More than a half-dozen city and town officials whose communities are in line for shares of a $3.5 million downtown development grant want to meet with Gov. Paul LePage to discuss his decision to freeze state borrowing.
The grant money, awarded to 11 cities and towns by the Communities for Maine’s Future Program, was included in a bond package that voters authorized in 2010. But LePage announced this summer that he would not initiate the borrowing before January 2014.
That has created a problem for several communities that have development contracts and, in some cases, have had to halt projects that were under way.
Skowhegan has a signed contract with an engineering firm and has already spent $23,000 on a $400,000 project to revamp the Somerset Grist Mill. The freeze on the project has kicked off a dispute between LePage and state Rep. Jeff McCabe, D-Skowhegan.
McCabe has questioned why LePage has stepped forward to assist a project in Livermore Falls, but not in Skowhegan.
LePage has not issued state funds for the Livermore Falls development, known as the Lamb Project, but he gave the developer, Kevin Bunker of Developers Collaborative, written assurance that $400,000 in state funds would come before June 15, 2015.
The administration says the promissory note allowed Bunker to access $400,000 in financing from the Maine Rural Development Authority.
LePage’s spokeswoman, Adrienne Bennett, said Bunker faced a “critical deadline” and would have lost an anchor tenant without the state’s assistance.
McCabe said in a written statement that other projects face challenges. He questioned why the governor helped some towns and not others.
“All I want to know is how Livermore Falls got help and what we need to do to get the same support,” he said.
Bunker is the developer of the Gilman Street project in Waterville, which LePage supported when he was the city’s mayor. He attended the project’s ribbon cutting as governor last year.
Bunker and his company, Deep Cove LLC, contributed a total of $550 to LePage during his gubernatorial run in 2010.
Bunker’s Gilman Street project last year also came under scrutiny by LePage ally, state Treasurer Bruce Poliquin. Poliquin criticized the cost of the project during his highly publicized effort to oust Maine State Housing Authority Dale McCormick.
Bunker later called Poliquin’s critique “inaccurate rhetoric” that threw his project “under the bus.”
Bennett said politics have not been a consideration in the administration’s decision to assist some towns and not others.
The 11 grant recipients are Bath, Belfast, Dover-Foxcroft, Eastport, Livermore Falls, Monmouth, Norway, Rockland, Skowhegan, Unity and Winthrop.
Doug Ray, spokesman for the state Department of Economic and Community Development, said the state recently issued Community Development Block Grants for projects in Monmouth ($157,641), Eastport ($190,000) and Dover-Foxcroft ($140,000).
Bennett said the administration awarded the grants based on an evaluation of each project’s estimated “return on investment.”
It’s unclear how the administration is quantifying that standard or whether other projects are falling short of it.
Bennett said the economic development department, not LePage, will likely participate in the meeting requested by several town and city administrators.
Geoff Herman of the Maine Municipal Association said some of the communities are open to seeking bond anticipation notes to receive other financing.
He said the current situation complicates their ability to receive other financing because they don’t control the issuance of the bonds and the state does.
“Banks and bond houses may need something firm (from the state),” Herman said.
Staff Writer Steve Mistler can be contacted at 791-6345 or at:
This story was updated to add Bunker’s critique of Bruce Poliquin, which was included in the original version, but removed for print version.