PORTLAND — Three communities have submitted formal proposals to lure the Maine Narrow Gauge Railroad Co. and Museum from its home on the Portland waterfront.

The city of Portland has submitted one of the proposals. The others are from Gray and Monson.

The Narrow Gauge Railroad began soliciting proposals last summer. Officials said high rent was making it difficult to invest the money needed to preserve the museum’s more than 400-piece collection, which dates to the late 1800s.

The railroad tested the interest of 75 communities to either completely or partially accommodate railroad operations. Of the seven communities that responded with letters of interest, only three submitted formal proposals.

Brian Durham, president of the railroad board of trustees, said a relocation committee will meet over the next couple of months to discuss the proposals. He said he expects the group will issue an analysis and recommendation to the full board in March.

“And then (we’ll) have our board make a decision in April,” Durham said.

The Narrow Gauge Railroad averages about 25,000 riders a year on its 1.5-mile track in Portland, while another 2,500 people visit the museum.

The group claims the railroad and museum, which has a $500,000 annual operating budget, has generated more than $2.5 million for the greater Portland economy.

But rising increasing real estate values on the Portland waterfront – and the nonprofit group’s rent – are eating up too much of the budget.

The three proposals address several factors that will be taken into account with any possible relocation,, Durham said, including infrastructure availability and financial and in-kind support from the municipalities.

Although none of the communities proposed direct financial support, some noted their designation as low-income communities, which make them eligible for grants, as well as in-kind services.

Portland’s proposal cites its urban environment as its primary strength, noting the railroad’s nearly 18 years of success on the eastern waterfront. 

In the proposal, City Manager Joseph Gray said the railroad’s location at 58 Fore St., where the group has a month-to-month lease for about 8,000 square feet of museum space and more than 15,000 square feet of yard space for restoration work, is both an asset and a challenge.

“The challenge is the economic reality of real estate values on the waterfront,” Gray said, noting the train could eventually serve as an alternative mode of transportation.

Gray said the city may be able to partner with the railroad to “enhance programs, as well as directional signage and street lighting to your attractions.”

“Additionally, the city will continue to make its facilities, like Ocean Gateway, available at a reasonable cost,” Gray said.

Gray said the city could not provide buildings or funding to the railroad, but he offered staff support for publicity, events, tour guides, landscaping and beautification.

The town of Gray, meanwhile, presented a vision that would ultimately restore the Portland-Lewiston Interurban Railway, a portion of which would have to be updated to the 2-foot gauge railroad required for operation.

Town Manager Deborah Cabana said in her letter that the town could not provide financial support or offer buildings to the railroad, but she said the town could offer support in the form of its staff, contracted professionals and volunteer committees.

Cabana listed a series of initiatives over the last four years where the town partnered with private entities to complete and plan projects, several of which meet the town’s desire to maintain historical landmarks.

Cabana noted the town’s proximity to the Maine Wildlife Park, Pineland Farms in New Gloucester and the Poland Springs Preservation Network.

“Gray is an easy drive from Portland, Lewiston, and other Southern Maine communities,” she said. “Locating the museum here would be a huge asset to Gray’s ongoing redevelopment, and would give the museum affordable and geographically accessible space, meeting our complimentary goals going forward.”

Cabana said the town worked with landowners to secure grants to upgrade the facade of Clark Block, as well as the town’s recent renovation of the Pennell Institute into a new Town Hall, a project funded by a $2.4 million, voter-approved bond.

Cabana said the right of way to about two miles of rail bed, which passes across the scenic Gray Meadow, is owned by Central Maine Power Co., which often sells 50-foot rights of way with “favorable terms.”

Cabana listed three privately owned sites a potential places for museum operations: The Gray Plaza Shopping Center, a golf driving range and a trucking company property.

Gray’s proposal includes letters of endorsement from the Gray-New Gloucester Development Corp. and the Gray Community Endowment, a nonprofit group that spearheaded the fundraising effort to restore the Libby Hill Trails.

The town of Monson, 20 miles northwest of Dover-Foxcroft and 60 miles southwest of Bangor, in Piscataquis County, said the railroad should move there because of the town’s industrial heritage.

The town said the owner of the former Monson Railroad, which has two original freight bays and an office/waiting room area, is interested in making the space available to the narrow gauge.

The town, which has several granite quarries and lakes and is located along the Appalachian Trail, said it has 165 feet of 2-foot gauge track, which could be extended by as much as 650 feet.

Monson, the home of Moosehead Furniture before it closed, also offered the railroad a 624-square foot room in its community center.

Durham said a fourth community expressed interest in adopting the railroad, but was unable to submit a formal proposal by the Dec. 6, 2010, deadline.

“We got another response that was intentionally late,” he said. “We might talk later as time goes on.”

Randy Billings can be reached at 781-3661 ext. 100 or rbillings@theforecaster.net