By KEVIN BRACISZESKI
Daily News Staff Writer
FILER TWP. — It cost Manistee County, Filer Township and other
local taxing entities about $800,000 to fight a legal case involving
the taxable value of the Tondu Energy Systems Filer City
Cogeneration Plant, but those costs will be covered by at least $1.2
million in taxes the state said the company owes.
The judgment not only dismissed Tondu’s claims that it overpaid
about $8 million in taxes during 1993-96, it also increased the
taxable value of the property during those years causing Tondu to
owe the extra $1.2 million.
“I’m extraordinarily pleased, obviously,” Filer Township
Supervisor Dana Schindler said about Friday’s decision by the
Michigan Tax Tribunal. “It would have bankrupted the township had
the decision gone the other way.
“We were taxing the T.E.S. Filer City plant exactly as the state
had told us,” she said. “We weren’t asking for the moon, like
The Michigan Tax Tribunal also published a decision Friday
declaring that the taxing entities of Midland owed a refund of $29
million in overpaid taxes and $7 million in interest to the company
that owns a cogeneration plant in that city.
Tondu Corporation owns about 50 percent of the T.E.S. Filer City
plant through an affiliated company, Western Michigan Cogeneration
Limited Partnership and employee Beverly Z. Baker and former
employee Robert C. Pelfrey. Tondu Corporation President Joe Tondu
said this morning that he is still not sure how much money the tax
tribunal’s decision will cost his company.
“We’re still in shock,” he said. “Of all the things we thought
would happen, this is one we never thought of.
“For years we had been calculating ($8 million) was how much they
owed us,” Tondu said. “We never contemplated owning them money.”
Schindler said the township had paid about $179,000 in attorney
fees while fighting the lawsuit for nearly 10 years. She said
Manistee County also paid for most of the fees that accumulated
during that time. Among the taxing entities who benefit from the
decision are the township, county, Manistee Area Schools, Manistee
Intermediate School District, West Shore Community College, Manistee
County 911, Dial-A-Ride and the Manistee County Library.
Tondu said his company paid more than $1 million in attorney fees
to take the case to the Michigan Tax Tribunal.
The case centered on the true cash value and taxable value of the
Filer City cogeneration plant during the years 1993-96. The tribunal
originally heard testimony in the case in fall 1997 and reconvened
the hearing in fall 2002.
See TONDU, page A2
Continued from page A1
The tribunal’s decision came Friday, after Judge Richard A.
Southern considered more than 158 exhibits and about 260 hours of
In the end, Judge Southern found that “Petitioner (Tondu) fails
in its burden of proof, the Tribunal finding their appraisal experts
lack any credibility. Respondent’s appraisal experts do the most
credible analysis. The Tribunal lacks jurisdiction to consider
petitioner’s reclassification claim in the alternative.”
Neither Schindler nor Tondu were sure this morning what the
tribunal’s decision will mean to taxes the company owes for the
“I just couldn’t read it this weekend,” Tondu said about the
decision. “The lawyers will be looking it over.”
Meanwhile, Tondu’s company officials continue talks with Manistee
officials concerning the amount of community service fees the
company will pay if it builds a 425-megawatt power plant in
Tondu said he was surprised the issue of taxes and service fees
came up so early in the process since his proposed plant has not yet
been approved. He also said he expects the fees will be based on
what impacts the plant has on the city and county services.