NiMo PILOT for Oswego Steam Stn. approved

CNY Business Journal (1996+), Sep 28, 1998

SYRACUSE--Niagara Mohawk Power Corp. (NiMo) has received approval of a Payment in Lieu of Taxes (PILOT) agreement from the Oswego County Industrial Development Agency for the Oswego Steam Station. The agreement will enhance the plant's competitive potential and make the facility significantly more attractive to potential bidders, the company said.

The PILOT agreement, which was based on a settlement between NiMo and the city of Oswego, the Oswego School District, and Oswego County, calls for $105.3 million in payments over seven years. The agreement was reached with the assistance of the New York State Department of Public Service, whose involvement was requested by New York State Senator James W. Wright (46th dist.).

The Oswego Steam Station's 1997 tax levy was $28.3 million. As part of the agreement, annual payments are scheduled to be $28.8 million in 1998, $25.5 million in 1999, $24.5 million in 2000, $16 million in 2001, $6.5 million in 2002, and $2 million in 2003 and 2004.

Thomas H. Baron, NiMo's vice president of fossil/hydro generation and environmental affairs, said, "The Oswego Steam Station's greatest potential value-as a significant employer and continuing taxpayer--is as an operating plant. The tax agreement provides the foundation for continued operation, the ability to compete in a deregulated marketplace, and provides the taxing jurisdictions a transition period to fine-tune a strategy for the future."

The Oswego Steam Station consists of two 850-megawatt oil/gas units located on the south shore of Lake Ontario, 45 miles north of Syracuse. Rochester Gas and Electric Corp. is a 24-percent co-owner of one unit.

The station, which provides a major portion of the tax revenues for Oswego County, is included among the fossil and hydroelectric assets NiMo is divesting through auction.