Towns that show return on investment may get bond money, LePage says

Gov. Paul LePage
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Posted Aug. 01, 2012, at 3:58 p.m.
Last modified Aug. 01, 2012, at 6:57 p.m.

AUGUSTA, Maine — The battle over whether the state should borrow money to fund projects, especially community development work, has escalated in recent days.

Rep. Jeff McCabe, D-Skowhegan, fired the latest salvo in the skirmish between legislative Democrats and Gov. Paul LePage over his decision to delay authorizing voter-approved bonds until at least January 2014.

In a letter to LePage on Tuesday, the two-term lawmaker asked why Livermore Falls, one of 11 municipalities that last year won approval for $3.5 million in downtown development grants, appeared to receive the governor’s assistance in moving forward with its project while other communities, including Skowhegan, did not.

“It just doesn’t make sense,” McCabe said in a release issued by the Maine House Democratic Office. “The governor is willing to help Livermore Falls, but he’s leaving the rest of us in the dark. All I want to know is how Livermore Falls got help and what we need to do to get the same support.”

Adrienne Bennett, the governor’s press secretary, told the Bangor Daily News on Wednesday that, contrary to McCabe’s assertion, no voter-approved state funding was used to advance the Livermore Falls project. Based on a commitment from LePage that bond money for the project would be released when the governor believes the state’s fiscal situation has improved, Kevin Bunker, the lead developer of the project, secured a loan to move ahead with planning and construction, she said.

The governor continues to encourage municipal officials and developers involved with the projects to seek “other creative ways to find funds,” she said. “Livermore Falls was the first community to think outside the box” in ways that “do not make the taxpayer the bank.”

After being convinced that the Livermore Falls project would provide taxpayers with a good “return on their investment,” according to Bennett, LePage on July 16 sent a letter to State Treasurer Bruce Poliquin affirming his commitment to sell $400,000 from the bond package approved by voters in June 2010 “on or before June 15, 2015” to support the Livermore Falls project.

Three other eligible communities — Eastport, Dover-Foxcroft and Monmouth — secured Community Development Block Grants for their projects, according to Doug Ray, a spokesman for the Maine Department of Economic and Community Development. All three “had signed contracts that were well underway” and all three projects fit CDBG guidelines, Ray said Wednesday.

Eastport received $190,000, Monmouth received $157,641 and Dover-Foxcroft garnered $140,000, according to Ray.

In June 2010, Maine voters approved a bond package that included funding to create the Communities for Maine’s Future Program, which replaced the Maine Investment Fund . In March 2011, the Maine Department of Economic and Community Development, which manages Communities for Maine’s Future, put out a request for applications to tap $3.5 million for downtown revitalization projects.

From 32 applicants, the DECD chose 11: Bath, Belfast, Dover-Foxcroft, Eastport, Livermore Falls, Monmouth, Norway, Rockland, Skowhegan, Unity and Winthrop.

In June of this year, LePage informed state agencies and cabinet members that he would not sell bonds until at least January 2014.

On July 12 and again on July 24, McCabe wrote to LePage urging him to authorize funding for the downtown development projects. In Tuesday’s release, he noted that Skowhegan had signed contracts with the DECD and spent approximately $40,000 on downtown revitalization.

In a July 27 response to McCabe, LePage wrote, “I do intend to sell the bonds before they expire in 2015 for projects that provide a return to the Maine taxpayer. And because I am a businessman and not a politician like you, I measure those returns by new, permanent, full-time jobs and increased revenues for the state of Maine.”

After reading in the Livermore Falls Advertiser that Portland-based Developers Collaborative, in partnership with the town and DECD, was moving forward with plans to renovate the Lamb Block building on Depot Street in Livermore Falls, McCabe wrote a third letter to LePage on Tuesday. He asked the governor to explain how Livermore Falls got “fast tracked” and for a timeline as to when Skowhegan could expect funding.

McCabe said Wednesday that John Butera from the governor’s office had contacted him to say he planned to arrange a meeting with Skowhegan officials.

McCabe said his goal in writing to the governor was to ensure that “each project is treated objectively and openly.”

“Each town is in a similar situation and should be treated the same way,” he said.

CORRECTION:

An earlier version of this story requires correction. Livermore Falls will receive bond money to renovate the Lamb Block on Depot Street, not for a medical center, a separate project.

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