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Top 10 Developments in Municipal Law & Economic Development in 2007 – December 10, 2007
2007 was an interesting year for municipal law and economic development in Maine. From early court decisions, to legislative changes, and "firsts" in economic development - the landscape of municipal law and economic development changed considerably for Maine communities in 2007.
Eaton Peabody's Municipal Law and Finance Practice Group, together with Eaton Peabody Consulting Group, has compiled its "Top 10" list of the most significant events that occurred in municipal law and economic development in 2007:
1. First TIF District Approved In Unorganized Territories. 2007 witnessed the first tax increment financing ("TIF") district approved in one of Maine's unorganized territories, to assist in financing the $100 million UPC Wind Power Project on Stetson Mountain in northern Washington County. Although tax increment financing has been used extensively by municipalities, only county governments can establish a TIF in an unorganized territory - which had never been done until this project. Eaton Peabody Consulting Group represented the Washington County Commissioners in the TIF, drafting the county portion of the development program, while Eaton Peabody helped the County Commissioners negotiate the TIF credit enhancement agreement with UPC. Under the TIF development program, the County's portion of new property tax revenues from the project will help fund a variety of economic development initiatives in Washington County.
2. Municipal Boards Can Act Despite a Vacancy. In April 2007, the Law Court issued its decision in Stevenson v. Town of Kennebunk which caused concern among many municipalities and municipal attorneys in Maine. The Court held that where a municipal board is required by statute, charter or ordinance to have a certain number of members and there is a vacancy, the board is not legally constituted and lacks authority to act.
Based on the strong municipal reaction to Stevenson and at the urging of the Maine Municipal Association, the Legislature enacted emergency legislation, effective June 21, 2007, that reversed the Stevenson holding. The new law added a new paragraph 7 to Title 30-A section 2602, expressly allowing municipal boards to act by a majority of their members, notwithstanding an unfilled vacancy. Eaton Peabody's Mike Trainor was among those testifying at the Legislature in support of proposed corrective legislation. Mike's particular concern was about how the Stevenson decision, if uncorrected, might affect the validity of borrowings approved by town and city councils and by boards of selectmen in municipalities where selectmen have borrowing authority.
3. Former Mill Redeveloped to Modular Facility.The City of Brewer, and its redevelopment authority South Brewer Redevelopment ("SBR"), partnered with Pittsfield-based Cianbro to redevelop the former Eastern Fine Paper Mill Site as a modular component construction facility. The mill, once providing 250 jobs to the region, closed in 2004, leaving the 41-acre site on the Penobscot River vacant and available for redevelopment. Cianbro plans to turn the site into a manufacturing facility that will design, engineer and assemble 1,200-ton self-standing steel building frames with piping and electrical channels and employ upwards of 500 people. Eaton Peabody worked with the Brewer City Council, city staff and SBR to negotiate and advance the redevelopment of the project, which involved coordination between several state and federal agencies, including the Maine Department of Environmental Protection, the U.S. Environmental Protection Agency, and the Maine Department of Transportation among others. This project represents a vital economic redevelopment success in 2007 and 2008.
4. A Municipal Employee's Home Can be a Public Building for the Purposes of the Maine Tort Claims Act. In Rodriguez v. Town of Moose River, the Maine Law Court held that where a town clerk was required to perform her duties at her home, due to the absence of a town office, her home was a "public building" for the purposes of a personal injury claim against the town under the Maine Tort Claims Act. The practice of having public officials perform duties out of their homes is a common practice in many smaller Maine communities, but the Rodriguez decision should serve as a warning that if the official's home is routinely accessible to the public for official business, the property should be insured by the municipality and properly maintained as a public building or the town should find a permanent municipal facility for the transaction of official business.
5. County-Based Economic and Community Development. Passed in 2007, Public Law ch. 321 (codified at 30-A M.R.S.A. § 125) provides that the county commissions in all Maine counties have the power to raise, appropriate, borrow and expend money for the purposes of county economic and community development. The bill expanded upon the Legislature's grant of county economic development authority to Piscataquis County in 2003. Eaton Peabody's Erik Stumpfel had a hand in drafting both the 2003 and the 2007 legislation, as a pro bono project.
6. Maine's Informed Growth Act. Maine's Informed Growth Act ("IGA") now requires a "comprehensive economic impact study" be prepared by "a qualified preparer" whenever a large-scale retail development is proposed in a municipality. The IGA requires the municipality to implement the impact study process and is funded from a $40,000 fee assessed to the developer of the project. Due to the signal this new legislation sends to developers, the IGA has had the unintended effect of taking Maine off the radar screens of national and international developers who might otherwise come to Maine, and causing some Maine engineering firms to lay off draftsmen and recently hired employees.
7. School Consolidation. A hot topic among all Maine communities and school administrative districts in 2007 was the School Administrative Reorganization Law. So much has been said about the law that there is little new commentary to be added here, but the law is destined to have significant and far reaching impacts on Maine municipalities.
8. Mandatory Right to Know Training. "An Act to Implement the Recommendations of the Right to Know Advisory Committee" - identified as a state mandate - requires certain elected officials to complete a training course on Maine's Freedom of Information Act within 120 days of taking the oath of office (for new officials), while currently elected officials will have until November 1, 2008 to complete such training. This act applies to selectmen, council members and mayors, but not to administrative boards, such as planning boards, boards of appeal and boards of assessment review. The Act indicates that the training should not take more than two hours, but the advisory committee has not indicated which state agency will conduct the course.
9. Expansion of Pine Tree Zone Benefits to Small and Mid-Size Maine Manufacturers. This Act changes the thresholds for businesses to become eligible to receive the tax benefits associated with locating in a Pine Tree Development Zoning ("PTZ"). Prior to the Act, manufacturers were eligible to participate if they expanded 20 jobs at their location in a PTZ and made $2 million investment in the expansion. The Act reduced the thresholds to 4 employees and $225,000 in investment, respectively, affording greater opportunity to small and mid-size manufacturers who previously did not qualify for PTZ benefits.
10. Limitations on the Use of Outdoor Wood Boilers. Enacted in 2007, Title 38 of the Maine Revised Statutes Annotated § 610-B prohibits the sale or distribution of an outdoor wood boiler after April 1, 2008 unless it meets a Phase I particulate emissions limit of 0.6 pounds per million BTU heat input. A phase II emission limit of 0.32 pounds per million BTU heat input applies after April 1, 2010. In addition, the new law prohibits the operation of an outdoor wood boiler in a manner that creates a nuisance condition. The law also gives the Maine Department of Environmental Protection an oversight role for many of the land use concerns associated with outdoor wood boilers. This law - and the DEP rules - provide a basis for municipalities to use in drafting their own ordinances in this area.
This email alert was prepared by Michael R. Clisham, Esq., Erik M. Stumpfel, Esq. and P. Andrew Hamilton, Esq.
For further information on any of the included topics please contact the Municipal Law and Finance Practice Group at 207-991-0111, or at mclisham@eatonpeabody.com.
This paper is provided as general information, and is not a substitute for legal or other professional advice.