Governor failed, leaseholder advocate says

INDIAN PURCHASE 4 – Gov. John Baldacci’s failure to keep a promise has helped pave the way for a massive Cedar Lake land sale that will force the dislocation of many fixed-income retirees, the president of a statewide leaseholder’s association said Wednesday.

Stu Kallgren recalled a conversation he had with Baldacci in August 2006. The lunch meeting at a South Twin Lake camp included leaseholders Al and Bob Mosca, Peter Pray, state Rep. Herbie Clark and Kallgren, the president of the Maine Leaseholders Association, where Baldacci got rather exercised about Maine’s largest landowners, Kallgren said.

“He promised that the leasing situation was going to get taken care of and something was going to get done,” Kallgren said Wednesday. “He made the comment in particular, and he mentioned Brookfield [Power], that ‘these large landowners have made billions of dollars off the state of Maine, and it’s about time that they started giving something back to the state of Maine.'”

Baldacci, Kallgren said, was speaking in support of Clark’s Leaseholders Bill of Rights, which, if it had passed during the last state legislative session, would have offered price controls on leases and other safeguards to help keep leaseholders from being forced to give up their camps.

“Baldacci just plain lied to us. He said something would be done, and they [the Baldacci administration] did absolutely nothing. Zero,” Kallgren said. “This is typical of the Baldacci administration. It’s typical of how they operate.”

Baldacci spokesman David Farmer didn’t deny Baldacci’s alleged statements but expressed dismay at Kallgren’s comments.

“It’s really unfortunate that Mr. Kallgren is taking this attitude. The administration has worked very hard on this issue from 2006 and before, and we continue to work on it,” Farmer said Wednesday. “This is a very complex issue, and calling people names and laying the failure of [not yet finding] a long-term solution on a single person is not helpful.”

As announced Tuesday, five Cedar Lake landowners will sell 78 camps on half-acre to 1 3/4-acre plots and are forcing leaseholders to buy their lots soon or face eviction when their leases expire in about a year.

The offers made to leaseholders vary, but the owners generally seek about $83,500 per lot, minus a 5 percent, 60-day discount, from the leaseholders. The discount and first-purchase option, which landowners were not required to offer, lasts until December. The leaseholders have 90 days to decide.

Don White, president of Prentiss & Carlisle, the Bangor-based forest resource management company that manages the land, called the price a fair-minded attempt to give landowners true value for the land while respecting the rights of leaseholders, many of whom have owned leases for generations.

White predicted that almost all leaseholders would buy the properties, saying many have been pressing for a chance to do so for years.

Kallgren and some leaseholders object to the abruptness, and what they say is the exorbitant price, of the offers. They say the sales will force many retired paper mill workers on fixed incomes off the leased properties without fair compensation for improvements made to the leased land.

“The leaseholders are being extorted,” Kallgren said. “The leaseholders have made the lots as valuable as they are today. They build a nice place up there and these landowners know that they can get just about any money on the land.”

As president of the more than 1,000-member association, Kallgren said he hopes that the Cedar Lake deal would ignite a new fire under the leaseholder’s bill, which Clark hopes to reintroduce during the Legislature’s next session.

He said his organization has been waiting patiently, and working quietly, with state government and landowners for years on this issue without seeing any real results.

“The leaseholder has no rights whatsoever, and Baldacci was supposed to see to it that we get some recognition by the state of Maine. You do pay taxes on your property on leased land,” Kallgren said. “All we want is to be treated fairly.”

Baldacci, Farmer said, shouldn’t be blamed for the failure of Clark’s bill, which died when the Legislature’s Judiciary Committee voted to kill it.

Leaseholders “are asking the state to intervene on a contract between a private landowner and a leasee,” Farmer said. “If you look at the Judiciary Committee, there’s been absolutely no support for the leaseholder’s position.”

LD 1576 offered price controls on leases and other safeguards to help keep longtime leaseholders from being forced to give up their camps. The bill proposed a lease cap of 2 1/2 percent of the fair market value for the real estate.

Property owners argued that the bill’s cap was too low and its guidelines unconstitutionally restrictive, a position the committee supported, so Karin Tilberg, a special assistant to the governor, has been working with staff on a model lease that is part of new legislation, Farmer said.

That legislation could be unveiled at the next legislative session.

“There is no silver bullet to this problem,” Farmer said. “You have leases growing in value exponentially and you have leaseholders that have long-term arrangements. That’s a difficult circumstance. It would be ideal to get all of us to work together to solve this problem instead of calling names.”

Kallgren said he would be happy to see progress on the bill, but hasn’t heard anything from Tilberg.

“She hasn’t talked to us,” he said.