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Wilder Dam Owner Sues Towns to Lower Tax Bills



Valley News Staff Writer
Wednesday, August 08, 2018

Lyme — The owner of the Wilder Dam is challenging its property assessment in several Upper Valley towns as part of an effort to reduce the company’s tax bills owed to communities along the Connecticut River.

Great River Hydro filed suit in Grafton County Superior Court last August asking the court to reduce the value of “flowage rights” it owns in Hanover and Lyme.

Flowage rights, which are similar to an easement, are a legal mechanism that gives the dam owner the right to flood land below a reservoir’s high water line.

In Lyme, the town has valued those rights at $1.2 million, while Hanover says its share is worth a little more than $1 million.

Great River Hydro, which purchased the Wilder Dam last year from TransCanada Hydro Northeast, argues in court filings that both towns’ assessments are $1 million too high, and the combined $50,000 it pays the two towns in annual taxes is unfair.

The company also has sought lower valuations from Vermont communities, including a request that Norwich lower its $1 million assessment, Town Manager Herb Durfee said on Wednesday. The town’s Board of Civil Authority is scheduled to discuss the matter on Aug. 20, he said.

At issue in all of the cases is how much land can be considered part of the Wilder Dam’s flowage rights, Hanover Town Manager Julia Griffin said in an interview.

Some contend flowage rights end where flooding would halt during a 100-year storm event. Others argue that entire parcels, not just the flooded areas, could be affected, she said.

Valuing such a right can also be tricky, according to Brian Fogg, a Portsmouth, N.H.-based utility assessor working with both Lyme and Hanover.

Assessors are asked to calculate the economic value of flowage rights, he said.

The infrequency of the right — they’re only purchased when a new hydro project is underway — means pricing can’t be easily compared, Fogg said.

The Wilder Dam owns flowage rates along roughly 46 miles of the Connecticut River north to Newbury, where TransCanada (and later Grafton Hydro) challenged its 2012 assessment.

In that case, Newbury officials said the dam owned rights on 1,964 acres worth $1,000 an acre, while the company countered that it was only responsible for 19 acres worth $500 each.

The disagreement was ultimately taken to the Vermont Supreme Court, which upheld Newbury’s acreage calculation in December 2017.

Both Griffin and Fogg said the Newbury case could bode well for Hanover’s and Lyme’s assessments in New Hampshire’s court system.

“That case really sets the stage for both sides,” Fogg said.

Both cases are now before a mediator, who has until September to complete a report. If the towns and Great River cannot come to terms, a trial would be scheduled for November, according to court documents.

Lyme officials authorized the town’s attorney to “discuss an offer” from the company during a nonpublic Selectboard meeting held on July 31, according to minutes. It’s unclear what the offer entails, though, Selectboard Chairwoman Sue MacKenzie declined to comment on the meeting when reached on Tuesday.

Officials at Great River also declined to comment on the case, and a message left for the company’s attorney, Concord-based Michael Ramsdell, was not returned on Wednesday.

The dispute over assessments comes as Lyme officials attempt to recoup $510,000 they argue Great River Hydro owes the town for road repairs near the Connecticut River.

The town argues that Wilder Dam is the reason for severe erosion in Lyme that has forced River Road to be closed for more than two years, the Selecboard argued in filings to the Federal Energy Regulatory Commission, which oversees the dam’s periodic relicensing.

“If the Wilder Dam had not been constructed, and if the water elevation for the last 68 years had fluctuated according to the pattern existing on this stretch of river before the dam was built, Lyme’s River Road would not be falling into the river,” Lyme’s Selectboard wrote in a May letter to federal regulators. “Only during rare floods would the water level reach spots that are currently being subjected to daily exposure and erosion as a result of Wilder impoundment fluctuations.”

Town officials also maintain the dam’s owners made past commitments to care for River Road, dating back to its first license in 1944. Work to reroute the road will begin on Aug. 13 at a cost of $511,000, according to Lyme’s town website.

Great River Hydro and the dam’s former owners have long denied allegations that its three facilities — in Wilder, Bellows Falls and Vernon, Vt. — contribute to riverbank erosion. The utility argues the town’s road woes are instead the result of natural causes. However, the New Hampshire Department of Environmental Services, the Connecticut River Conservancy, the Upper Valley Local River Subcommittee of the Connecticut River Joint Commissions and several landowners have challenged the companies’ findings.

Tim Camerato can be reached at tcamerato@vnews.com or 603-727-3223.