WATERVILLE — City councilors on Tuesday took a first of two needed votes to approve leasing 30 parking spaces in the city-owned lot on Front Street to Colby College for use by a boutique hotel Colby plans to build on the former Levine’s clothing store site at 9 Main St.

The hotel project is part of several downtown revitalization projects Colby is undertaking that total more than $45 million. The council is expected to take a final vote on the parking issue April 11.

Colby President David Greene warned last week that without the parking, the hotel can not be built and without the hotel project, Colby would not be able to build a planned 100,000-square-foot residential complex for 200 students and staff and faculty members at 150 Main St., where Colby purchased property from the city for $300,000. Students in that building would be involved in a civic engagement curriculum. The first floor of that building, as well as the Hains building, which Colby is renovating, would be for retail use.

Under an arrangement with the city, the 30 spaces on the west side of the 60-space Front Street lot would be leased exclusively to Colby for 40 years at a cost of $28 per space per month, which totals $840 per month or $10,080 per year. Also, 12 spaces on the southeast part of the lot would be allowed for hotel use from 6 p.m. to 6 a.m. and for public use between 6 a.m. and 6 p.m.

After 20 years, the cost to lease the west side of the lot would increase to $50 per parking space per month as part of the agreement, for a total cost of $1,500 per month or $18,000 per year. The lot has 60 spaces, so 18 spaces on the northeast part of the lot would continue to be available for public use 24 hours a day.

Before a packed council chamber Tuesday, councilors Lauren Lessing, D-Ward 3, Nick Champagne, R-Ward 5, and Winifred Tate, D-Ward 6, recused themselves from voting on the matter. Lessing and Tate are Colby employees and Champagne works for A.E. Hodsdon Engineering, whose employees park in the Front Street lot. Champagne’s employer, Al Hodsdon, is a member of the city’s parking study committee and has been an outspoken critic of leasing public spaces in the lot.

Council Chairman Steve Soule, D-Ward 1, and councilors Nathaniel White, D-Ward 2, Sydney Mayhew, R-Ward 4, and Jackie Dupont, D-Ward 7, voted to approve the order authorizing City Manager Michael Roy to complete the parking lease agreement with Colby.

City and Colby officials developed the hotel lease proposal, which says Colby will be responsible for all plowing, striping, maintenance and repair of the parking lot.

They estimate the lease of spaces would provide the city $10,000 per year in income, as well as another $24,000 in savings, as the city will no longer be responsible for maintaining the lot, for a total of $34,000 a year.

Mayor Nick Isgro commended councilors, Roy and Colby officials for finding a solution that works for everyone.

“I just want to thank both the Colby team and city councilors for your work on that — and Mike,” Isgro said.

Brian Clark, vice president of planning for Colby, was part of the team that worked on the proposed agreement. He said the hotel’s 45 jobs, mostly in hospitality service, would pay $1.7 million in salaries per year and the hotel would pay about $37,000 in property taxes a year.

Mayhew said the hotel will be a “polished, modern and appealing beacon” at the entrance to the city and it will provide jobs, which will be good for the local economy. The initial proposal was to lease 42 spots in the lot for $1 a year for $99 years. The improved agreement will benefit both sides, according to Mayhew.

“I like the meat of this compromise,” he said.

Hodsdon, of the parking committee, stood to say he is excited about Colby’s activities in the city, but he had some suggestions on the lease wording and arrangements. He recommended the 40 year lease be broken up into 10-year increments that would be renewable. That would give officials time to solve long-term problems, he said. Hodsdon said he did not know how the mandate that hotel employees not park in the lot would be enforced but it is important that they park elsewhere. He also recommended that the City Hall parking lot and parking spaces north of that lot be open to the public. Most of them are labeled reserved parking now, he said.

Hugh Phelps, who with his wife, Norma, owns the building at 31 Front St., which houses Waterville Family Practice and the Morning Sentinel newspaper, said he bought the building about four years ago for the physician’s practice of his daughter, Julie Phelps.

He said his principle concern is that virtually all of the practice employees park in the Front Street lot and some Sentinel employees park there as well, and some of those employees may be pushed to park at Head of Falls.

Many people, he said, perceive the Head of Falls lot as insecure, particularly after dark, and he hopes there will be a commitment to improve safety, including the stairs to the lot, which are hazardous in winter.

“If you’re saving $34,000, you could certainly put some of that into the Head of Falls parking lot,” Phelps said.

Waterville attorney Tom Nale, a member of the parking committee, urged approval of the lease, saying the hotel will generate income for the city. Isgro noted that Colby’s projects downtown would create $140,000 in new tax revenue, which is more than what the five top taxpaying businesses downtown pay, combined.

“We absolutely should be talking about this in terms of tax revenue, because this is how we get our budget solved,” Isgro said.

Before the discussion on the parking issue, several people stood to talk about the city budget, with some saying the tax rate of $22.80 sper $1,000 of assessed property value should not be increased, as people cannot afford such a hit. Others talked about their fears of what would happen if schools had to cut their budgets. Without high-quality schools, people will not want to move into the city, they said. They said all the economic development happening in the city ultimately will help the tax rate in the long term.

Waterville attorney Tom Ferris said he agreed with Nale that more tax money coming into the city is the answer to the tax rate problem, the city wants to attract businesses and it is important that the parking lease be approved.

“This is a great first step toward that,” Ferris said.

The city ordinance requires that the 42-room-hotel have one parking space per room; so if the council finalizes the plan in two weeks, Colby then can start building the hotel.

Roy said the hotel project is one of three keys to downtown revitalization, the other two being the residential complex and Colby’s renovation of the former Hains building at 173 Main St., which Colby purchased.

Amy Calder — 861-9247

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Twitter: @AmyCalder17