NEWRY — The longtime lease of 8.5 acres of land on Barker Mountain to Sunday River from the Bethel Water District has caught the interest of the Maine Attorney General’s Office.

Linda Conti, a consumer protection attorney with the Maine Attorney General’s Office, said Friday she questions the legality of the agreement.

“It may not be legal,” Conti said. Based on the terms of the water district’s deed to the land, it may not have been authorized to rent land on the summit of Locke Peak. The land includes the top terminal of the resort’s Locke Mountain Triple chairlift, a portion of the Upper Sunday Punch Trail and some snow-making piping, according to Darcy Liberty, the resort’s spokesperson. 

The lease first signed between the water district and the ski resort in October 1961 gave the resort permission to use the parcel for ski-area related activities, including ski lift and trail construction. The deal was for $1 a year on a year-to-year basis up to 30 years. But in 1973 the lease was amended and signed for a term of 32 years at $1 per year. The lease was again modified in 2004 for a term of four years and an annual payment of $3,000. 

That lease, it appears, was signed twice by the same man, James T. Hudson, the resort’s president. He also signed the document as the president of the Bethel Water District. The parcel was crucial to the resort’s development history and the T-bar to the summit of Locke was upgraded to the three-person chairlift there today in mid-1980s under the Hudson lease.

Conti said she was in the process of negotiating with the water district and others over the terms of a trust set up in 1925, which deeded 2,358 acres, including the top portion of Barker Mountain in Newry to the district’s predecessor the Bethel Water Co.

The trust set up by William Bingham II established rules for the use of his side of the mountain, including a stipulation that if the land wasn’t being used for its intended purpose — to provide clean drinking water to Bethel —  it would be ceded to the state for land conservation purposes.

Bingham’s trust stipulates that if the land was not used as a water source, it was to be, “… forever
held, maintained and managed as a public game preserve, bird or game
sanctuary, public park or State Forest reserve.”

The water district contacted her office seeking advice on changing the terms of the trust and in researching that request Conti determined the water district’s board and previous boards may have already violated the terms of the original trust, which doesn’t allow the water district to sublease the land. “This isn’t an investigation we initiated,” Conti said. “They came to us and made the request.”

Conti said the state had several issues with changing the terms of the trust, including the message it sends to others who may be considering placing their lands in trust for conservation. She said allowing dramatic changes to the terms of a trust, averting the intent of the original landowner, would likely keep many people from putting their lands in trust.

The state has an interest in the land because it is named the benefactor in the trust if the land is not to be used for its intended purpose by the district, Conti said, but that didn’t mean the district and state wouldn’t negotiate terms.

Over time things can change, Conti said, and the terms of a trust might need to be modified but typically those modifications are to help preserve the original landowner’s intent.

She said that if an agreement could be reached between the state and the district establishing new terms for the trust that were mutually agreed upon, that agreement would also be presented to a judge. Still, she said, it would be up to a judge ultimately to decide whether the terms of the trust could be changed.

In a January letter to the water district’s supervisor Conti also outlined what she expected to take place:

“It is necessary for us to file a complaint so we can have the court review the trust document and determine which terms can be enforced and which terms should be modified due to changes in circumstances since the trust was created,” she writes. “Hopefully, this office will be able to reach an agreement with the district on how the outstanding issues should be resolved without resort to protracted litigation … There are several issues that will need to be resolved in a proceeding to modify the terms of the trust …”

The district stopped using the land for watershed protection after a flash flood in 2007 destroyed the district’s water reservoir. The district restored the towns water supply by drilling wells in West Bethel and piping water to the town.

Brent Angevine, the chairman of the district’s Board of Trustees, said he was meeting with Conti on Friday to gather information for the other trustees. Angevine said the three-member Board of Trustees were not united on how to handle the situation but that he and another trustee wanted to seek to change the terms of the trust while the third trustee feels the original intent of the trust should be followed.

“So we are not in agreement,” Angevine said. He said his hope was the terms of the trust would be changed so the district could harvest more timber from the land for profit and also keep the lease agreement in place with Sunday River. Money made from the land would be used to help fund the district’s operations and keep the fees water district users pay down.

Angevine declined to comment on the terms of the lease agreement with Sunday River on Friday but said changing the terms of the trust to allow the land to be used by the district for revenue was a “much larger issue.”

Water district trustee Mike Broderick also opposes revising the trust “for short term financial gain,” he said.

In a November letter to Town Manager Jim Doar, Broderick wrote:

“It becomes more obvious to me that, in an earnest attempt to provide value to the rate payers, we have proposed, and gathered a supportive group of non-objective co-conspirators to help us rationalize the abomination, to trample our benefactor’s wishes and vision of a perpetually protected slice of Western Maine for the sake of expediency and money,” Broderick wrote. “Clearly Mr. Bingham had not chosen to provide the district with an ongoing revenue stream. That is what, and all, that our current path provides … I believe we should stop the current plan of action and offer to convey the parcel to the state in strict conformance to the will, see what the state decides to do, and let a constructive and faithful effort emerge from the process.”

At the district’s November 2009 board meeting, a vote was taken to reconsider the trust modification proposal. Broderick voted against continuing the process, with Angevine and trustee Reggie Brown voting in favor of staying the course.

The water district board meets again on Feb. 16.