AUGUSTA — The owner of the historic Kennebec Arsenal, just over a month away from foreclosure on the property by the Greater Augusta Utility District, has paid off $60,000 owed to the district to avoid potentially losing the property.

Meanwhile masonry work started on the building last week, in an effort to prevent additional water from getting into and damaging the buildings.

The owner of the riverfront National Historic Landmark collection of granite buildings, Tom Niemann, said his company wired two payments to the utility district, one for $37,000 in liens the district had placed on the property, the other for $23,000 in more recent bills owed to the district for stormwater fees, Friday afternoon.

Sherry Kenney, finance director for the district, confirmed late Friday the district had received those two payments, appearing to settle all debt owed on the Arsenal property and putting a halt to pending foreclosure proceedings.

“Both payments were sent and we should be in good stead,” Niemann said. “And we intend to keep our account current.”

Hovering over the situation is an agreement between Niemann and the state, reached to hold off a lawsuit filed by the state Attorney General’s Office in 2013, claiming Niemann had not properly maintained and protected the property. The agreement requires Niemann to take steps to secure, preserve and protect the buildings on the property, built by the federal government between 1828 and 1838 and considered by some preservationists to be among the best and earliest surviving examples of 19th century munitions depots in the country.

Niemann said work is taking place on the property now that he hopes, by a June 15 deadline, will satisfy the state’s preservation requirements.

If action wasn’t taken to address part of the debt — specifically $37,000 owed to the Greater Augusta Utility District for stormwater catch basin fees dating back to 2011 — the property was scheduled for foreclosure June 23.

District officials said they don’t really want the property, and they had anticipated Niemann would settle up before then. But if he didn’t they said they would take action that could include taking the seven-building property which sits prominently between the Kennebec River and the state’s east-side office complex on the former Augusta Mental Health Institute property.

“The district doesn’t want to be in the real estate business,” Ken Knight, chairman of the district’s board of trustees, earlier in the week before the payments were wired to the district.

Knight expressed frustration, Friday, that it cost the district money to go through the legal process to file liens and that the district had to initiate foreclosure proceedings to prompt payment.

Knight noted the district is about to enact a stormwater rate increase, so it was especially important the debt on the Arsenal was collected so other ratepayers, many of whom may struggle to pay their bills, didn’t have to cover that debt.

Niemann said he and his partners at his firms Niemann Capital and Main Street I LLC looked into paying the debt last year but decided not to do so after learning the district was planning a stormwater project, meant to help prevent combined stormwater and sewage from overflowing into the Kennebec River during major rainstorms. That’s because the district may have needed to locate some infrastructure, including a large underground storage tank, on land that is part of the Arsenal property. An easement would have been required to do so, and Niemann said he anticipated value of that easement could more than offset the money owned to the district for the Arsenal property.

However he said the district has since determined it doesn’t need to use that land.

Brian Tarbuck, superintendent of the utility district, said district officials did indeed consider the Arsenal property as a potential site for underground infrastructure, but have since determined the district has enough land of its own nearby where that infrastructure can go, so there will be no need for an easement to the Arsenal site.

Tarbuck said he said he couldn’t recall the district foreclosing on any properties in his 10 years there.

“We’ve never foreclosed on anything, Tarbuck said. “This is a really uncommon situation we’re in.”

Kenney, finance director for the district, said the next-highest amount of debt the district has had to file liens on is $13,000.

She said in March of 2013 Niemann setup a payment plan in which he’d pay $2,000 a month to settle the then-much-lower debt, but only paid that for two months.

WHITE ELEPHANT?

Niemann, who bought the property from the state in 2007 for $280,000, questions whether anyone else would want it, due to the restrictive covenants attached to the sale by the state, requiring the property to be preserved and protected as it is developed for new uses.

When he purchased it, the plan was to redevelop the neglected former state property with new uses including retail and office space and, later, a boutique hotel. However since then no tenants have signed on to move into the property and no development has taken place.

Niemann said the project struggled in large part due to the economy crashing shortly after the purchase, making it hard to get financing.

The property, state officials alleged, fell into neglect and buildings were damaged by vandals, and the weather.

Niemann said in 2011 the state gave him a list of developers he could potentially sell the property to, but he found no takers for the property.

I went to every developer on the state’s list and every single one said the same thing — we don’t want it, we don’t want to partner on it, we think it’s a white elephant,” Niemann said. “I would have welcomed a buyer in 2011, but no one wanted it.”

Despite the challenges and lack of development there so far, Niemann insists he still wants it and remains committed to see its long-promised but also long-delayed development through. He said other than a small project in North Carolina, the Arsenal is the only development he’s working on. He said that over the last five to seven years, his companies have done the best they could for the property.

“I take my responsibility to the community and state very seriously and I’m proud of this property and have no intentions of giving up the property,” he said.

State officials could not be reached for comment regarding whether they feel Niemann has complied with the terms of the agreement to preserve the buildings. Court officials said the judge in the case issued a stay, essentially putting the lawsuit on hold, in September of last year and there has been no action in the case since.

Niemann said he hopes, by June 15, to have met the state’s requirements to preserve the buildings and move into the next stage of attracting tenants, moving ahead with development and getting out of litigation with the state.

He said he has “several” potential tenants interested in possibly locating at the property, including one interested in something like a boutique hotel, restaurant and marina at the site, but has no commitments.

WORK FOR MASONS

One potential tenant, the Maine School of Masonry, is interested in locating its School of Restoration and Preservation on the property, Stephen “Mitch” Mitchell, founder of the school, confirmed. He said that would likely be a couple of years away from happening partly because all the buildings at the site need a lot of work before they’d be ready to be occupied.

Mitchell said the Maine School of Masonry would remain at its current location in Avon, but he’s interested in locating its School of Restoration and Preservation to the Arsenal site in Augusta.

He said the spot is centrally located and its historic, Hallowell granite buildings would provide ample opportunities for students to hone their craft and learn how to restore and preserve masonry.

The Arsenal is one of four project sites around the state — Fort Knox, in Prospect, is one of the others — where masonry school students put their new skills into practice, under the watch of Mitchell, who has more than 40 years as a mason.

Mitchell said they’re doing the work on Niemann’s property at no charge, for the students to get experience working on a historic restoration and preservation project.

The students are currently repointing at the riverfront granite-block North Burleigh building, putting new mortar between the joints to make it weather-tight.

Also working as a consultant on the project, for a fee, is Richard Irons, owner of Richard Irons Restoration Masons in Limerick, an accomplished, 45-year mason who recently spoke on masonry restoration at Maine Preservation’s annual meeting.

Irons and Mitchell said there are obvious signs that previous attempts to keep water from infiltrating the building took place, but whoever did the work didn’t use the proper mortar and techniques to match the appearance of the lime-based mortar that’s original to the structure. Someday, he said, the state and Niemann would like to have all that improper masonry work replaced with period-correct materials. But for now their focus is simply to fill in the exposed joints to keep water out to prevent further damage to the building.

“Just this building alone could keep us busy for years,” Mitchell said as students used hand tools to insert new, but period-correct, mortar into the two-foot thick granite block walls of North Burleigh. “And there are seven buildings here.”

They said it took a month of experimentation and back-and-forth between consultants and state Historic Preservation Commission officials to get the mortar approved for use in the historic structure, which the state most recently used as office space.

Irons said the project came with a book full of specifications, about two inches thick, to be followed in the restoration. He said its the kind of job he’d normally not take, but Irons, who said he loves old buildings, agreed to join the project.

“When I come over the (Memorial) Bridge and look at this site, it makes me smile,” Irons said of the prominent site and its collection of buildings and riverfront stone pier. “I’m excited about the project. When you’re talking granite block construction, it’s pretty sturdy. The basic bones and structure are pretty good. But there still is a lot of work needed here.”

Keith Edwards — 621-5647

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Twitter: @kedwardskj