Council sinks pier deal, floats arts TIF

City beat
By DEIRDRE FULTON  |  November 19, 2008

Three pieces of big news came out of Monday's Portland City Council meeting. Make sure you stay in the loop:

Anyone worth their weight in municipal ordinances already knows that the city's deal with Olympia Cos., the developer chosen last year to repair and build on the Maine State Pier, is no more. The Community Development Committee, chaired by Cheryl Leeman, recommended last week that the council should kill the deal; the full body (minus councilor James Cohen, who has recused himself from pier-related matters) affirmed that recommendation Monday evening.

The main sticking point is an ongoing disagreement between the city and state over who owns the submerged lands beneath the pier. Although the city knew for months (years, even) that the ownership rights were ill-defined, they have not yet sued to establish their title; city attorney Gary Wood expects to file that lawsuit in January, and that it will take between 12 and 18 months to resolve. Without established ownership, the city can only issue a 30-year lease; but Olympia Cos. wanted a 75-year lease and is uncomfortable with the financial risk that comes with a shorter one.

So, what now? Well, nothing, until the new council is sworn in on December 1. The council could choose to relaunch the process completely, and issue a brand-new request for proposals (see "Saving a Sinking Waterfront," August 31, 2007). Maybe this time around they'd get more than two submissions? Or, the councilors could just go with the entity that submitted the only other proposal in February 2007: Ocean Properties, the development company with ties to former US senator George Mitchell and Governor John Baldacci's brother Bob. Ocean Properties has said it can work with a 30-year lease.

Both new city councilors, John Coyne (District 5) and Dory Waxman (at-large), prefer the Ocean Properties plan. However, due to Waxman's former role as a community organizer for the developer, several observers (including a few fellow councilors) hope she will recuse herself from any vote related to Ocean Properties. Waxman has not returned calls for comment on the pier issue.

A portion of property tax revenues from a downtown zone between Longfellow Square and City Hall will be dedicated to arts and culture in Portland, thanks to the council's establishment of the Arts District Tax Increment Financing (TIF) district.

The Creative Economy Steering committee, led by councilors James Cohen and Dave Marshall, recommended the creation of the TIF district in its October report. The TIF money, combined with private and grant funds, will be used to create the Creative Portland Corporation (CPC), a "quasi-municipal agency" charged with growing Portland's creative economy. In the near term, the money to launch the CPC "would have to come out of the general fund," says District 2 councilor Marshall, who added that the resolution was adopted unanimously "with that understanding" about the financing.

However, the money would be quickly replenished with TIF funds, which will be any property-tax revenue from the district, beyond the amount received this year. Forthcoming development of the Baxter Library and Portland Hall are expected to add significant property value — and, therefore, tax revenue — in the district.

Car-sharing is coming to Portland! The city council entered a contract with U-Car Share, a division of U-Haul, to place four PT Cruisers at designated spots around Portland. The service will start in about a month; cars will be available by-the-hour ($10 an hour) or on a day-long basis ($65).

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