If the Whitefield Selectmen are going to asking the voters of the town to consider purchasing the Clary Lake dam, they’re entitled to know how much it’s going to cost, right? You know, the price. That’s a reasonable request, no? Well to that end, the Selectmen handed a  letter to Paul Kelley at the 30 April 2013 Selectmen’s meeting, asking just that question. They asked for a response by the 10th of April. Many of us were there, that was the night the Selectmen held their informational meeting. Well we’ve all been dying for Kelley’s response. Here it is. Spoiler alert: Anyone who expected Kelley to provide an actual price on the dam will be disappointed 🙂

Kelley’s 10 May 2013 Response to Whitefield Selectmen’s request for price of dam

These 2 sentences towards the end of Kelley’s letter more or less sum up the situation for me:

“It is PPM’s understanding that it has the right, under the Abandonment statute, to request “compensation” for the dam. PPM intends to do so, in an amount equal to its associated “costs of ownership” since purchase of the dam from Mr. Arthur Enos in 2006.

PPM considers many of these “costs of ownership” to be proprietary business information, and should the Town wish to secure ownership of the darn via Purchase & Sale Agreement, PPM is prepared to enter a non-disclosure agreement with the Town to fully disclose that information and bargain as to price and terms of sale.”

A non-disclosure agreement? This is so not happening.

A lot of ground was covered in last night’s 2 hour Whitefield Selectman’s special informational meeting. There were 26 people there not including the Selectmen. Paul Kelley was there. I wasn’t sure if he was going to show up. I’m glad he did. These are the highlights of the meeting from my perspective.

• The Selectmen prepared a letter yesterday which they sent to Kathy Howatt of the DEP regarding the pending request by Pleasant Pond Mill LLC (PPM) to be released from dam ownership, noting that a request has been filed with the DEP requesting the petition be denied (that would be my letter dated 29 April 2013). The town’s concern is the considerable effort and expense they have to go through to hold a public hearing on the matter and wondering what the DEP might do about it: Town of Whitefield’s 30 April 2013  letter to DEP about the petition.

• The Selectmen have prepared another letter addressed to Paul Kelley which they signed at last night’s meeting and hand-delivered to him asking him for the cost or price of the dam. Kelley has until 10 May 2013 to respond. At issue is the Town’s need to prepare a warrant for the town meeting and the voters of the town of Whitefield will need to know the cost of the dam. Because of the time required after receiving the information from Kelley, the Selectmen voted to push out the public meeting date to Thursday May 30, 2013. It was going to be May 22nd. Why it is going to take Paul Kelley 10 days to respond to the Town with his asking price for the dam is beyond me.

• I’ve already written in a previous post about Kathy Howatt’s email to Paul Kelley and how the Department has concluded that Pleasant Pond Mill lacks sufficient right, title, and interest to satisfy the statutory requirements for transferring the dam. It turns out the Office of the Attorney General interprets the statute as I do about- that the flowage rights must be included in the conveyance of the dam. Kelley has until May 13th to supply DEP with the requested information. As I see it, this means he’s either got to transfer the flowage rights back to Pleasant Pond Mill and send DEP a copy of a recorded deed to prove it, or he can pick up his bat and ball and go home. That email was subsequently forwarded to the Town of Whitefield and is now public information: DEP Email to PPM requesting proof of sufficient right, title, and interest.

• Paul Kelley said one particularly revealing thing while talking about selling the dam: that Art Enos, the mortgage holder “does not want the dam back” and that furthermore, “Art may get the dam back” and that whomever ends up with the dam will likely end up negotiating with Art over the balance of the mortgage. I can just imagine that Art will be  thrilled- THRILLED I say, to hear this. This statement (which I’m sure Paul wishes he hadn’t made) also corroborates what I’ve been saying all along: that if the it looks like he’ll get stuck owning the dam with a water level order on it, he’ll dump the dam back in Art Enos’s lap. Kelley can’t simply sell (or even give away) the dam because he still owes substantial money on it. This is another reason why Kelley has filed this petition under false pretenses: not only does Pleasant Pond Mill LLC not own the flowage rights, he doesn’t have clear title to the dam itself. He doesn’t so much want release from dam ownership as much as he wants relief from the mortgage on the dam. That should be a private matter between him and Art Enos.

• When asked why he wanted to get rid of the dam, he said Pleasant Pond Mill owns a property with no viable commercial use that is just going to cost money to own and will never make any money.

• Kelley was asked why he split the property (transferred the flowage rights to Aquafortis). Kelley never did satisfactorily answer this question. At least I didn’t understand what he said. He did say that he was advised to do so by a lawyer as if that some how makes it alright. When talking about flowage rights, he did more to confuse the issue than enlighten anyone, talking about “flow rights” vs “flowage rights” vs “water rights” without actually explaining the difference between them. Clearly and attempt to obfuscate the issue. Flowage rights are fundamentally very simple. I understand them.

• In another revealing exchange, Ron Rollins came right out and asked (thank you Ron!) point-blank what does Kelley want for the dam?  Again, Kelley did provide a satisfactory answer. Kelley said that Pleasant Pond Mill “does not hold the mortgage” though nobody seemed to care enough to ask who DID hold it (Kelley’s machinations around who’s who and who owns what is tiresome). I asked what the outstanding balance is, Kelley said he does not know how much the outstanding balance on the mortgage is; that nothing has been paid on it for a long time  and that it has been accruing interest for years. FYI, the original (recorded) mortgage deed specifices an amount of $60,000. We don’t know how much (or how little) Kelley has actually paid on it but the implications of what Kelley said about it is that the sum could be considerably more than the original mortgage.

• Dennis Merrill suggested the town will ask DEP to in effect “stop the clock” on the timing of town public hearing (within 60 days of the filing of the notice of intent i.e., April Fools Day) though it is unclear if DEP has the discretionary authority to make such a ruling.

• There were the usual direct questions about Aquafortis Associates each followed by Kelley’s evasive (and predictable) dodge-ball tactics of talking at length without saying anything. We all know who Aquafortis Associates is, we have the real estate transfer tax form Kelley filed with the Town of Whitefield when the property was transferred to Aquafortis Associates specifying that no transfer tax due because the transfer was a “Conveyance from one LLC to another with same principals.” Who does this guy think he’s fooling? His continued subterfuge around this subject is painful to watch.

• Apparently in an attempt to defend himself against allegations that he is somehow responsible for the ecological and environmental disaster taking place on Clary Lake, Kelley asked if anyone was aware of any illegal activity on the part of Pleasant Pond Mill LLC. This statement out of many that Kelley made during the meeting epitomizes the disconnect between Kelley and everyone else: Whatever has happened, he’s done nothing wrong. He’s broken no laws. He’s committed no crimes. Yes the impact of the draw down on Clary Lake is tragic, but it’s not his fault, he’s done nothing wrong. The loss of wildlife habitat is regrettable, but it’s not his fault, he’s done nothing wrong. This man refuses to assume responsibility for the consequences of his actions. That ought to be a crime.

That about wraps up my reporting. When it was all said and done, nothing substantive was accomplished and the Town is left with more questions than answers, but then it was after all just an informational meeting. If I think of anything else of importance I’ll post it. I’m interested in what other people who were there have to say.

I have formally requested DEP dismiss Pleasant Pond Mill LLC’s petition for release from dam ownership on the basis that they lack sufficient property rights in the dam to transfer it in accordance with the provisions of the statute. MRS Title 38, Chapter 5 §906 (2) “Property rights transferred” clearly states what property and property rights need to be included in the conveyance of a dam. These explicitly include flowage rights. Pleasant Pond Mill LLC does not own the flowage rights. Aquafortis Associates owns the flowage rights. Aquafortis Associates LLC has made no statement about their intent to throw in the flowage rights if and when the dam is transferred.

Letter to DEP requesting PPM petition be dismissed

Some of you will recall that when I filed the Clary Lake water level petition, I named both Pleasant Pond Mill LLC and Aquafortis Associates LLC as parties to the petition for the very reason that Aquafortis Associates LLC owned the flowage rights and that these rights are crucial to the operation of the dam. Despite vigorous protests on the part of Pleasant Pond Mill LLC and their counsel to have Aquafortis Associates LLC removed from the proceedings, DEP upheld my decision to include them in the petition and they remain today parties at interest in that petition. As they should be.

I have no idea if DEP will grant my request to dismiss the petition, but regardless, at least anyone considering taking ownership of the dam will be on notice. Caveat Emptor: Buyer beware.

Last night Ellis Percy and I attended the Jefferson Selectman’s meeting to see what they had to say about Kelley’s petition for release from dam ownership. Whitefield Selectmen Dennis Merrill and Frank Ober were also there as was Shlomit Auciello, reporter for the Lincoln County News. It appears the Jefferson Selectmen haven’t really given this matter a whole lot of thought yet; we did our best to fill them in on what’s happening and why, and what some of their options are. They have a public meeting scheduled for May 21st (details on where and what time at a later date). I expect an there will be an article in the Lincoln County News tomorrow.

Tonight I attended the Whitefield Selectman’s regularly scheduled meeting to see what was happening. There have been some new developments since last week:

1. Dennis Merrill and Tony Marple are to meet with Paul Kelley tomorrow to discuss the dam situation in general and what his intentions are, specifically. Dennis assured me that the Clary Lake Association would get “equal time”, not that I’m worried.
2. The Selectmen have wisely scheduled a public “informational meeting” to discuss Kelley’s petition and what it means for the town. The meeting is next Tuesday night the 30th of April at 7 PM, at the end of their regularly scheduled Selectman’s meeting which is held at the Whitefield Fire and Rescue building on Town House road, next to the Whitefield Town Office.
3. I let them know that the Clary Lake Association will be preparing a formal offer on the dam at our upcoming board meeting this Saturday. I also explained that our offer does not preclude the town or anyone else from making an offer of their own, nor does it relieve the town of the necessity of holding a public hearing on the matter.

I’m hoping for a good turn out for next Tuesday’s informational meeting. I’ve put all the dates on the Clary Lake Association Activities & Events calendar, plus I’ll post a reminder here.

The Whitefield Selectmen at their regularly scheduled meeting last night tentatively scheduled a public meeting for 22 May 2013 at 7 PM at the Whitefield Fire and Rescue building next to the town office on Town House Road. The meeting is to comply with statutory requirements of the recently filed Petition for release from dam ownership, filed by Pleasant Pond Mill on 02 April. The town of Jefferson will be scheduling a similar public meeting, for the same reason. According to the statute (MRSA 38 §§ 901-908) the towns must hold a public meeting to “consider and act” on the issue of owning the dam. Note, this does not necessarily mean the towns have to vote Yea or Nae on owning the dam at this upcoming meeting, the warrant could just call for the formation of a committee to study the issue or to conduct a feasibility study, etc. The statute gives Pleasant Pond Mill LLC (PPM) up to 180 days to consult with various parties on taking over ownership of the dam at which time PPM has to report on the results of their activities. At that time they can if they wish apply for another 180 day extension to continue their search…

Ellis Percy, president of the Clary Lake Association and I attended the meeting last night. The Whitefield Selectmen meet every Tuesday night at the Whitefield Fire and Rescue building from 6 to 8 PM. The Jefferson Selectmen meet every other Monday at the Jefferson Town Office from 6 to 8 PM. Their next meeting is this coming Monday night. These and other important dates are included on the Clary Lake Association’s Events and Activities Calendar.

I went to the Whitefield Selectman’s meeting last night to listen to what they had to say about the Clary Lake dam issue. They discussed among other things the need for the town to hold a public meeting to “consider and act” on the issue of dam ownership within 60 days of being notified of the filing of the petition (April 1st). Per the statute, both the town of Whitefield and the town of Jefferson have to hold these public meetings. Tentative dates were discussed as was the fact that 60 days (now 50) isn’t a lot of time.

At issue is whether or not the town (or towns, with an interlocal agreement)  should own the dam, with or without a maintenance and operations agreement with the Clary Lake Association. The Selectmen agreed that they’d be contacting their counterparts  in Jefferson to discuss this.

The DEP will also further define what constitutes the “costs of transfer” which at a minimum need to be borne by or at least shared by the new dam owner. The actual wording of the statute is:

38 §906. PROPERTY TRANSFER PROVISIONS

1. Compensation. A dam owner is not prohibited from requesting compensation for the transfer of a dam pursuant to this article. The department may not issue a water release order pursuant to section 905 to a dam owner who has refused to transfer the dam to a person willing to assume ownership of the dam because that person refused to compensate the dam owner for the property. The department may not refuse to issue the order if the dam owner requested only payment or a share in payment of the costs of transfer.

“Costs of transfer” to me means the fees to have a title search done, a deed prepared, and the cost of recording it. That’s the beauty of this statute: Anybody can afford to buy a dam 🙂

It was also mentioned that the DEP has determined that the PPM petition is NOT complete as filed. Apparently DEP has questions about who owns what and wants supporting documentation of dam ownership and title. No doubt this has something to do with questions the DEP has over the ability of Pleasant Pond Mill LLC has to meet the provisions of the Statute regarding what property and property rights are to be transferred to a new owner. This should be interesting.

I spoke with Kathy Howatt this morning, she’s the DEP staff person in charge of the Pleasant Pond Mill LLC Petition for release from dam ownership. She said the petition was filed yesterday. This appears to conflict with state law which states that public notice of the intent to file a petition must be published in a paper (and provided to various people including lake shore owners) not more than 30 days before filing the petition. Such notice of intent has not be provided. So much for procedure.

Ms. Howatt said the Department has 15 days to determine if the petition is complete. She also said that the petition for release from dam ownership is completely separate and distinct from the water level petition and that at least for the time being both petitions would both be processed concurrently. However, she said the Department may at some point stay the water level petition proceedings for some specific period of time to provide the Department time to address the petition for release from dam ownership, and for the dam owner to find potential new owners of the dam. She did stress the fact that ultimately the outcome of the water level petition is independent of the outcome of the petition for release from dam ownership. For example, if Pleasant Pond Mill LLC were to find a new owner and transfer the dam to them, they would be off the hook but the new owner would be facing a pending water level order.