GARDINER — Rebuffed by neighbors, the Oak Grove Cemetery Association may have found a place for its crematorium in the city business park.

The association recently signed an agreement to buy a $35,000 lot in Libby Hill Business Park, and also is offering the city a “payment in lieu of taxes” if a deal is finalized and the facility built.

But Russell Greenleaf, who leads the association, said he’s going to wait before he gets excited.

“It’s been two and a half years since we first went to the Planning Board — and I’ve learned better,” Greenleaf said Monday. “I’m not going to get my hopes up until all the I’s are dotted and all the T’s crossed.

“We still have to obtain the land and go through the Planning Board and get approval, so it will be a while. Hopefully, we’ll be on the agenda in August, but there’s no guarantee.”

The cemetery association had wanted to operate a crematorium within an existing receiving tomb at Oak Grove Cemetery. The plan met state criteria. And it was large enough, with 27 acres; state law says crematoriums must be built in cemeteries 20 acres or larger. But residents opposed the proposal and the City Council voted against it on Aug. 12, 2010.

Sen. Earle McCormick, R-West Gardiner, and Rep. Steve Hanley, D-Gardiner, submitted a bill, passed last month, that allows the association to build a crematorium in a location other than the cemetery.

City Manager Scott Morelli said the city has 30 days to close the deal.

The association chose Lot 24 — a 4.10-acre lot, of which only 1.5 acres can be developed.

The cemetery association agreed to a “payment in lieu of taxes” arrangement with the city, in which Morelli said the nonprofit would pay property tax as if it were a for-profit entity.

Councilors will discuss the arrangement, signed June 29, on Wednesday.

“One of the things we look for at the business park is tax revenue,” Morelli said. “Since they’re a nonprofit, they wouldn’t have had to pay property taxes, so that wouldn’t have contributed to the debt service or maintenance of Libby Hill.”

The outstanding debt service for Libby Hill — located on U.S. Route 201 — is $6,563,785.

Morelli estimates that the agreement between the city and association will yield over $3,000 in real estate taxes and over $1,500 in real property taxes annually.

If councilors approve on Wednesday, the agreement would be presented to the association for approval, Morelli said.

“This is a good situation for both the association and the city,” he said.

The city has been aggressively marketing the business park, in part by using a Portland marketing company to help attract tenants to its struggling business park.

The city had budgeted $37,000 to market the park, but upped its spending plans at least year by signing up Portland-based Perry & Banks Marketing.

At the time, the city hadn’t sold any of the 12 lots in the Phase ll expansion, which was completed in November 2009.

There are now 11 lots remaining in Phase ll, two of which are pending sales. The first phase has four lots left, with two pending sales.

Morelli would not disclose the names of the parties involved in those sales.

Patrick Traub of Scientific Games, which has an office in the business park, said city officials have treated his people very well, so if they want a crematorium in the park, he will be there “to help cut the ribbon.”

“Years and years ago, when our company opened a new operation site in Indianapolis, we moved into an old mortuary building,” Traub said. “So, having one as a neighbor isn’t going to be bothersome.”

Mechele Cooper — 621-5663
mcooper@centralmaine.com