BANGOR — Bangor Natural Gas filed suit March 3 against the town of Frankfort over a $14,851.81 tax bill for 2021 issued to the company for a portion of a pipeline running through the town that transports fuel to the company’s facility in Bangor. The company leases the pipeline from The Loring Development Authority of Maine, the public municipal corporation that owns it.

As of March 14, the town had abated the bill because it misidentified Bangor Natural Gas Co. as Bangor Gas Co., town attorney William Kelly said in an email. The town will look at information provided by the company with an expert and then the Board of Assessors will review the case and consider the exemption now claimed by the company.

Because the entire tax bill was abated, Kelly will file a motion for dismissal of the suit.

The complaint, filed in Penobscot County Superior Court, states that no municipality the pipeline runs through has issued a tax bill to Loring for it. Because the pipeline is owned by a public instrumentality of the state, the gas company argues, it is exempt from property taxation. No other town has issued a tax bill to lessees of other property on the former air base owned by Loring.

The statute that established the Loring Development Authority makes clear that its property cannot be taxed, but does not mention anything specifically preventing its lessees from being taxed, according to the Maine Legislature’s website.

But the complaint cites a suit that determined municipalities cannot assess property taxes on the lessees of land owned by the Maine Turnpike Authority, because such land is exempt from property tax.

In a March 11 interview, Kelly said the property taxation aspect of the statute governing the Loring property has to be interpreted. “This is a bit of a novel issue with this statute, so it will be something that we’ll have to work through,” he said in an interview with The Republican Journal.

It is his understanding that the portion of the pipeline from Bangor to Limestone is being “mothballed,” or removed from use, he said in an email to The Journal March 10. The portion of the pipeline from Searsport to Bangor is possessed, maintained and used by a private company, he said, which is the gas company.

Maine statute allows for tenants in common or joint tenants to be taxed on property they lease, according to the Legislature’s website.

The town issued the 2021 tax bill to the gas company for 5 1/2 miles of pipeline that runs through the town, Kelly said in the March 10 email. The town valued the land at $1,072,333 on the bill that was recently abated. When the company received the bill, it advised the town of the pipeline’s exemption status, according to the complaint. The company asked the town to correct what it considered an illegality on its own.

Kelly said he sent a letter to the attorney representing the company requesting more information about the pipeline and its uses. Before providing the requested information, the company filed the suit.

The Loring Development Authority of Maine was established in 1993 to redevelop the former Loring Air Force Base in Limestone, according to the complaint. It acquired the pipeline in 2005.

The town had tried to issue a tax bill to Bangor Natural Gas, which was under a different name at the time, for the 2013 tax year, but the town’s Board of Assessors voted to abate the bill for the value of the pipeline after the company told the town the taxation was unlawful, the complaint says.

Maritime Energy has a privately owned pipeline that runs through the town, which is taxed, Kelly said March 11. He said the town has experience with taxing pipelines.

Kelly invited officials from other towns along the pipeline from Searsport to Bangor to contact him or the Frankfort Select Board to discuss broader participation in the novel issue.