2017-08-17 / Front Page

TA to pay partial year’s taxes

By Grant McPherson
Staff Writer

SACO – Thornton Academy paid a portion of one year’s taxes on the former Winterhaven assisted living facility in June, but will continue to be exempt from paying property taxes on the parcel under its nonprofit status. The school paid $6,630 in taxes for the King Street property under directive from Saco City Attorney Tim Murphy. The Saco City Council amended the King Street contract zone Dec. 5 to allow Thornton Academy to purchase the property for $650,000; its assessed value is $420,000. A contract zone was required to allow a nonprofit organization to purchase the land. If Thornton Academy paid property taxes, it would owe $8,139.60 on the property. The total value of Thornton Academy’s properties is $18,065,900 and the annual taxes would be $350,117.14, if it wasn’t tax exempt.

Thornton Academy Chief Financial Officer Paul Kelly said in an email the school believed it would pay no property taxes after the council’s vote to approve the zoning change in December. However, the school received a notice of a past due tax bill on the property in February. Murphy said the tax exemption did not take effect until the end of fiscal year 2017, during which time the Winterhaven property was a taxable entity.

“We politely disagreed with him but we paid the second installment of the tax bill anyways,” Kelly said.

Saco resident Barbara Colman, who lives on Stockman Avenue, sued six city councilors, the mayor and the city administrator regarding the matter, according to a Courier article published Jan. 12. According to the article, Colman sued over concerns the city council improperly amended the contract zone. Justice John O’Neil Jr. dismissed Colman’s case Friday, May 12. The city spent $6,227.75 on legal fees during its proceedings with Colman.

The city council discussed the idea of Thornton Academy making a payment in lieu of taxes (PILOT) during last year’s budget workshops. Ward 1 Councilor David Precourt said people in the community expressed interest in a PILOT because of the loss of city revenue for all of Thornton Academy’s properties. Precourt wasn’t in favor at the time because he felt Thornton Academy supports the community in many other ways, including spending $262,000 subsidizing meals for Saco students who need it.

“I wasn’t going to fight for a $10,000 or $12,000 tax bill when an entity is already willing to do things on their own,” Precourt said. “I didn’t think it was worth pushing that issue.”

He said it made sense for Thornton Academy to use the building as dorms considering it was an assisted living facility. The school plans to have 18 beds on the property as well as living arrangements for facility staff. Precourt said the purchase is not impactful on the neighborhood, plus it allows foreign students to spend money in Saco, a winwin for the community. If Thornton Academy continues its off-campus dorm expansion, Precourt said he would consider asking the school for a PILOT. However it would be a matter of discussion for Precourt’s replacement, as he does not plan to run for Ward 1 councilor in November.

Ward 7 Councilor Nathan Johnston supported the school’s purchase of Winterhaven but also wanted a PILOT to be established. King Street is only the latest off-campus property to be acquired by Thornton Academy, others including 62-68 Clark St. and 10 Fairfield St. Johnston sees a substantial loss of tax revenue by allowing a nonprofit to own several off-campus properties.

“There is no doubt Thornton Academy provides a great education to the youths of Saco,” Johnston wrote in an email. “However, as their international exchange program expands, their need to provide housing has taken from our taxable properties.”

The University of New England makes an annual PILOT of $100,000 to the city of Biddeford. Saco City Council voted last fall against requiring Thornton Academy to pay into such a program. Johnston said the council has struggled to balance the needs of the city and its taxpayers during his four years on the city council.

“A modest payment compared to the overall valuation of properties I believe is fair and sends the message that Thornton Academy is part of this community as it further expands off its 90-acre campus,” Johnston wrote.

Contact Staff Writer Grant McPherson at news@inthecourier.com

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