, which TransCanada hopes to secure by the end of the year.
There’s at least one competitor that Vermont won’t have to worry about. New Hampshire isn’t exploring ownership of the dams, according to William Hinkle, Gov. Maggie Hassan’s spokesman.
Tim Camerato can be reached at tcamerato@vnews.com or 603-727-3223.