Searsport tank proposal

Security expert scheduled to testify in February

Opponents talk of decreased property values, decline in tourism
By Tanya Mitchell | Jan 18, 2013
Photo by: Tanya Mitchell Opposition attorney Steve Hinchman (at left, seated at the microphone) addresses the Searsport Planning Board Thursday night, Jan. 17.

Searsport — At the seventh day of public hearings on a proposal from a Colorado company to build a liquefied petroleum gas storage terminal at Mack Point, the Searsport Planning Board voted to continue the hearings until Feb. 11 to allow the board to hear testimony from counter-terrorism expert Richard Clarke.

The Board took that vote at the start of the hearing Friday night, Jan. 18, despite the written and verbal arguments from attorneys for the applicant, DCP Midstream.

Scheduling conflict

DCP attorney James Kilbreth expressed concern that since the all hazards and risk assessment analysis from Clarke’s consulting firm, Good Harbor Techmark, was completed early last week, some people have had a chance to read the report while others have not. Then Kilbreth moved to exclude the report.

“There is nothing in the Good Harbor report that frankly speaks to any of your ordinances,” said Kilbreth. Kilbreth further stated that he felt the contents of the study, which took some state and federal agencies to task for doing an inadequate job of evaluating the DCP permit applications, should not be considered by the Board because those points are “not an issue for the Searsport Planning Board.”

Steve Hinchman, attorney for Thanks But No Tank and other interested parties that have expressed opposition to the project, objected to Kilbreth’s discussion of the report, since Planning Board Chairman Bruce Probert announced at the Thursday, Jan. 17, hearing that any talk of the Good Harbor study would have to wait until Clarke makes his presentation next month.

“If he’s going to talk about the report, then I’m going to talk about the report,” Hinchman said.

The Board initially scheduled the reconvened public hearings for Wednesday, Jan. 16, but the hearing was canceled because of a snowstorm. Wednesday night's hearing was to have begun with Clarke’s presentation, an analysis Islesboro Island Trust commissioned last fall. The study from the consulting firm, under the ownership of Clarke, was released Monday, Jan. 14. The report recommended “not proceeding with the project as currently proposed." The study also concludes that the Searsport Planning Board must deny the LPG permit applications submitted by DCP.

Hinchman said at that time that Clarke would likely be unable to arrange a trip back to Searsport until the week of Feb. 11. Hinchman said his clients feel Clarke is "integral to that report" and should be the person presenting the information.

Thursday night, Kilbreth suggested the Board ask the opposing parties to produce the Good Harbor report at what was the next scheduled hearing date, Monday, Jan. 28, and if Clarke is too busy to make his presentation, then the Board should accept the report as part of the written record.

“Then we’ll submit our response in writing, with no testimony,” said Kilbreth, noting that the delay on the study is “another opportunity to drag this out.”

“It has become abusive; it has to stop,” said Kilbreth.

Hinchman argued that there are several issues in the report that apply to regulations outlined in town ordinances, and that since Clarke authored key portions of the study, he is the most qualified person to deliver the presentation.

Probert sought a motion from the Board to either continue with the public hearings as scheduled Jan. 28 and 29 or to continue the hearings until Feb. 11 and possibly through Feb. 12 and 13 if necessary.

After some discussion, the Board agreed to continue the hearings until Feb. 11 and keep the possibility of reconvening Feb. 12 and 13 if needed and to forgo having any further hearings this month.

Board member Lee Ann Horowitz suggested the Feb. 13 date be removed from the schedule.

“I think two more public hearings ought to be enough,” she said.

But Probert said he’d like to keep the option to make sure all who wish to speak about the application will have a chance to do so.

“Can we have some commitment that there will be no further hearings after that?” asked Kilbreth.

“We’re not going to give you that commitment,” said Probert.

Probert then asked those who have already spoken on the project to refrain from repeating comments that have already been made at past hearings, and encouraged those who had yet to comment on the project to make it a point to do so.

“It’s the public’s right to be heard and I will not infringe upon that,” said Probert.

Referring to the cancellation of the Wednesday, Jan. 16 hearing, Probert offered an additional suggestion.

“Let’s pray for good weather,” he said.

Debating impacts on property values

Norman Gosline, an appraiser DCP retained to reflect on appraisals some Searsport homeowners have presented to show local property values would see reductions ranging from 25 percent to rendering some homes unsellable as residential properties depending on their proximity to the proposed development.

Gosline, who said he has about 50 years of experience in his field, said he believed there would be “little or no impact” on residential properties, because there is already a tank farm in existence and the proposed development would be sited in an industrial zone.

Gosline said he evaluated the appraisals Searsport resident Jeannie Lucas submitted showing the value of her property at 131 East Main St. dropped more than $100,000 between 2009 and 2012. Gosline said there was some kind of impact “from somewhere, for some reason.”

“Nowhere in this report did I detect what you’re here tonight for,” said Gosline.

Gosline also said his assessment of average property values in Searsport versus those across Waldo County showed the Searsport market improved, with the average home selling for about $126,000 in 2011 versus more than $200,000 in 2012.

“Those are not my figures, they’re all from brokers,” said Gosline.

During cross-examination, Hinchman asked Gosline if he examined the home sales over the last year to see if there were any sales of valuable property that might skew the results, and noted that one of the 15 homes sold in Searsport last year went for $585,000.

“Is that why that year you have an upswing on the chart?” asked Hinchman.

“I only reported the total year end for the community,” said Gosline.

Gosline also addressed the appraisal Searsport resident Tom Gocze submitted to the Board in regard to his restored home at 245 East Main St., which overlooks Long Cove.

At the November hearings, Gocze said he and his wife bought and restored their historic home in 2002 and have since invested $162,000 in the dwelling, which they purchased for $249,000. After consulting with an appraiser and a realtor, Gocze said, he learned that his property could see a loss of up to 50 percent of its value if the tank were constructed as proposed. At that time Gocze said potential buyers have expressed to him they were choosing to look elsewhere because of the possibility of a 22.7-million-gallon LPG storage facility being constructed at Mack Point.

Gosline said he recently visited the Gocze property. He said the top of the tank would be visible over the treeline, and stated that the tank farm is now visible from Gocze’s property. That said, Gosline said the view of the new LPG tank “would not substantially affect” properties like Gocze’s. Gosline also stated taht Gocze bought the property in 2002 knowing he neighbored an industrial zone, but Hinchman noted that the town had not voted to adopt those zoning rules until 2007.

In response to Gosline’s statements that the tank farm is visible from the Gocze property, Gocze stated he cannot see the existing tanks from his house.

Hinchman also questioned Gosline’s ability to testify on the matter as an expert, asking Gosline if he still holds certification as a real estate appraiser in the state of Maine.

Gosline said he voluntarily gave up his Maine certification because he chose to maintain his national-level certification, as the requirements for that are more stringent than they are at the state level. He also noted that while DCP asked him to evaluate appraisals submitted to the Board, he was not asked to render any opinions on property values himself.

Industrial versus commercial

DCP Project Manager David Graham answered questions that had been submitted by the public regarding noise, tree plantings, truck traffic and the placement of buildings on the proposed site — specifically, the administrative building that is currently being proposed for land that is zoned for commercial use rather than industrial activities.

Graham said the building would house a training area, a plant manager’s office, a driver check-in and a staffed control room that would include a computer monitoring system and security cameras for the entire plant.

Planning Board member Brian Callahan asked Graham if he thought the proposed tank facility could be on commercially zoned land, and Graham said it could not, based on his understanding of the ordinances.

Callahan said that, since the administrative building would include a computer that monitors the operations of the plant, it should also be sited in an industrial zone.

“If the computer controls it, it cannot be on commercial land, either, in my opinion,” said Callahan.

Kilbreth argued that having the administrative building in the commercial zone as proposed would be no different than a company like Sprague Energy keeping an office in the downtown area.

“If Sprague had an office building in the downtown and they call in an order to the terminal, it’s no different,” he said.

Hinchman later asked the company representatives to provide answers to questions he posed in November about liability insurance that would help residents in the event of an accident and a decommissioning plan that would require the company to remove the tank if there were no longer a use for it in the future.

Kilbreth said the company is putting together a package that includes insurance information as well as a decommissioning plan, the latter of which Kilbreth said was voluntary on the part of the applicant.

Public offers mixed comments

There was a 20-minute period at the end of the hearing when members of the public were permitted to speak, and some offered very different views about the proposal.

Searsport resident A.J. Koch asked the Board to consider those who wish to continue living and working in town, but have struggled to do so because there are few jobs that pay a livable wage.

“Just looking at the group of people that have been here, we noticed there’s a lot of people, in my opinion, who have too many lawyers in the room,” he said. “Most of the people who have been here have been retired… I’m asking you guys to think about the people in my generation who still have to work.”

Shawn Murphy of Winterport asked the Board to deny the application in the name of preserving the character of the town and the region, adding that he felt this was not the right kind of development for the area.

Importing or exporting?

Thursday night, Jan. 17, Searsport resident David Italiaander, who has experience in international trade, testified about his concern that DCP would eventually use the proposed terminal as an export facility, rather than being limited to an import operation as is stated in the application.

That, said Italiaander, would mean residents would see more trucks from the operation on Route 1 year-round instead of in the winter, as DCP representatives testified at earlier hearings.

Italiaander referenced price trends in the global LPG market and, based on information from the National Propane Gas Association, he said it is far more lucrative to be in the business of exporting LPG. If the terminal were to be solely an import operation, Italiaander noted, DCP would lose $19.5 million annually, based on current and projected market conditions. If the operation were to include the export of LPG, Italiaander said, the company stands to gain $320 million in a year's time.

"Lose a minimum of $3 million a year or make almost half a billion a year. What would you do?" said Italiaander.

Kilbreth asked Italiaander if he really believed the company would chose to move LPG from places like Houston to Maine when it  has other terminals in Chesepeake, Va., and Portsmouth, N.H. Kilbreth added, because of the way the proposed facility is designed, it could not serve as an export facility.

"This idea is just a non-starter," said Kilbreth.

Italiaander disagreed with that assessment.

"It's exactly the same thing, but in reverse," said Italiaander.

Probert asked Graham if the company would be agreeable to having its application include a condition that the facility always remain one that deals in only imports.

"I can't answer that," said Graham.

"That's what we're applying for," added Kilbreth.

'The town with the tank'

Italiaander also spoke about the difficulties he's experienced with finding new tenants for the old bank building on Main Street, a historic structure that is more than a century old. The building was formerly home to Left Bank Books, a business Italiaander said moved to Belfast after the owners learned of the tank.

"The decision was made for them," said Italiaander, noting that Searsport is already becoming known as "the town with the tank," and it has been hard to find potential tenants who want to start a business in town. In addition, Italiaander said, he is concerned about what the increased truck traffic would do to the aging building, particularly to its foundation.

Belfast-based real estate broker Elaine Tucker testified about the development's potential impact on local property values. She said depending on the type of property up for sale and its proximity to the tank site, values could drop between 25 and 50 percent. In cases where a home neighbors the terminal, Tucker said, those homes may not be saleable as residential properties.

"Buyers don't want to see a tank that size in our communities," she said.

"As opposed to the existing tanks?" countered Kilbreth.

"They don't mind the existing tanks," said Tucker.

Kilbreth then questioned whether news of the Good Harbor study could be blamed for the perceptions of buyers, but Tucker said buyers had been expressing concern about the tank to her for more than a year.

Mark Anderson of the University of Maine School of Economics told the Planning Board that, based on his research, the project would hurt local and regional tourism now and into the future.

"The visual effect [of the tank] is one that will impact not just tourism in Searsport, but further in the region," said Anderson.

Kilbreth asked Anderson if he disagreed with Nancy Fannon, a consultant whose study found the development would not adversely impact tourism in Searsport because there is already an existing tank farm at Mack Point.

Anderson said he felt Fannon's assessment was faulty, because she failed to note that the proposed tank would be much taller and wider in size and would, unlike the existing tank farm, be visible from Route 1 and across Penobscot Bay.

"It's not visible to tourists, and it's not visible from Penobscot and Casco Bay," said Anderson of the tank farm.

DCP representatives also heard from a professional appraiser that Angler's Restaurant and Bait's Motel proprietor Buddy Hall commissioned to document financial losses he said his businesses have experienced due to the potential development. Kilbreth and the appraiser spent a fair amount of time debating whether losses at Hall's businesses could actually be related to the tank proposal.

Hall's attorney, Ed Bearor, contended that a Facebook campaign launched last March that was aimed at boycotting business owners who expressed opposition or questioned the development could be at least partially to blame for Hall's profits' having declined two percent since 2010, when the tank proposal became public. Bearor provided the Planning Board with snapshots of three Facebook posts, including one from former Searsport Fire Chief Jim Dittmeier, who advised others in town who supported the potential development to "hit [tank opponents] where it hurts, in the pocketbook."

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