Bow pays off $5.7M portion of Merrimack Station debt

  • Emissions billow out of the Merrimack Station in Bow as seen from River Road in Bow on Tuesday, Jan. 2, 2018. The town of Bow handed over a $5.7 million check to Eversource following a ruling that the town owed the utility after overvaluing the power plant in its taxes. GEOFF FORESTER / Monitor file

  • Merrimack Station power plant in Bow is seen in October. Elizabeth Frantz Monitor file

Monitor staff
Published: 2/15/2018 11:18:03 PM

Bow has paid off a major portion of its Merrimack Station debts to Eversource, but how much money the town will owe the public utility company is still uncertain.

Bow select board chairman Harry Judd said he “hand-delivered” a check worth $5,722,373 to Eversource on Monday, a little more than the $5,548,166 the state’s Supreme Court ruled the town overbilled Eversource for the Bow power plant for the years 2012 and 2013.

About $1.4 million of that figure comes from a tax overlay the town raised when it set the tax rate last year, according to town documents.

An additional $1 million came from money the town decided to set aside for the purpose of paying back any fallout from the valuation case.

The rest of the money – about $3.3 million – came from the unassigned fund balance, leaving a balance of $891,867.

According to the town’s projected budget, the payment will be marked as a $1.745 million increase in the town’s legal service line item in the upcoming budget.

There is no settlement agreement at this point, but Judd said the town decided to pay back the $5.7 million because that amount owed was made indisputable by the Supreme Court ruling.

“We pay our bills first and then deal with the things we want to do with the town next,” he said.

Judd said the town is still in discussion with Eversource about how it will pay back the $1.8 million it owes the company in interest from the 2012-13 valuation. Also up in the air is how the parties will deal with a difference in valuation for the years 2014 through 2017.

Judd said there is one bright side: The town and school budgets will have no impact on the tax rate this year despite the payment to Eversource. The town’s operating budget recommended by the budget committee is $11.6 million, a $21,589 decrease from last year’s budget, according to town documents. The school’s proposed budget is about $27.6 million.

But that doesn’t mean residents haven’t felt the impact of losing the valuation case. About a one-quarter of last year’s tax rate increase – which went from a projected $26.27 to $27.77, or an increase of 5.6 percent – came from the town lowering Merrimack Station’s valuation to $75 million, according to town documents.

The rest of the increase came from the aforementioned overlay, which grew the tax rate by 7.8 cents per $1,000 of assessed property value. That’s an extra $235 on the tax bill for a home worth $300,000.

(Caitlin Andrews can be reached at 369-3309, or on Twitter at @ActualCAndrews.)

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