May 26, 2019

Tax deal for motel tabled> Calais owner wants pool, more rooms

CALAIS — The City Council on Thursday tabled a request from a Calais businessman for a tax increment financing package that would allow him to build an Olympic-size swimming pool and add rooms to his motel.

Several businesspeople pressured the council to establish a policy that would treat all businesses in the city equitably, before they made a decision on the request. Otherwise, they said, TIF agreements could provide unfair advantages to some business over others.

Forrest H. Grant, who recently purchased the Calais Motor Inn, and his attorney, John Geismar of Lewiston, were at the council meeting Thursday night to present the request. Although the city does not have a TIF policy, Grant and Geismar pushed for a decision Thursday night, but the councilors resisted the pressure.

Authorized by the Legislature several years ago, tax increment financing allows a municipality to earmark the new property taxes generated by development to pay for new infrastructure, such as water or sewer lines, or return them to the business as an incentive for the development. The amount of the tax rebate might be as much as 100 percent of the new taxes that are generated; the term of the agreement can be from five to 20 years.

In his comments to the council, Geismar said he believed a TIF agreement would be advantageous to both the city and the Calais Motor Inn. “Our aim tonight is to have you vote to approve a development program that we will present to you; a credit enhancement agreement that we then would take back to the state Office of Community Development in Augusta. The state must approve this once the city approves it,” he said.

Geismar said Grant planned to invest nearly $1.2 million in renovation and new construction. Of that, he said, $688,000 would be spent on an Olympic-size indoor swimming pool and 12 new hotel rooms, and $75,000 would be used to pave the motel parking lot and install security lighting.

“The assistance being requested of the city will help to service about a quarter of that debt, $246,000,” he said. Geismar said Grant wanted the TIF for 20 years.

Ken Thomas, who owns a competing motel in Calais, suggested that the city develop a policy.

“The city has no policy on TIFs, and if one is awarded, what would stop anybody else from applying for one. Could they be refused, and is it fair for the city to give one business a tax advantage over others that directly compete with them?” he asked. Thomas said Grant would recoup at least 50 percent of his investment with the TIF.

Thomas was not alone in his opposition. Several other businessmen said they did not support Grant’s request.

“This specific TIF is not being used to bring a new business to the area that would create high-paying jobs. … This TIF is deliberately set up to make a profit at the expense of other businesses,” said restaurant owner Dick Hodsdon. “For the City Council to award tax incentives to a business that directly competes with others may not be illegal, but it is definitely unfair.”

Grant said he believed an Olympic-size swimming pool with a large slide chute would draw people to Calais. He said he expected to see a return of Canadians who were attracted to an area where there was an indoor pool where families could have fun.

“The pool will change the whole complexion of this town. … Anything I get back I’ve created it to start with. Nobody is giving me anything. I am creating that property, why the hell shouldn’t I have it [the property taxes] back for a term of 20 years,” he said in defense of the TIF request.

Grant took exception with Thomas’ remark that he would recoup half of his investment. “It is not going to pay for half of what I am spending down here, Kenny, in spite of what you might say,” he said.

Councilor Earl Jensen said that he would not vote to approve such an important issue without first researching it. He recommended that the council delay any decision for at least 30 days to allow the council to develop a policy. The councilors agreed and voted unanimously to table the matter.

Have feedback? Want to know more? Send us ideas for follow-up stories.

comments for this post are closed

You may also like