NEWS

Somerset will still collect taxes after power plant deactivates

Marc Munroe Dion

While the deactivation of NRG-owned Somerset Power Station on Riverside Avenue will cost 40 workers their jobs on Jan. 2, the town will continue to collect nearly $800,000 in personal and property taxes paid by the plant every year.

In 2009, the company paid a total of $608,106.69 in real estate taxes and $181,112.56 on personal property taxes for a total of $789,219.25 in taxes paid to the town.

Real estate taxes are for the land and buildings. Personal property tax covers machinery in the plant.

The most recent town budget consisted of $25,937,685 for the school department and $22,413,524 for the town side of the budget.

“Even when it’s deactivated, it’s still a property,” said Selectman Lorne Lawless, adding that NRG will continue to pay property taxes as long as it owns the plant, as would any company that purchased the plant.

Somerset Assistant Assessor Pamela Lee agreed that, idle or not, the plant remains taxable property.

“The land is still there,” she said.

Lee said there could be a reduction in personal property taxes paid by NRG if machinery was removed from the plant but would not speculate on the amount of any possible reduction.

“We use a professional assessor for our power plants, so I don’t want to speculate,” Lee said.

“That machinery would cost a fortune to move,” said Town Administrator Dennis Luttrell, who has been in the plant.

“They still own the land and they’re still responsible for the taxes,” said Luttrell.

Luttrell also said that Somerset Power Plant Manager Len Ariagno told him he was willing to appear before the Somerset Board of Selectmen between now and Christmas to answer any questions selectmen might have regarding the plant’s closing. Luttrell said he passed that along to selectmen.

While the plant is deactivating and laying off its entire complement of workers, NRG Energy spokesman David Knox said Wednesday that the company plans to proceed with plans to convert the aging plant to a coal gasification process and has no plans at this time to close the plant permanently. The gasification process breaks coal down into its component parts before converting it into energy.

Knox did not provide a time frame for the completion of that conversion, but on Sept. 10, NRG Asset Management Director Alan Sawyer said the conversion would take between 24 to 34 months to complete and cost roughly $100 million. The work would create 200 to 250 new construction jobs and create 14 new permanent, full-time jobs at the plant.

In operation since 1925, the former Montaup plant generates 108 megawatts of electricity, good for roughly 100,000 homes each day.

Founded in 1989, NRG is a wholesale power generation company primarily engaged in the ownership and operation of power generation facilities and the sale of energy, capacity and related products in the United States and internationally. The company owns 44 power plants in the United States.

E-mail Marc Munroe Dion atmdion@heraldnews.com.