CFAC protests taxes

According to documents, company claims 807 acres of land it owns is worth $1

By CHRIS PETERSON

Hungry Horse News

The Columbia Falls Aluminum Co. has protested its tax valuation and if it's successful, it could put a big dent in the Columbia Falls school district's budget.

Currently CFAC pays about $289,000 to the elementary side of the budget and $128,774 to the high school budget. If their protest is successful, the elementary would get about $165,000 and the high school $73,500.

In short, the tax appeal has the potential to be a rather large hit to the school's budget.

The company is seeking a 4/7 reduction in valuation, from $69.5 million to $29.5 million, school Superintendent Michael Nicosia told the board Monday. CFAC is a wholly owned subsidiary of the Swiss-based Glencore Corp.

It currently operates one of five potlines at the plant, though it's in the process of adding about 130 jobs in anticipation of starting up more capacity early next year.

CFAC filed the tax protest earlier this fall and the Flathead County Tax Appeal Board ruled in favor of the Department of Revenue.

But CFAC has now appealed its case to the State Tax Appeal Board and if the company isn't satisfied with that ruling, it can take its case to district court, said Scott Williams, regional manager for the Department of Revenue in Kalispell.

Company spokesman Haley Beaudry said the company hired an independent assessor to determine the value of the plant. He claimed that assessment found the plant was worth far less than what the state claimed.

CFAC has already received a reduction in its assessment. Earlier this year the Department of Revenue dropped the valuation of the plant from about $80 million to $69.5 million, noted Conrad Peterson, an appraiser with the Department of Revenue.

But Beaudry noted that other idled plants in the Northwest are being scrapped because they're not worth much.

But CFAC isn't just about buildings and equipment. It also owns about 807 acres of land. According to its appeal to the county, the company claims the acreage is worth $1 and the plant and equipment is worth about $27 million, as stated by the company's financial controller, Robert L. Vixie.

The state values the land at about $2.89 million.

The state tax appeal probably won't be heard until next summer. The company has paid its November 2006 tax bill, but when a protest is filed, the difference between the company's appeal and the state valuation is held in escrow until the appeal process is completed, explained Peterson.

Meanwhile, county and school budgets will have to make up the difference through reserves.

Nicosia said the bottomline is if CFAC is successful, it will put more of the tax burden on residential homeowners.