Deferring public works construction gains traction in South Portland

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SOUTH PORTLAND — City councilors are getting used to the idea a new headquarters for the public works, transportation and parks and recreation departments will cost at least $19.5 million.

With that in mind, a suggestion that gained support during a two-hour council workshop Monday on the proposed Highland Avenue facility is asking voters in November to OK borrowing $17.5 million, then delaying construction until spring 2016 to soften the bond’s impact on property tax rates.

Mayor Tom Blake and Councilor Al Livingston said they are not sure that this is the year to ask voters for a 20-year bond that Finance Director Greg L’Huereux estimated will carry $7.3 million in interest payments at 4 percent.

“I think I’m the odd man out. I kind of feel this November is not the time,” Blake said, although he acknowledged he will fully support a council decision to place the bond on the ballot.

Council consensus Monday was to have another workshop early next month where the benefits of storing municipal vehicles inside, and the potential savings in maintenance and repairs, can be discussed. Councilors Linda Cohen, Melissa Linscott, Patti Smith and Jerry Jalbert expressed support for the delayed construction plan proposed by L’Huereux.

What L’Heureux called “Option 3” is a method of reducing the cumulative debt impact on property tax rates, while keeping the project less expensive than an option to build the facility in two phases.

The first option, calling for construction and relocation of the transfer station beginning in November 2014, would add a cumulative 46 cents per $1,000 of assessed value to property tax bills by fiscal year 2017. With the entire municipal bond debt added in, the total added would be 65 cents in fiscal year 2017.

L’Heureux noted retirement of existing bonds after fiscal year 2017 reduces future impact, but the projected increase alarmed Livingston.

“I just don’t like the spike,” he said.

A second option presented by L’Heureux would present a $15.9 million bond in November, but voters would then need to approve a $5.5 million bond by 2016 to complete the construction of storage areas.

Deferring a second bond reduces the tax impact in fiscal year 2017 to 37 cents per $1,000 of assessed value for just the new facility and 55 cents for the entire municipal bond debt service.

L’Heureux projected a second bond increases the cost to more than $21 million without interest, while also adding 50 cents to property tax bills by fiscal year 2019.

The new facility, proposed for construction at the current transfer station on Highland Avenue near the Wainwright recreation complex, would have 65,000 square feet for covered storage of vehicles and equipment, more than 23,000 square feet for a maintenance garage, about 10,000 square feet of office space and a 14,000-square-foot covered salt shed.

The site would replace the aging six-acre headquarters off O’Neil Street on Meetinghouse Hill. It is at least 80 years old and has some building that are older, according to City Manager Jim Gailey.

Colchester Drive resident Albert DiMillo Jr. provided the only public comment during the workshop, expressing his skepticism about savings from indoor storage, the worth of city vehicle inventory and asking if outsourcing some public works operations could save money and reduce the scope of the project.

DiMillo was unable to stay through the presentation by Dan Riley, an engineer with Sebago Technics, who said the seven-bay, indoor maintenance space is  critical.

“The fleet maintenance garage is the heart of the operation,” Riley said.

Gailey cited a study by Weston & Sampson, a Foxborough, Mass.,-based engineering company, showing indoor storage boosts public and employee safety, creates cost savings and more efficient operations, and provides benefits to property abutters and the environment.

In his analysis, L’Heureux estimated the city has about $8 million in vehicle inventory that could last two more years if stored out of the elements, and he and Gailey said additional fuel and time savings opportunities may come from not having to warm up vehicles parked outdoors in the winter.

Waterfront and Transportation Director Tom Meyers said maintenance staff will save time and have safer conditions in a new facility. He noted employees now make bus and vehicle repairs on their hands and knees because of space and lift limitations.

Gailey asked councilors to move to a consensus soon, because efforts to educate the public on the need for the new facility should begin this spring. He said TV programming on SPC-TV, displays at municipal buildings and an existing Facebook page will be used.

What becomes of the current headquarters also needs more study. An initial review indicated the presence of lead paint and asbestos, Gailey said. A more detailed study will cost less than $100,000, Riley said, but it is too early to speculate about remediation costs to clean up the property.

David Harry can be reached at 781-3661 ext. 110 or Follow him on Twitter: @DavidHarry8.

Portland City Hall reporter for The Forecaster. Baltimore native, lived in Maine since 1989. A journalist since 2005, covering much of Cumberland and York counties. I joined The Forecaster in 2012.