Thanks to a new deal made with the town of LeRay at a special meeting today, an Albany energy company is now set to retrofit a former coal plant at Fort Drum to produce biomass energy.
After rejecting the proposal the first time, the town of LeRay now get sales tax revenue that council members originally asked for as a part of a five-year payment-in-lieu-of-taxes agreement for ReEnergy LLC to break ground on the $34 million project.
Board members unanimously approved the five-year tax break, changing their minds after a new deal was negotiatedin which the company will also pay the town five years’ worth of sales tax it would have lost when the plant is taken off its tax roll for the five-year term of the tax break, effective 2014. Those sales tax payments will total $124,504 over the term, $24,900 a year.
The salestax agreement is separate from the five-year tax break OK’d by the town, which was already approved by the Jefferson County Board of Legislators June 5 and Carthage Central School District June 11. Under the deal, ReEnergy will pay 50 percent of the property taxes it would have normally owed over the five years, with an average property assessment of $30 million a year.
After the tax break was approved Friday, ReEnergy CEO Larry D. Richardson said the energy provider is now set to break ground on the conversion project within the next month. The project will create 33 jobs at the plant, and an estimated 144 jobs at lumber companies in the north country that will collect forest wood and convert it into woodchips to fuel the plant.
“This deal was an important part of the funding for the project,” Mr. Richardson said. “We’re pleased that it addressed concerns the board had with sales tax issues. We knew it was a sensitive issue after the original vote and had dialogue with the town to work it out.”