Gardiner city councilors will discuss on Wednesday whether to try to leave the Kennebec Regional Development Authority after they review a legal opinion to see whether the city followed the proper procedure when it joined the group 15 years ago.
The authority is the governing body of FirstPark, the regional business park in Oakland that has sustained a net loss of around $5 million for 24 central Maine communities over the last 15 years.
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Councilors voted in October to ask the city’s attorney from law firm Eaton Peabody to review whether Gardiner took the correct steps in joining the regional development group in 1999 and what options the city has if it wants to leave the authority. An attorney with the city’s law firm advised in an unofficial position in 2008 that if there was an error in how the city joined the development authority, it’s unlikely the courts would invalidate the city’s membership and let the city off the hook for the outstanding debts already incurred.
Councilor Terry Berry, of District 1, said he brought the issue to the council because several residents claimed the city isn’t actually a member of the organization, even though it’s been providing taxpayer dollars each year to the development authority.
“We have sunk a lot of money up there since 1999, and there are a lot more years before our obligation ends, if it ever ends,” Berry said.
The council is scheduled to meet at 7 p.m. Wednesday at City Hall.
Two former city councilors, George Trask and Bryan Blanchard, raised the issue several times at public forums this year. They say that because Gardiner joined the development authority through a City Council vote instead of a citywide referendum, it’s not actually a member. Trask, who lost the race for mayor to incumbent Thomas Harnett earlier this month, made the FirstPark issue one of the platforms of his failed campaign.
The Legislature created the development authority in 1998 to establish the regionally supported business park and promote economic development in the region. The bill states that the decision to join needed to be “approved at referendum by cities, towns or plantations.”
But Craig Nelson, president and legal counsel for the authority, has told Gardiner officials the city didn’t need to hold a referendum because it has a city council. The city clerk at the time also certified that the process required by the law took place, Nelson wrote in an email to City Manager Scott Morelli. The development authority and the other communities relied on the certification when it took on the debt, so Gardiner is prevented legally from leaving those obligations, according to Nelson.
Berry said that if the city attorney advises councilors that the city isn’t obligated to stay in the group, he’ll consider whether the city has a chance to win a court case and what it might cost the city before he votes to pursue that option.
Councilors are scheduled to discuss the legal opinion from the city attorney, Jonathan Pottle, in executive session Wednesday night before sharing it in a public session, Morelli said. The city isn’t releasing the legal opinion from Pottle until councilors review it in executive session, Morelli said.
Harnett, who defeated Trask 1,553-983 on Nov. 4, said the opinion will give councilors a clear idea of the city’s obligations and responsibilities and what its options are moving forward.
He said councilors will deliberate “very carefully” on whether to bring any issue to court.
Another municipality with a city council form of government, Waterville, also joined the development authority by council vote. Augusta turned it down in a citywide referendum.
Waterville City Manager Mike Roy, who helped rally support from communities as town manager of Oakland at the time, has said previously that the question never has been raised in Waterville and that the City Council would have been the governing body authorized to join the authority.
Brad Jackson, executive director of FirstPark, told councilors at the meeting in October when they voted to seek a legal opinion to be patient with the city’s investment in the park.
“I’m telling you that when the debt service is paid in 2021, you will be cash-flow positive,” he said. “I just ask in the meantime that you let us grow, and let us make money.”
Jackson also announced at the meeting that a Montreal company making fleet management systems, Road King Technologies Inc., plans to open its U.S. headquarters in FirstPark. The company plans to lease part of a corporate office building in the park to start, but it hopes to grow its U.S. operation to 15 to 20 employees by the end of 2015, according to Harry Marks, the company’s president.
So far the only major business the development authority has attracted to the park is a T-Mobile call center that opened in 2006. Besides that, there are fewer than two dozen small medical offices and financial firms in the park. Some tax revenue is returned to communities annually, but in recent years they’ve been getting back only 40 percent of what they paid.
Paul Koenig — 621-5663
Twitter: @paul_koenig
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