Bath council goes public on disputed sale of $6.5 million property for $800,000

Posted Sept. 19, 2013, at 8:38 a.m.

BATH, Maine — The City Council voted Wednesday to publicly disclose a document discussed early this year in a closed-door meeting about the sale of city-owned property.

The one-page, Dec. 19, 2012, memorandum from Community Development Director Justin Poirier outlined the tenant situation at the Mid Coast Center for Higher Education, which the city sold in May. While city staff previously said the executive session preceding the sale occurred in February, it was reported Wednesday to have taken place in January.

“I think it would better for the public if we would simply agree … to release any and all documents related to any and all executive sessions that touched in any way upon the topic of the sale of that property,” Councilor David Sinclair said. “I would also urge that we make it not limited to disclosure to the investigator, but rather disclosure to anyone and everyone who would like to see the information.”

The City Council decided Sept. 4 to reverse an earlier decision not to disclose to an investigator what transpired in the January meeting. City Solicitor Roger Therriault said the next week that he was determining whether any documents were created that must also be disclosed, noting that even if such documents exist, the council did not have to also make them available to the public.

But the council voted 6-2 Wednesday, with Councilors Steve Brackett and Sean Paulhus opposed, to make Poirier’s letter and any documents related to the sale that were shared at or before the executive session, available to everyone.

The council also voted, along the same lines, to allow the investigator – who has yet to be chosen – access to all conversations and documents related to all meetings and executive sessions pertaining to the Mid Coast Center sale.

In addition, the council voted unanimously that any email exchanged by any councilor, City Manager Bill Giroux or Therriault dealing with the property sale is a public record, “and is not a record over which we will exert any claim of privilege or exclusionary waiver.”

Giroux said all such email messages are now available.

He noted that the memo is the only document he knows of that the council received before its January meeting. He called the memo “innocuous,” something meant to lead the council into discussion.

Poirier’s document notes that the Mid Coast Center – a former hospital on Park Street that the city had owned for a decade – had 11 paying tenants at the time. Three of them – Mid Coast Medical Group, University College of Bath/Brunswick and Southern Maine Community College – generated more than $100,000 a year in revenue.

Giroux said earlier this year that the city bought the building for $1 and sold it, to Robert Smith of Phippsburg, for $799,000. The council on April 17 unanimously approved the sale.

Giroux said at the time that the tenant situation was not stable, with one major tenant about to leave and the others shifting to short-term leases. He said Wednesday that the two colleges plan to leave next June.

According to the city’s online database, the building had an assessed value of $6.5 million. Paul Mateosian, the assessor and assistant city manager, has called that a “cost-approach number,” based on what it would cost to build a hospital that size, minus depreciation, that does not reflect market value.

Some residents, including Larry Scott and Michael Wischkaemper, have criticized the sale, claiming the city failed to practice due diligence in setting a price, and did not sell the building in an appropriate way. They are among those who have criticized the lack of a response from most councilors to questions they later submitted about the sale.

The council ultimately decided to hire an independent investigator to look into the sale. But the panel’s Aug. 21 decision to maintain confidentiality of the executive session prompted a campaign to recall five city councilors; with that confidentiality later waived, the campaign was suspended.

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