Well there is no longer a question about which season we are in. It is clear that it is now summer.
So for those of you who enjoy the warm weather, it has been a real treat.
During the city council meeting on July 8th, we listened to public testimony on the Dol- Soul,
Employment Security building project. At our August 12th meeting the city council will be voting on
amendments to the purchase and sales agreement and the Sears Block tax increment finance (tif)
Sometimes a picture or in this case a chart is worth a thousand words.
The easiest way to explain the city’s costs and what we have and will invest in the property is to
include a chart from a report to the mayor and city council from Matt Walsh:
First let me restate that I did not vote for the city to purchase the DES property. I did vote in
October of 2017 to go ahead with the sale of the property to Dol-Soul. While the city will take a
loss on the money they have put into the building, at the time it didn’t appear there would be a
better offer from another developer. Cut our losses and make up the difference in tax revenue the
project is anticipated to generate.
There are a number of conditions in the purchase and sales agreement. In part, these conditions
will ensure that whoever owns the property will always pay property taxes and if the assessed value
drops below a certain threshold a minimum payment to the city of $490,000. is required through
That brings us to today. A larger and more expensive project than originally proposed. In addition
to the loss of $500,000 from the sale, $300,000 for demolition and $253,333, the pro rated share of
the cost to bury the power lines, the city is now offering up to an additional $3.5 million to
support the projected costs for the developer.
The administration will tell you that by spending over $4.6 million dollars to support Dol- Soul’s
project, that the pay back to the tif district will occur one year earlier than if the project is
But the bottom line is that for ten years (once again) no new revenue will be available for city
wide services, the school district and the county. Those new taxes from the development will be
used to pay for improvements and cost reductions that will make this project profitable for the
Even though the city’s assessed value will increase because of this project, taxes that would
normally go to pay for the same services your property taxes fund are anticipated to not be
available for those services for ten years.
Here are some thoughts for my fellow councilors to consider:
First, when the tif district pays off its debt, the tif district should be closed out. Let’s not
hold open the district - like we have for the Concord Lumber Yard tif district- to fund future
projects that were never anticipated when the district was established.
Second, 50% of the new tax revenues from the district to be directed to pay for city, school and
county services, leaving 50% to pay off the debt. Even if this means extending the payoff period.
As costs for services escalate, when new revenue is not available to pay for these increasing
costs, then those currently paying property taxes will pay for all the additional costs.
Third, a performance bond for a minimum of $4,630,386 to cover all costs the city will have
invested in the project, should the developer default for any reason.
The eighth amendment to the purchase and sales agreement has the city funding up to an additional
$3.5 million for costs associated with the project. This money can be spent before the developer
even purchases the property.
Section 3A.1.3 of the agreement states:
Timing of Seller’s Obligation to Expend Supplemental Seller’s Development
No portion of the Supplemental Seller’s Development Incentives shall be used or
expended until the Closing, unless otherwise mutually agreed to by the Parties
It is anticipated that the project will cost an additional $7 million and the city and the
developer will split those costs. But if the project costs less than $30,400,000, no money will be
returned to the city. Fifty percent of the savings will returned to the city
only for costs less than $23,400,000. That means if the project costs $19.9 million ($3.5 million
less than $23.4 million) the city will get back $1.75 million. But if the project costs $23.4
million no money will be returned to the city. And the city’ $3.5 million will
be spent before the project is completed.
Cost Savings Sharing Provision & Reimbursement to the Seller: (a)Reimbursement to the Seller by the
Buyer: In recognition of Supplemental Seller Development Incentives for the Buyer’s Project, the
Buyer covenants and agrees that if the actual total final cost of the Buyer’s Project is less than
Twenty Three Million Four Hundred Thousand Dollars ($23,400,000.00), then the Buyer, upon demand,
shall make payment to the Seller in an amount equal to fifty percent (50%) of difference between
the actual total final cost of the Buyer’s Project and $23,400,000.00.
Why shouldn’t the city be fully reimbursed for any amount under $30,400,000? According to the
timeline in the Eighth Amendment to the Purchase and Sales
Agreement, the developer (Dol-Soul) won’t be starting the project until at least August
of 2020. If costs have already escalated $7 million, why should we assume that in the current
market that costs for this project will remain stable for over a year?
At our August 12th meeting the city council will also be voting on funding $150,000 of the total
cost of $310,000 to bury power lines in the alley adjacent to the refurbished Concord Theater.
Unitil will pay $110,000 and the developer (Steve Duprey) will contribute up to $50,000.
Duprey has bought the property next to the theater and plans on either demolishing the building or
paying to have it moved. He has already received a permit to demolish the building and the
Demolition Review Committee has ruled that the building is historically and architecturally
Should the city be contributing money towards a project that will result in the moving or
demolition of a building that dates back to 1850; was originally the residence of the baker who had
their bakery in what is now the refurbished theater that sent food goods to Union soldiers during
the Civil War?
For anyone interested in getting into the details of these two projects you can go to the
city calendar and click on the July 8th agenda and read the information from Items 31-F
- 31-J. https://concordnh.legistar.com/Calendar.aspx
And while no public testimony is anticipated to be heard at the city council’s August 8th meeting,
you can still voice your opinion by writing or calling city councilors.
If you would like to contact all the city councilors or have your letter appear on the August 8th
agenda, you can email our city clerk Janice Bonenfant at email@example.com
And as always I can be contacted at:
firstname.lastname@example.org email@example.com or 224-6086
Breaking News from Concord, NH as well as Boscawen, Canterbury, Penacook, Salisbury, Warner and Webster, NH