BATH (WGME) — A tax break for Bath Iron Works could mean a tax increase for everyone else in town.
The city of Bath reached a deal with the shipyard that lowers the shipyard’s valuation by more than $100 million, which both parties say reflects fair market value.
But that could cause waves for everybody else.
Bath Iron Works has been seeking this tax break since 2019.
They believe the shipyard is worth less than half of what the city claims it’s worth.
Now, the two sides have agreed to a $130 million cut in the shipyard’s value — money that now must be made up by home and property owners in Bath.
“Anybody who owns property will see a tax increase,” said City Manager Peter Owen.
Local officials said it will take an annual increase of about $180 for the owner of a $300,000 home now paying about $6,000 in taxes to make up the difference that BIW will no longer pay.
“In the worst-case scenario, I felt like it was something that the taxpayers could live with,” said City Assessor Brenda Cummings. “I’m optimistic that the increase will be less than 3 percent but we’ll see.”
Bath homeowner Louise Perry said she and her husband, Kerry Perry, bought their home in Bath three years ago and are not happy about the property tax increase.
They say they already pay a great deal in property taxes.
“When you have to watch your budget really closely, it can be concerning,” Louise Perry said. “The taxes are going to be made up by the people who have bought property and have paid a lot more than they should have. Too bad, so sad.”
The shipyard issued a statement, saying in part, that BIW agreed to a settlement to minimize the impact on all taxpayers and to avoid the uncertainty of a lengthy dispute.
“As any taxpayer, you sit back and you wonder whether BIW is paying their fair share,” said Mark Falbo, another Bath homeowner.
“This wasn’t a negotiation with BIW to keep them here and lower their costs. This was strictly looking at the numbers of what their facility is worth,” he said. “We still probably feel really differently about what the place is worth.”
The agreement is retroactive to 2019, meaning the city now has to pay back nearly $1 million to BIW for taxes it overpaid.
Those payments will be spread out over the next three years.
As for taxpayers, they’ll have to wait until September to see how it affects them.