A Madawaska paper mill was the only facility in Maine to qualify for a tax credit meant to revitalize the industry here.
Twin Rivers Paper Co. will receive $9.5 million under the Maine Paper Manufacturing Credit over 10 years, according to the Portland Press Herald.
That was revealed this week in a report from the Office of Program Evaluation and Government Accountability, a legislative watchdog, obtained by the Portland newspaper.
In that report, the agency identified five other paper mills in the state, but only Twin Rivers met the criteria to qualify for the tax credit. That includes a commitment to make qualifying investments to improve the papermaking facility within two years of application, and to employ at least 400 workers who are full time, have access to health and retirement benefits, and at least 95 percent of whom earn no less than 115 percent of the area’s per capita income, according to the Press Herald.
No other paper mills can take advantage of the tax credit because the deadline to claim it was Dec. 31, 2023, meaning no future investments will qualify, the Press Herald reported.
The Legislature approved the tax credit in 2021 to bolster the papermaking industry, which has undergone a steady period of decline, losing 72 percent of its workforce between 2000 and 2020, according to the newspaper.
Under the program, eligible papermakers can get a maximum tax credit up to $16 million over 10 years for qualifying investments up to $40 million. The annual benefit is capped at $1.6 million, the Press Herald reported.
Twin Rivers made $23.7 million in qualifying investments, which generated $6.4 million in economic activity, temporarily supported 71 jobs and generated $430,000 in state tax revenue between 2019 and 2023, according to the Press Herald, which cited the Office of Program Evaluation and Government Accountability report.
The papermaker made another $11 million investment in equipment over that period, but it has yet to be installed and put to use.
In its report, the Office of Program Evaluation and Government Accountability noted that it’s hard to assess the impact of the tax credit on the timing of Twin Rivers’ “employment and investment decisions,” saying further that “single-entity tax credits” may not be the best way to encourage investment.
