Otisfield extends Heniger Park lease offer

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OTISFIELD — Heniger Park Association camp owners will be offered a 99-year lease — again.

It’s the latest development in the longtime effort by the town to increase the lease payments at the 100-acre park on Pleasant Lake to reflect lakeside property values.

“This Board of Selectmen is not going to entertain any more 99-year leases (beyond the current offer),” Board of Selectmen Chairman Hal Ferguson said Tuesday. “This is the end of the road, folks.”

Last month, 22 of 27 Heniger Park Association members asked the Board of Selectmen to reconsider extending its 99-year lease offer. The new lease was originally offered to tenants until April 30 but the terms were rejected by 29 of the 37 tenants.

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Last week, the Board of Selectmen agreed to give association members 90 minutes on Aug. 5 to make their case for an extension. After hearing from the group of about 20, the board agreed to consider extending the 99-year lease offer again but only with an “up front” signing cost.

On Monday, the board met to determine exactly what the terms would be. They agreed the new offer would be good for 30 days only and with several stipulations, including an up front $1,000 fee for lakefront tenants and a $500 fee for back lot tenants.

The signing cost is to cover legal expenses incurred in developing the original 99-year leases and other costs resulting from the association’s ongoing attempts to get lease concessions after the original deadline passed, Ferguson said.

Those who wish to sign on to the new lease must also provide a copy of a $400,000 liability insurance policy no later than Sept. 30. All environmental issues must be corrected and accepted by the code enforcement officer no later than Sept. 30. 

The effective date of each 99-year lease will be July 1, 2015. The lease payments will be due twice a year — Oct. 15 and April 15 — to coincide with the date property taxes are due. 
 
The land was left to the town in 1943 by noted Broadway producer Jacob Heniger, who stipulated that selectmen decide what would be done with it. In 1965, the board drew up agreements allowing people to lease 37 lots for fees ranging from $0 to $50 per year for 50 years. Tenants were allowed to build camps, paying taxes on the full value of them.

Tenants paid taxes on an assessed value of $15,000 for back lots and $30,000 for lakefront lots, multiplied by the mill rate. A fee of between $0 and $50 was added on.

Under the 99-year agreements, the value for lakefront lots is $213,000 and back lots is $44,340. A land capitalization rate of 2.2 percent is applied as the lease fee. Buildings are taxed at the current assessed value.

The new agreement gave tenants the opportunity to continue the lease arrangement for the next 99 years at 10-year increments, or let their 50-year lease run out between 2015 and 2040.

If all tenants had signed new leases, property taxes were expected to increase from $9,528 to $100,551 annually, based on the current tax rate.

Last year, the Heniger Park Association, which is made up of a majority of the tenants, publicly challenged the terms and asked for concessions that would, in part, provide better financing terms. Members argued that the increase was unfair because they do not own the land, making it difficult for them to sell their buildings.

The board conceded to 14 of the 28 requests, including agreeing to work with financial institutions by extending the 10-year incremental lease to 20 years to allow for a longer mortgage.

Those whose leases expire June 30, 2016, also had the opportunity to sign a lease extension until 2040. It was a one-time offer by the Board of Selectmen, Ferguson said.

Ferguson said Tuesday that he does not expect all the tenants to sign the newly-offered 99-year lease because some simply want to ride out their existing leases and are not worried about passing their camps along to future generations.

The request for reconsideration of the deadline extension came from Patrick Casey, president of the Heniger Park Association and a Massachusetts resident. He did not respond to an email request for comment on the recent development.

Ferguson said the details of the latest offer were emailed to Casey on Tuesday.

Because of the way the Heniger’s will was written, any future Board of Selectmen could change the terms of the lease again. The current board voted Monday night that there will be no further considerations on the terms of the lease.

ldixon@sunmediagroup.com

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