Brown: ‘We need to live up to our part of the deal”
BRUNSWICK — Come March 9, the town is expected to proceed with its portion of Maine Street Station – with or without the $850,000 federal grant long promised to help offset the $23 million project’s cost to taxpayers.
The town has pursued the grant from the federal Economic Development Administration for nearly two years. Yet, despite assurances from EDA representatives and the town’s previous economic development director, the funding has not been released, threatening project overruns and the developer’s financing.
Now, with construction underway and JHR Development’s deadline to have the first phase of buildings up and running by the end of the summer, the town is planning to submit bonding that will replace – and potentially threaten – the EDA funding.
According to interim Town Manager Gary Brown, JHR has reiterated the need to keep construction moving. On Tuesday Brown told the Maine Street Station Oversight Committee that EDA recently notified the town that it qualifies for the grant, but that the funding would be released no sooner than March 6.
While Brown was confident the grant is forthcoming, he added that he planned to notify the Town Council that the town would proceed without it by March 9.
Doing so, Brown said, could hurt the town’s chances of securing the EDA money.
“We’ve been told by EDA that starting the project prior to grant award could jeopardize the funding,” Brown said. “We’ve also been told that other projects have done it and still received the funding.”
The Town Council has already authorized borrowing $2 million to finance the infrastructure and coal-ash remediation costs of Maine Street Station. However, those bonds have not been released because the town has been pursuing various grants to reduce the town’s financial obligation, which could reach an estimated $3.5 million.
The EDA grant accounts for about 43 percent of the $2 million the town has already committed to the project.
Brown acknowledged that proceeding without the EDA grant could generate backlash from residents, particularly during what promises to be a difficult budget season.
But, he said, the town’s agreement with JHR states that it must fund the infrastructure costs with or without grants.
“Any further delays could put at risk the private sector (side of the agreement),” he told the oversight committee. “It also puts Brunswick’s credibility as a development partner on the line.”
Brown again expressed confidence that the EDA money is coming. However, he also expressed concern about a leadership vacuum causing uncertainty at the agency.
Last week, Sen. Judd Gregg, R-New Hampshire, withdrew his nomination as President Barack Obama’s commerce secretary. The Commerce Department oversees the EDA.
The agency is funded by Congress, which has yet to adopt a budget. In October, Congress passed a six-month continuing resolution to fund EDA through March 6 – the same day Brunswick hopes to receive the $850,000 grant.
Another wrinkle in the EDA funding is its link to a 60-room inn proposed at the corner of Maine and Noble streets. Because the inn is within the town’s historic district, EDA requires that its design be approved by the Maine Historic Preservation Commission.
Brown said JHR and the MHPC planned to discuss the inn in the coming weeks.
March 9 is about two weeks away.
Nevertheless, Brown said the town would be “vigilant” about securing MHPC approval.
Meanwhile, JHR is still looking for an inn investor. Project manager Mike Lyne recently said JHR was in contact with someone interested in managing the inn, but it was also seeking a financial partner.
Brown also told the committee that he planned to have a discussion with MACTEC, the engineering firm overseeing infrastructure and coal-ash remediation, about its failure to accurate calculate the cost of sidewalk pavers for the project.
He said MACTEC’s estimate for pavers was $181,000 short of actual construction costs.
Brown added that MACTEC’s oversight was more about perception than its actual impact on the project.
“If (MACTEC) had gotten its numbers right to begin with the costs would be the same,” he said. “On one hand it may not matter, but it affects the (public’s) confidence level.”
Nonetheless, Brown said he is still hopeful Maine Street Station will be successful. He compared the project to Topsham’s new municipal facilities, which suffered significant overruns and resident criticism.
“People were complaining,” said Brown, Topsham’s former town manager. “But now they go there and say ‘wow, this is really nice for the town’. We’ll get to there with Maine Street Station, too.”