City administrator says Lewiston obligated to $59.2 million in exit costs for Bates Mill
LEWISTON – Jim Bennett’s Bates Mill exit strategy won’t cost the city more than $59.2 million over the next seven years, he said Tuesday.
That’s how much existing contracts and agreements with developer Tom Platz will cost the city if nothing changes, the city administrator told councilors.
Any plan to get the city out of those contracts can’t help but save money, Bennett said.
“That is the amount we are obligated to spend right now, for the next few years,” Bennett said. “But if we can negotiate a deal to even save $1 million of that, that’s a better deal.”
Bennett continued making his case for the city to disentangle itself from the Bates Mill Enterprise Complex during a City Council workshop meeting Tuesday. He’s scheduled to meet with Platz and his representatives Thursday to continue negotiations. The two groups still have four or five issues to settle, Bennett said.
The final deal could be made public by the council’s next meeting on Nov. 18, he said.
The city took over ownership of the property in 1992 and has been renovating mill buildings and selling them to Platz and his business partners.
Bennett suggested last year that the city should begin negotiating with Platz to take over the mill renovations. According to that report, the city should keep its interest in Mill No. 5 and Bates steam generation plant and unload the rest on Platz. Other options, such as demolishing the remaining buildings, halting renovations or finding another buyer were not possible under the contract or even more expensive.
Councilors agreed and the city began negotiations last spring.
Bennett said he thought the people who negotiated the original deal with Platz underestimated how expensive parking would be. The contract requires the city to build new nearby parking for mill complex tenants when Platz needs it. The exit strategy could change part of that, he said.
“We might still be required to provide the parking, but we might change where those spaces are located or when we do it,” Bennett said.
Tuesday, Bennett put a new price tag on what the mill will cost according to the contract – the $59.2 million over the next seven years. That includes $24.5 million in parking obligations, $24.6 million worth of work to be done at Mill buildings 1 and 2, $4.8 million in contract requirements in the mills Platz has already purchased and an annual $750,000 subsidy.
The city has little legal room to change those obligations, unless Platz agrees to renegotiate the contract.
“This is where the train is chugging along to unless we make some changes now,” Bennett said. “The best estimate we have is $59.2 million, and that may be low.”
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