The Everett City Council voted to go into Executive Session Monday night, just a few minutes after opening its meeting to “discuss strategy with respect to potential litigation… and…the value of real property…:TIF agreement.”
Joining the Councilors in their strategy session were Mayor Carlo DeMaria, members of the City Finance and Assessing departments, City Solicitor Collen Mejia and representatives of the City’s outside legal team, Mintz Levin, which including former Governor William Weld.
Mintz Levin is known to be representing the City’s interests in its discussions with Exelon Energy about the City’s soon to be expiring Tax increment financing (TIF) agreement for the Exelon property.
Though the entire City Council signaled its inability to answer questions about the Executive Session when the regular meeting reconvened, the Council voted unanimously just a few minutes later to approve a $600,000 transfer from the Assessor’s Overlay Surplus Account to the Assessor’s Professional Services Account, “for payment of legal expenses appraisals and contractual services.”
According to City Auditor Eric Demas, the City has filed in Superior Court to protect the City’s interests in ensuring the TIF agreement expires on time, so that Exelon can begin paying its full tax assessment to the City going forward. The existing tax agreement has been in place for almost 20 years, during which time the owners of the power plant property, currently Exelon, have not had to pay the full value of the increased property taxes.
TIF agreements are typically used by the state or a municipality as a way to allow a private, commercial interest to reinvest a portion of the increase in property taxes that would have been realized from an appreciation or improvement to the property and the business. However, at the expiration of the TIF agreement, the commercial interest has to begin paying its full tax share, based on the increased value of the property.
It has been rumored that Exelon has been seeking or requesting consideration for extension of its TIF, which Chief Financial Officer Demas has said he opposes.
“I am not in favor of extending the TIF,” confirmed Demas, who declined to answer any specific questions about the Executive Session. “We have a lot going on in the Assessing Department right now, Mintz Levin does have a big piece of that, but we also need to pay for consultants and other costs associated with accurately assessing the entire area near Exelon, including Distrigas and other parcels. It is all connected.”