LYONS FALLS — A wood-chip-burning cogeneration plant in Lyonsdale is challenging its assessment following a leap in assessed value from $4.04 million to $26 million.
Lyonsdale Biomass is requesting an assessment reduction to $2 million on its 19-megawatt facility on Marmon Road, according to a state Supreme Court lawsuit filed last month in the Lewis County clerk's office. The company is represented by Albany attorney Mark D. Lansing.
Lyonsdale this year completed a townwide reappraisal, in which assessments are brought to market value.
As part of that process, the town requested an advisory opinion from the state Office of Real Property Services on an assessed value for the 46.2-acre Lyonsdale Biomass property, Town Attorney Mark G. Gebo said. State officials initially valued the facility even higher than $26 million but reduced it after discussions with company officials, Mr. Gebo said.
The town's entire full assessed value last year was $75.38 million.
While the town has no reason to question the validity of the advisory appraisal, it is willing to consider the company's arguments for lowering it, particularly with such a dramatic increase, Mr. Gebo said.
"We're trying to figure out what the right number is," he said. "We don't want them to pay more than they should. But we probably don't want them to pay less than they should, either."
Representatives from the town, Lewis County and South Lewis Central School District have had some meetings with company officials. The three taxing jurisdictions plan to have Federal Appraisal & Consulting, Whitestown Station, N.J., conduct a summary appraisal of the property for $10,000.
While the hope is to settle out of court, the matter involves such "significant dollars" that it could be worth the expense of litigation if the two sides can't reach a suitable agreement, Mr. Gebo said.
"We're trying to be prepared for both alternatives," he said.
Lyonsdale Biomass in 2003 received Empire Zone certification, allowing it to receive several benefits from the state, including property tax reimbursement. The state's advisory appraisal ultimately could lead to a dramatic increase in state reimbursement funding to the company in upcoming years.
The plant's owner, Catalyst Renewables Corp., Dallas, in December 2006 announced plans to construct a $20 million ethanol-producing biorefinery, the nation's first to use wood chips, if a small pilot facility shows the process is commercially viable.
The project is being designed by Syracuse engineering firm O'Brien & Gere in conjunction with the SUNY College of Environmental Science and Forestry, Syracuse, and aided through federal funding. Catalyst has opened a Syracuse office to better oversee the project.
While Catalyst officials initially planned to construct a 50- by 150-foot warehouse building and install several outdoor tanks this year as part of the biorefinery project, no construction has occurred at the site yet.
Company officials referred questions about the assessment situation to Carol A. Thimot, Catalyst's vice president and chief financial officer. Times efforts to reach her were unsuccessful.
Fortis U.S. Energy Corp. also is seeking an assessment reduction, from $14.68 million to $10 million, on its hydroelectric facility off Lyonsdale Road. However, Lyonsdale is close to reaching a settlement with that company, which filed a similar challenge last year, Mr. Gebo said.
Other assessment challenges filed this year at the Lewis County clerk's office:
■ WDC Lowville Associates is seeking a reduction from $2.47 million to $823,367 on its former Section 801 housing on Hemlock Drive in Lowville.
■ Omnifiltra is seeking a reduction from $999,000 to $467,000 on its specialty papermaking plant at 9567 Main St. in Beaver Falls.
■ Robert M. Hough, doing business as Fisher Forestry, Houston, is seeking a reduction from $563,600 to $334,300 on five wooded parcels, totaling nearly 494 acres, in the town of Watson.
■ Thomas and Suzanne Hall of Roswell, Ga., are seeking a reduction from $298,000 to $200,000 for their home off North Bonaparte Road in the town of Diana.
