By PATRICK ADRIAN
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BELLOWS FALLS, Vt. — The Rockingham Selectboard has decided to release the new owners of 9 Lovell Drive from tax obligations stemming from an agreement between the town and the former occupant — medical supply company Vermed.
Vermed is the leasing company for former property owner MDP Properties, LLC.
The decision reached Tuesday requires MDP to repay $31,313.90 to the town under the agreement’s terms for the property’s use.
In 2015, the town forged a five-year tax stabilization agreement with MDP and Vermed. The deal states that should MDP, its assignees or transferees “cease active operation as a business” for 60 consecutive days, then the town could void the agreement.
Once voided, MDP was required to pay the town the sum it would have paid without the agreement, including the difference from taxes already paid.
The purpose was to keep the company in Rockingham. In 2015, Vermed provided 56 jobs and was growing.
In 2017, the company — acquired by Graphics Controls of Buffalo, N.Y. — announced its closure. The town stated that the company officially closed in September and had reached 60 days without operating by Dec. 22. The town voided the agreement on Feb. 7.
According to town records, MDP owes $15,512.05 for tax year 2015-16 and $15,801.85 for the following year. Under the deal, MDP’s property was taxed at a value of $2.3 million, though its listed assessed value was more than $2.9 million.
Without stabilization, its taxes were $70,912.13 for 2015-16 and $72,236.93 for 2016-17.
While MDP representative Rich Kalich contended that the company still had employees in the building through December, his grievance was not simply the back taxes but MDP’s effort to sell the property to a new owner.
On Feb. 16, the property was sold to manufacturer Whitney Blake, Kalich told the board. While details of Whitney Blake’s acquisition or plans remained unclear, Kalich was told the manufacturer plans to repatriate factory work from Mexico and will be moving operations into 9 Lovell Drive in the coming months.
Whitney Blake purchased the property at a depreciated sale price of $1.5 million, Kalich said. The new owners will likely want to appeal for the property to be reassessed.
Under the current agreement, Whitney Blake would have to pay taxes on the 2015 assessed value of $2.9 million, something that would either jeopardize the transaction or at least cause friction between the business and town.
Town Attorney Steven Ankuda explained that the agreement’s language would transfer with the property unless the board released the owner of the obligations.
The board and public expressed concerns whether doing so would also release MDP from its obligations under prior ownership. Town Manager Shane O’Keefe said that the past owners are still liable for past tax years.
“We don’t want a precedent for this to happen all the time,” said board Chair Susan Hammond, “But in my view, this is a unique situation [We’ve] all been arguing about getting manufacturers back here. After however many months they’ve got a manufacturer in there.”
Though not knowing details to the transaction, O’Keefe confirmed town documents on Thursday that the property was turned over to management company Thunderstruck, LLC on Feb. 16.
Whitney Blake is a Vermont-based manufacturer of customized cables and harnesses. Its headquarters is already based in Bellows Falls, with factories located in Springfield, Vt., and Monterey, Mexico.
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