BATH — The City Council will seek advice from the Maine Municipal Association and Maine attorney general’s office on the appointment of an independent investigator to look into the controversial sale in May of city-owned property.
The council Wednesday also refused to disclose what transpired in an executive session earlier this year, where it discussed the sale of the Mid Coast Center for Higher Education.
Councilor David Sinclair, who has called for the council to answer questions from critics of the sale, proposed earlier this month that the investigator interview anyone involved with the sale – including councilors, the city manager and solicitor, and the real estate broker – and collect documents related to the sale.
The investigator would then issue a public report, Sinclair said, “in the hopes of restoring some of the trust that has clearly been either damaged or lost in the course of these proceedings.”
The rest of the council agreed, and the motion passed unanimously.
The council on April 17 unanimously approved the sale of the former hospital on Park Street. The city owned it for about a decade before selling it to Robert Smith of Phippsburg for nearly $800,000, despite its assessed value of $6.5 million, according to the city’s online database. The vote drew no public comment that night.
But since then, Larry Scott of Washington Street and Michael Wischkaemper of York Street have been among residents who have criticized the lack of a response from most councilors to questions they later submitted about the sale.
“If we knew what happened, perhaps there would not be questions of scandal, perhaps there would not be discussions of wrongdoing,” Wischkaemper said last month. “… I don’t think that Mr. Scott or I have ever said that the building shouldn’t have been sold. We think it probably should have been sold. We simply agree that due diligence wasn’t done to set a price, and to sell it in an appropriate way.”
Patrick Scully, an attorney who has worked with Bath before, was one person mentioned Wednesday as a candidate to conduct the probe, although councilors opted to find someone without ties to the city. They said Michael Casey, director of operations with SA Risk Management, has expressed interest in leading the investigation.
With few other names on the table, Councilor Andrew Winglass was among those who expressed support for “widening the net,” and using an entity like MMA to provide people who could run the investigation.
City Solicitor Roger Therriault was expected Thursday to contact the MMA and the AG’s office. Their responses would likely be discussed by the City Council next month.
Therriault also said the council could waive the confidentiality of the executive session, although he noted that whether to do so has never come up in the 36 years he has worked with the city.
“The thing that causes me greatest concern is Roger saying ‘never,'” Councilor Steve Brackett said.
Councilor Sean Paulhus expressed concern about setting a precedent, were the panel to waive the confidentiality privilege in this case.
Sinclair said he shared concerns about the sanctity of executive session. But he noted that given the gravity of the matter, “our privilege ought to yield to the public’s legitimate expectations of, and demands for, full disclosure of the information.”
Sinclair cast the only vote in favor of waiving the confidentiality.
The Mid Coast Center was listed with a real estate agent, and the city received a full-value offer from Smith six days later, according to City Manager Bill Giroux. Part of the offer was that the property would not be advertised until the City Council had an opportunity to consider the offer, the manager has said.
Paul Mateosian, Bath’s assessor and assistant city manager, has said the assessed value of tax-exempt properties is irrelevant. The value listed in the database for the early 20th century property is a “cost-approach number,” based on what it would cost to build a hospital that size, minus depreciation, and is not intended to reflect the existing building’s market value, he said.
The former hospital has been re-utilized as a rental property, and its expenses have exceeded income during much of the time the city has owned it, Mateosian said. A property like the Mid Coast Center, with an unstable tenant situation, would be capitalized at a higher rate than a parcel with a stronger income stream, causing the value to be reduced, he explained.