July 20, 2018
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How Belfast sweetened the deal to win a $150 million salmon farm

By Nick McCrea, BDN Staff
Updated:

BELFAST, Maine — Belfast officials offered to foot the bill for about $240,000 in startup costs to court one of the world’s largest land-based salmon farms, bringing the biggest investment midcoast Maine has seen in decades.

Last week, Nordic Aquafarms’ announcement that it planned to build the $150 million aquaculture site on the outskirts of town drew international attention to Waldo County. In future phases, the Norwegian company’s investment could grow to as much as $500 million.

Shortly after the plans went public, the city and water district released details of agreements that helped solidify the deal.

Just before the Jan. 30 news conference, officials from the city, water district and Nordic signed an options and purchase agreement and a water supply and purchase agreement. Those agreements outline how the city will pay up to $240,000 over a six-year span to help get the project off the ground.

“If we only look at the potential investment versus what the city has committed in financial resources, I think this is a tremendous deal for the city,” Thomas Kittredge, Belfast’s economic development director, said.

The aquafarm push is still in its infancy. Nordic has to complete a lengthy permitting and review process before putting shovels in the ground sometime in 2019. The business will open in phases, with the earliest fishery operations pegged to start in 2020.

Nordic would become, by far, the largest taxpayer in the city. Its annual tax payments on a $150 million property could range from $1 million to more than $2 million, depending on how the site is developed and how much falls under Maine’s business equipment tax exemption.

Belfast officials have set the first public informational meeting related to the project for 6 p.m. Wednesday, Feb. 21, at the Hutchinson Center in Belfast. A panel including Erik Heim, Nordic’s CEO, and Belfast officials will field questions from the audience. The meeting also will be recorded and aired on local television.

Under the terms of the agreements signed at the close of last month, Nordic will purchase 40 acres off Route 1 between Perkins Road and the Northport town line. The water district owns most of that land, and will sell its share to Nordic for $1,059,000. Nordic also will purchase a 12-acre strip from Samuel Cassida for an undisclosed amount of cash.

Belfast also will buy land from the water district. The city plans to buy about 40 acres surrounding a reservoir on the Little River, including about 12 acres in Northport on the south side of the reservoir, for an estimated $100,000. Belfast also will split the cost of a structural evaluation of the dam near Route 1, up to $20,000.

Kittredge said the city’s acquiring the land around the reservoir in part because Nordic didn’t want to purchase that portion of the property because it didn’t plan on building that close to the river and in part to preserve a walking trail that runs along Little River and around the reservoir.

“It’s important to note that while this property was once used for the district’s water supply, it has not been used as a water source for 37 years and never will be again,” Belfast Water District Superintendent Keith Pooler wrote in a letter to the district’s customers. Today, all Belfast’s water comes from a pair of wells fed by the Goose River aquifer. The district pumps a little less than 200 million gallons to its customers each year.

Under its water supply agreement, the district has promised to sell a minimum of 100 million gallons of water to Nordic each year for six years. The city will cover about half the cost of filtering that water annually, up to $120,000, for the first six years of the farm’s operation.

The water district said the city’s water sources are more than up to the task. They pumped 500 million gallons per year several decades ago when the city’s now-defunct poultry and sardine industries demanded a steady flow.

“These changes will not have any adverse impacts on our rates or water supply,” Pooler said.

Nordic’s CEO has said he wants the facility to be “environmentally responsible,” recycling waste, powered with renewable energy sources, and discharging water that’s free of any chemicals or medications. When fully built out, the facility could produce 66 million pounds of salmon per year. Initially, it will employ about 60 people, but could double its workforce in later stages.

Nordic also may preserve a 131-year-old brick pump house at the waterworks site, which the water district has been using as office space since the 1980s, according to Pooler. It could become a visitors center, or be revived by fixing or replacing the old pumps in the basement, though no official decisions have been made.

Though the bulk of its water will come from freshwater sources, Nordic also expects to pump in saltwater from the bay. Details about how the facility will function will be revealed as Nordic continues its design and planning work.

Once the land transfers hands, the water district will relocate, likely building an office on Crocker Road where the city is planning a new public works facility. The sale should become final later this year.

Follow Nick McCrea on Twitter at @nmccrea213.

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