HomeMy WebLinkAbout1985-03-19 Finance Committee MinutesFinance Committee Meeting
r March 19, 1985
77.45 a.m.
Present: Councilors Cox, McCarthy, Gass, Davis and Willey.
Staff: John Flynn, John Frawley, Rod McKay, Ted Jellison, Dave
Pellegrino, Bob Miller.
Cox - this meeting is to discuss the grievance of successful bidder of
the potential cruise operation
Rod - since this is tied into the acquisition of property loan along
the waterfront, can I go through the scenario that would satisfy a lot
of people? First o£ all, if we proceed like normal cautious businessmen,
without burning too many bridges behind us, the Council be fair about
this, I think weought to proceed concerning land acquisition. We ought
to proceed with appraising both the Superior Paper Product building and
the Maine Coal yard. We have funds available in our Coastal Zone
Management, the appraisals would not commit us to anything. If we do
the appraisals, we could have the City Council or Finance Committee
consider the appraisals. If they seem reasonable when they come back to
then we could send but an offer.. to the property owners. If the
offer's not accepted, then you caatop there and reconsider or negotiate
a price of the property and. then consider, if it can't be negotiated, taking
it by eminent domain. However, if the offer i accepted, and the completed
waterfront plan indicates that the City should have some eventual control,
ownership or use of the property, then we can proceed with the acquisition
of the properties and the implementation of the plan. I£ the offer is
accepted and the waterfront plan is not done yet, and we're talking about
having the plan done by the end of May, then we secure a 90 -day option
agreement on the properties. The option fees will be representative of
the owners' C 441 t costs of the property. In otherwords, if they're
using it, the minimal
mal curating charges if Superior mo out the end of
May or the end ofJune, vacant building, we could compensate them for
leaving that building vacant for a short period of time.
What we're talking about is having appraisals done, take 30 days, say=
the end Of April, mailing out anoffer, considering the appraisals and
ailing out a offer by mid-May and the offer could be accepted any time
after mid-May. So what we're talking about is
a 90 -day option, probably
from the end of May to the end of. August. If we get anoption agreement
n the scenario where we don't have the plan done, get an option agreement
complete the plan. If that plan indicates that we ought to have control
or use
of those properties, then w would go that route. At the same
time, ewwould take into consideration the no -longer confidential proposal.,
the industrial proposal you have, involving the grain shipping and storage
and the coal shipping and storage, to see if that could be accommodated
in accordance with the plan. If the conclusion is that we don't need
theproperties and want the industrial use, then we could either drop _
our option or sign the option to the industrial developer. Or we can
drop the option, and open it up to anybody.
The plan implementation could involve location anywheres along the
waterfront to accommodate a cruise boat facility. Temporarily, what I
propose is to purchase 100 feet of dock space, and either install that
upstream towards the bridge or the present dock to be available for
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recreational or public building purposes, or if we have to, to please
V the State and move the present deck up 100 feet. Its probably not a
good long-term scenario, but in the meantime until we get our plan
done, I think this Would be arnable way to go. I£ at the end of
this s e determine that its not a good mix having cruise boats
and recreational boats. there, we could then move. the cruise boats to
some other facility along the waterfront, either retain100feet of
additional dockspace for recreational use or sell it.
Rod. (still) We're talking at the present site, we would add another 100
feet of dock space, the city parking lot at the docking area
underneath
the new bridge, the overflow going on the street or even up to Pickering
Square, that's no great distance. So try it,after this s if it
doesn't work out, we'll have to .make some other accommodations at least
we'll hare our plan done.
My assumptions are $30,000, the other one's $46,000 just for a float.
Cost is $95,000 .for everything, let's say $60,000.
Rod - All I'm talkingis attaching another 100 feet of dock to the present
dock. John Flynn - it Would have to have its own shore connections.
Talk about whether the existing dock's gangway could be used.
Councilor Gass says this is not going to solve the problem this summer.
Rod - the other thing is we could acquire the property and make it
available.
Gass - where is that money coming from? To buy those other two pieces
Rod - Right now; the bond issue, -the whole amount, we can proceed
with acquiring on the basis that ....
John Flynn - I think Rod feels fairly confident that even though right
now there may be an interpretation by the regional office relative to the
e of CD funds, Rod feels fairly confident that those funds could be
available.
Gass - you're talking Superior Paper, Rod's talking about those other
two possibilities. Where"s the money going to come from for those
possibilities?
Flynn - For Maine Coal and the others. We would intend to put those
in the program.
Rod - We can have
anhave those appraised .now because we intended to do that as
part of the Coastal Zone Management Study. Those appraisal funds are
in the Coastal Zone Management Grant.
Gass - I understand that.
Rod - If we acquire the property, thenwe have the possibility of use
of the CD funds, land and water conservation funds, and any other funds
that might be around. I think intermsoflong-range planning, if we
can redevelop the waterfrontthat would involve the acquisition of all
the property from the coal yard, including the coal yard,to the city dock,
and r of the Vicar Shoe building by s other water -oriented commercial
facility That's why I feel more comfortable waiting until the plan is
done, and we have the cost estimates.
3
Rod - If there's any way we can temporarily accosmeAate the Penobscot
of nuise boat, I think w really want that facility here, we can accommodate
that for this s and see how it works out. As for the short-term
costs for acquiring the dock space, based upon the number of docks,
we could use community development funds. Are you talking $40,000 or
$]5,000?
Someone suggested going to the end of the gangway somewhere approximate
to the present dock and up into the new dock. John Frawley said he
can't be sure that will work, because the shoreline isn't straight there
and if you add another 100 feet you might be right into the side of the
bank. But let's assume that you could, you'd still have to have its
own free=standing supports, so I'm going to say its going to be somewhere
in the neighborhood of $60,000.
Rod - how much of that is labor?
Frawley - Well, the dock itself is $40,000 and then probably half the
other cost is labor, installation.
Rod -sit fair assumption to say that 1DOfeet of dock is 100 feet
of dock. . . (can't make out(
Frawley - you're not going to get your money back, you build a $40,000
dock ... possibly for $30,000.
Rod - that could be reusable by another facility, if we decided we
didn't.
Gass - I thought we were going to discuss Superior Paper.
Flynn -eThis}'S part of the whole discussion. The Superior
Paper lot ties into whatever you're going to do with the cruise boat
operator because if you don't eventually buy any propertydown there,
then you can't enter into any agreement with any cruise boat operator.
So, I think everybody i really uneasy about going in and purchasing
property and tearing down buildings when we really don't have a plan
to know what our long-range goal is down in that area. And this other
guy has come along and wants to use the coal yard for one purpose which
I don't think the staff would be compatible with any kind of recreational
use in that immediate area, but still we don't have a long-range plan
and when somebody asks us what is our plan for the area, we can't give
them an answer.
Rod - what I'm proposing is that we proceed on all properties. If it
turns out we can't use the docking space, the properties are appraised,
we'll know what costs are
involved. here, but whatever cruise boat is
selected we're going to have to have consider Mr. Foss ...
Gass - the question is, we haven't made that decision. We haven't
made the decision that we're going to have a cruise boat. The question
again is how much is he going to give us for the use of something.
Flynn - I guess I wasn't as clear maybe as the Council Order, that you
would absolutely made all those decisions. I think you asked us to proceed
but still have to come back tothe Council for final authority, and
there's been some question along the way as to how we should proceed
and the method in which we should be proceeding.
Gass - Well, if in fact you're going to allow him to dock somewhere
the question is he's going to have to pay and i thought that's what
this meeting was about.
Rod - what Sohn is proposing is a proposed lease agreement, is -that
e tie the docking facility into a lot for parking, and can see where
you have to make parking available for the waterfront, public parking
available for the waterfront, we shouldn't tie that lob up. We can
make it temporarily available until we need it, but not to tie it up.
Gass - where are you going to put the boat?
Rod - The boat goes on the bulkhead. I'm saying let's not tie up the
whole lot for parking with the lease for bulkhead.
Cox - we've heard people talk about other studies in the past regarding
the waterfront, what has characterized the discussions in your point
of view.
Rod - both the American City Corporation and the National Development
Council strongly felt that the key to downtown revitalization was
redevelopment of the waterfront. That without that, w not going
to have any attractions to the downtown. We need to encourage people to
use our public waterfront facility.
John Frawley also mentioned previous study of whole area all the way
to Hampden, that recommended a redevelopment for this area as either
recreational or commercial, or a combination of both.
Rod - we're not concerned with just the property between the railroad
tracks, a lot of property is behind the railroad tracks and are not
being used at all and need to be redeveloped as different uses, and
that won't happen as long as we don't control the property between the
tracks.
Flynn - how they develop will depend upon the land on the waterfront
develops, to a large extent.
McCarthy --It seems to me
we have 2 things in front of us, we have
this land available and we have this opportunity with respect to this
rinse boat. And we're in the process of developing a formal plan and
I find it very difficult to go along with any kind of long-term commitment
for cruise boats, even though it seems to be a perfect opportunity, unless
.and until we know what we're going to do with this waterfront. And I
guess you have the same concern and that's why you're suggesting we make
this temporary arrangement with the dock, but it sounds like its only
slightly feasible
Rod - I think the big kick is that its going to be the best facility
for the cruise boat as the present facility, because that was financed
through state and federal funds for public - recreational use, we cannot
use it for cruise boats. It could be lot cheaper if we could develop.a
facility for recreational boats, we can't move the cruise boat any closer
to the bridge. We can develop the facility for recreational boats and
place our obligation to state and federal government at much less a
cost, but probably the location where the parking is and where parking
under the bridge is, to me.it seems to be a. more feasible short-term
approach.
Flynn - I think it all ties together, Tom really, without the land
we can't have the cruise boat, without providing. some docking space.
Davis - are you talking about the purchase of the land which I don't
think ties into the cruise boat at all. I -think if you're going to
develop the waterfront, that's something altogether different than
trying to accommodate a cruise .boat.
Flynn - they're separate but they get tied together
Willey - they .get tied together Tom because the purpose of buying
that land was because of the cruise boat and more or less building for
that c u se boat. But for the cruise boat, that building will not be
demolished.
Cox -- no, no Larry, that w -- John Frawley, if I remember, made it
very clear at our last Finance meeting that this property is very important
to Bangor's economic future.
Willey - there's no plan, Jimmy, how does he know?
Cox he just cited an Anderson 6 Nichols study --
Rod - I don't know when you walked in Larry but what I suggested was
that we proceed ---
Larry - I've been here a number of times, Rod, and I've heard this
over and over again, - why is he pointing to that lot, this area?
Rod -- we proceed we have money in our Coastal Zone Management Grant
to do lAlega-le-the-were<€xen! appraisals of the waterfront. Its
critical for us to know what its going to cost you to do that, to buy
property there. So we proceed with the appraisals of both the Coal Yard
property and the Superior Paper property, proceed on that front, the
scenario is that we develop the plan. We get the appraisals in, if
we think the appraisals are reasonable, then we proceed to acquire the
property (repeat of previous statement)
At the same time, we propose to acquire another 100 feet of dock apace
put it upriver a of the present dock and let that dock space be for
recreational boats. And if it turns out you can't mix the cruise boat
with the recreational boats, that on the basis of the plan, we can
decide on another location for the cruise boat, and decide whether w
weed the extra 100 feet of dockspace for recreational use, if we don't
ant to keep it or we keep it. We could sell it if we don't want to keep
it. This seems
Foss - With all of what you just said how does that fly when you have
oil tanks in the middle.
Rod - They will have to go too.
McCarthy: There are two questions. One waterfront development and
there is an immediate economic opportunity with the Katandin, i hope
we can come up with a plan to take advantage of the opportunity. It's
looks like we can't reach an agreement on this plan yet - do you 'still
think we can.
Rod - i think the c ise boat would be a very favorable impact on downtown.
We're talking $50-50,000 initial cost to put the additional loo ft. of
dock.
Rod - This will assure Foss of the facility. And then we will make the
decision to keep that 100 ft. extension - if we have to get rid of it
we can recoup of good portion of the cost.
Frawley: We still have about $11,000 in the CEM grant - maybe we could
add 20-30 ft. an ach end and carry that on our existing dock and see
if maybe for one year they would allow us to let Foss use it and still
leave some space available.
Flynn: I think we'd be better off putting a separate wharf area for
other boaters and not try to mix the two together. Should be a distinct
separate area for recreationalboating.
Frawley: I was thinking ofonly on a one-year basis.
Willey: I think it's viable. What do you envision the city's role to
be in development of this area? If we start purchasing property and
make it into a landlord -tenant relationship is that different than what
we have done before?
Rod: We're doing development like we have done downtown. Get rid of
incompatible uscontrol the land and make it available for redevelopment
for compatibleuses. Public facilities, I think, should be located as
close to downtown as possible.
Willey: I'm not comfortable .with the concept of the City being landlords.
Rod: Am'not saying w make the decision right now on the property
acquisition. Let'sproceed - when we get the plan we can make our decision
n the property. If we decide not to acquire it, we turn it over to that.
At the same time we are making the facility available to a cruise boat
operation.
Flynn: We are also proceeding in the same direction concerning the Superior
Paper Company. Appraisals are going to be done and we can proceed in. either
direction.
McKay: If the plan is not done when the appraisals are completed. then
I would recommend we get a 90 day option on the property.
Cox: How does that affect the bond issue?
Flynn: I'm assuming we will put a lot of this into the CD program for
FY86.in terms of property acquisition.
McCarthy: If we don't have the money to buy the property, why are
we taking
options. I guess John is saying maybe we have CC money. If that's the case
why aren't we using CD money to buy Superior Paper.
McKay: You have $200,000 of bond i at present. We are proposing
is to take $100,000 out CD funds, $100,000 city funds. Without a plan,
there is a concern about the CD funds. I feel relatively sure in recommending
Its CD funds will be there. The City would have $200,000 in a bond issue
to implement a waterfront plan which would involve partial funding of three
property. acquisitions. I think more federal sources will open up after the
plan is completed. If our plan for the Irving Oil Cc lot - (unclear)
Rod: I£ you can separate the property acquisition from the lease
agreement with Penobscot Hay. Lines, I think as nable fee would be
$1,500 for a base fee with 10 cents per passengerup to 15,000 passengers;
15 cents per passenger for 15,000 to 20,000; 20 cents a passenger for
20,000 to 25,000; 25 cents per passenger for 25,000 and up.
Flynn: I don't think we feel comfortable in recommending we purchase
the Superior company property and demolish the building. We don't have
a plan or any direction.
McCarthy: All we can do is the best we can do. If this is a great
place for a cruise line in 1985 it will be so in 1967.
Gass: It boils down to what are you going to charge i
Flynn: I think it is a question of whether you are going to assume the
dkhk property is going to become a part of our overall waterfront
development and that we will put that cost in on the waterfront o
whether you are going to put that cost directly against the cruise boat.
Gass: I'm talking about the fee he should be paying the city for use
of anything. What the cruise people are going to pay the city.
The use for the dock. He should pay his fair share for the use of the
dock. Aslong as he understands there will be a charge per head so
we can recoup money.
Frawley; He won't go along with a charge per head. You can talk to him
directly. Rockland offered him that same deal. I think you will have
to meet with him to discuss charges, fees.
Cox: I think .Buddy's position is that people are going to perceive that
we spent $200,000 for Foss.
McCarthy: We're not talking about $200,000. We are talking about putting
him on the City dock. Theissue here is the commercial vs. the recreational
interest. .
Gass: I thought this meeting was to discuss the feestructure for the boat.
We still haven't resolved.. it.
Frawley: I suggest you see if Frank will go along with a one year
contract and negotiate a fee; as to the future within two or three months
we should have our waterfront plan for direction.
Next Fin. Committee meeting with Foss - March 22nd at 4:00 p.m.
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