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Fort Fairfield Adopts Free Municipal Land Program to Attract New Businesses
By: David Deschesne
Fort Fairfield Journal, January 4, 2017
The Fort Fairfield town council voted at their December town council meeting to adopt the Municipal Land Incentive Program as proposed by the Fort Fairfield Economic Development Board (EDP).
The town council established the EDB a year ago with a mission to develop plans that will encourage business development in Fort Fairfield. They have been meeting regularly since February. The board of directors consists of Steve Rogeski, David Dorsey, Edith Helstrom, Shane McGillan, and Gary Sirois as board chair. Town council members John Herold and Jason Barnes have also been in attendance at the EDB meetings for input and information purposes, but have no vote in the board's affairs.
“We have been working on different approaches to try to entice, encourage and assist development in Fort Fairfield,” said Tim Goff, Fort Fairfield's Community Economic Development Director who acts as a liaison between the town of Fort Fairfield and the EDB. “We have come up with an idea for a program that we've been working on for the past few months. It's an idea we brought to the table and hope that it will entice someone to bring or build a business here in Fort Fairfield.”
Over the past year, EDP board members visited area businesses in order to ascertain their needs and see what kind of incentives would be required to attract them to Fort Fairfield. “What we're really trying to do is get somebody to come in here and build some buildings and/or employ some people,” said Gary Sirois, EDB chair. “If we can entice somebody to come into Fort Fairfield to build a building, employ some people, then this land that's been laying idle, owned by the town for decades, will now generate some tax revenue and hopefully employ some people.”
The town of Fort Fairfield has some land which is undeveloped, primarily in commercial zones, and it is around that land that the EDB has focused their attention. “We came up with the idea to just give the land away and it's going to be free land to anybody who wants to build something on it,” said Sirois.
The EDB developed a program which, in effect, gives some land away under certain parameters and conditions. The land currently under consideration is located on High Street (Tax map 35, lot 23) “[It's where] the town highway department parks their vehicles where there used to be a redemption center, that's part of it,” explained Sirois. “The land that my storage building sits on is also part of it because that is owned by the town of Fort Fairfield and I lease it from the town. That whole parcel is 6.8 acres of land that is in my opinion ripe for development. It has access, there are two driveways into it, water and sewer is close by and it would accommodate a sizable building if somebody decided to build on there.”
The EDB has established some requirements for the development of the free land. First, one must relocate a business to Fort Fairfield and employ a minimum of two people. “We kicked around the idea of establishing a wage that they'd have to pay but most of us did not want to cross that bridge.” The developer must also have a plan and building designs to be reviewed and approved by the town of Fort Fairfield and meet all the State and local permitting requirements. Construction will have to begin within twelve months of application for the program and be completed within twenty-four months with necessary extensions granted at the town council's discretion. The developer will be required to pay taxes on the parcel at its assessed value and remain current. The town would sell the property for the tax-assessed value, which is around $10,000 per acre for commercial property, and finance it for a period of five years at zero percent interest.
The annual installments will be forgiven on the anniversary date providing the developer has done what he's supposed to do. “So, at the end of five years there's no money changed hands, the developer has not technically paid anything, he now owns the property. If the developer sells the land during the five year period whatever balance is due must be paid in full. The incentive cannot be assigned or transferred to anybody else without the town's approval.” The developer will also be required to give the town a deed to be held in escrow or in trust by the town. If the developer does not meet the conditions that were imposed by the council to obtain this land the town has the option of recording that deed in Houlton and the property ownership reverts back to the town. “We didn't want to get into financing, taking out a mortgage and foreclose because foreclosure takes an extended period of time,” said Sirois. “By holding the deed in trust - now there's some trust involved on both parts, the developer and the town - either you do it or we're taking the land back.” Sirois also noted that the town would have to consider subordinating its position because most developers will have to go to a financial institution to borrow the money to build the building that they want to construct. The developer also must pay any unrecovered costs incurred by the town before executing an agreement. “So, if you want to search the records, if you want to survey the property those unrecovered costs will be paid. The developer will also be responsible for all legal fees incurred during this closing. The last one is a catch-all - and any other conditions imposed by the town. This allows the council to add some other conditions that we as a committee may not have thought of.”
“What we'd like to do is we'd like to encourage people to come to Fort Fairfield, to build a building, start a business or relocate a business on this property or any other town-owned property that might be more suitable to generate the taxes and also to generate some jobs in town. We've been wrestling with how do we get the economic development going in this community. We're one of many, many small towns in Aroostook County and we're all going through the same downturns and loss of population, you name it. How do we stand out? We find a way to in effect give commercial land to somebody, maybe somebody might take note and maybe they might say, ‘well, why not Fort Fairfield?’”