2026-09-21 - Finance Committee

00:18All right, you are live. Good evening.

00:20Welcome to the regularly scheduled

00:21finance committee meeting. It is

00:23September 21st, 2026. The time is 7:02

00:28p.m. I am chairing tonight's finance. I

00:30am councelor Dean. on finance with me

00:32tonight. We have council Carson,

00:34councelor Foon, councelor Morer,

00:37councelor Beck will be returning in just

00:39a moment. We also have council chairs

00:43and council fish at the table. We are

00:45joined by our student manager

00:49there.

00:50And first up we have bids and purchases.

00:53>> Yes. So the first item is u from the

00:57airport. They're looking for approval to

01:00award a bid for some roof

01:03[clears throat] work um building 100

01:06looking to go with the low bidder

01:10and this one just requires committee

01:12approval.

01:16Any questions? Councor Carson staff

01:18recommendation of

01:20>> second.

01:21>> We are joined by councelor vet. We are

01:24discussing the bids and purchases of our

01:26rooster roof replacement. We have a

01:29[clears throat] motion and a second.

01:35We'll move ahead with staff

01:38recommendation.

01:42Next up, we have sewer software

01:44replacement. This one isn't so simple to

01:46explain. So, I'll proactively invite um

01:50Amanda Smith up to help with this one.

01:54So, looking to award some software and

01:57Jeff two for one.

02:00Some software and I'll allow them to

02:02take it away.

02:06>> Smith, director management. I'm gonna

02:08let Jeff take it and I'll answer

02:10questions if you don't mind. Y so um

02:14engineering and water quality

02:15departments um we've been evaluating our

02:18new pipeline assessment certification

02:20program um currently u the legacy system

02:24is IT pipes um which has required vast

02:27amount of uh administrative overhead and

02:29manual data in integration and it just

02:31hasn't been working for our crews um

02:34Amanda's the sewer [clears throat] crews

02:36they use this to um [snorts] video and

02:39um assess all the sewer lines in the

02:41city, we have a consent decree that we

02:43have to do a certain amount every year.

02:45Um, you know, they have their own TV van

02:47that you you'll see throughout. Um, and

02:50you know, they pop manhandle covers,

02:51they put a little robot in, and then

02:53they they check to see the condition,

02:55age, and all that and the classification

02:57of the um pipe itself. And we use that

03:01[clears throat]

03:02uh review to do our small projects,

03:05repairs, and big capital plant projects.

03:08Well, I'll just jump in and say we

03:11wanted to ensure that we have the

03:14appropriate software as well in place

03:16before we bring to you our proposal for

03:20our new CCTV van. And if you recall

03:23during budget, we talked about how this

03:26is going to be speced out to be a much

03:28more advanced um CCTV system and

03:31ultimately replace the two bands that we

03:34currently so we'll be operating one and

03:37we really need a software that can

03:39support that.

03:41>> So um I'm actually going to bring John

03:44Miller back up here because he's the one

03:45who spearheaded this um campaign

03:50>> at my system. Um, and you can talk about

03:52the full quotes that we received. Um,

03:55kind of what Seward AI is and why we

03:58decided to go with it.

04:00>> Sure. So, do you want me to like explain

04:02what the software does, what it's used

04:03for?

04:04>> Yeah.

04:04>> Okay. Um, so effectively what it's used

04:06for when a man just talking about CCTV

04:09in the CCTV van and what that is is

04:11that's basically a box truck with a

04:14computer in the back and they have a big

04:16spool of cable with a little looks like

04:18a remote control car with a camera on it

04:19and they drive it through all the sewer

04:21pipes, all the storm water. Um, and

04:24essentially an operator is able to

04:26control it and make a note of all of the

04:29defects in the pipes. Um, so anytime

04:31they see cracks or root balls or um, if

04:35there's a service coming in that's got a

04:37lot of water that's infiltrating or any

04:38other issues like that, they log them

04:40and then that's used for QA of the

04:43entire system so we understand what's

04:44going on and prioritizing work and that

04:46sort of thing. Um, and our current

04:48system like Jeff had mentioned, there's

04:49a lot of administrative overhead. um

04:52it's just difficult to work with and

04:53unfortunately the company's uh technical

04:55support is also we end up helping them

04:58more than they help us often um and uh

05:02so we've been looking for a new piece of

05:04software to use um this recommendation

05:07uh came from the Greater Augusta Utility

05:09District I is that where you had

05:11originally heard about okay uh and we

05:13spoke with them um they're very happy

05:14with it they've been using it for a

05:16little while now and we talked to a

05:18couple of other municipalities around

05:19the country who've used it as well and

05:20it's pretty well received. Um, and

05:23essentially what the software does is it

05:26as the [snorts]

05:28the little camera is driven through the

05:30pipes, all that video is recorded, all

05:32of the observations for the defects, all

05:34those things are logged and essentially

05:36it all just gets saved into a database

05:38and then when the truck gets back to the

05:40depot, that information is uploaded and

05:42it becomes effectively a part of the GIS

05:44so that we can go and click on a pipe

05:46segment on a map and understand what its

05:48condition is, view the video, um, and

05:51you know, use that as a part of just

05:53better understanding our sewer network.

05:55Um, so there's a few different software

05:58packages. Um, there's not a lot of

06:01players in this space, but there are a

06:02few. Um, it pipes one of the bigger

06:05ones. Um, but they're also kind of a

06:07legacy. Um,

06:10that they've been around for a while.

06:11They're kind of a headache to work with.

06:13Um, so we talked to a couple of others

06:15in exploring this in addition to to

06:17talking with Super AI. Um, and what we

06:20found was that

06:23while largely they do the same things,

06:27uh, we found that sewer AI has the best,

06:31um, kind of fit and finish general

06:33overall overall performance. Um,

06:37one thing that's a little bit confusing

06:39about it is that is the name itself, a

06:42sewer AI, right? And it's it's not

06:44really AI. Um, so one thing that all of

06:47these software packages have in common

06:49that's going to be a very big step

06:51forward for the city is that they use

06:54machine learning to analyze the images.

06:56Um, and that's been something that we've

06:58been doing for, you know, 20 30 years.

07:00And so effectively what we can do is

07:03after those videos are saved locally, we

07:06can upload them into their system and

07:09they can scan these videos and look for

07:11defects that the operators may have

07:13missed. So, one of the big advantages,

07:16there's a few big advantages here, but

07:17probably the biggest is that operators

07:20are spending less time in the middle of

07:22roads doing these captures. They can

07:25just go straight in, drive through it,

07:27capture the video. They're still making

07:30remarks. They're still catching the

07:31biggest defects. Um, but smaller or more

07:34complex ones are going to be caught by

07:36this system. Um, and then it's not

07:38entirely automated. Um so part of our

07:41requirement is that we use uh NASCO

07:43certified uh systems and software. And

07:47for this machine learning defect

07:49detection to be NASCO certified, the

07:52companies who do it, they still have

07:54another operator go back through and

07:55validate all of the defects found by the

07:58software. So it still has a pair human

08:00eyes on it before we treat it as

08:02authoritative data. Um and then once

08:05that's complete, it gets sent back to us

08:07and then we can use it for um you know

08:10for analyzing our pipe system for just

08:12better understanding what's going on. Um

08:16and then the the software also has some

08:18very useful capabilities as far as risk

08:21modeling. So we're able to specify that

08:24some of our pipe segments are a lot more

08:26critical than others. um you know, so

08:28they have a they serve a very large

08:31population or maybe they're adjacent a

08:33hospital or a school or something like

08:34that and we want to be able to

08:37prioritize if there are issues there or

08:39if there's a pipe that's maybe upstream

08:40of that that we may not otherwise

08:43immediately realize is connected. Um

08:46this software allows us to do

08:48essentially risk modeling. So, um, you

08:51know, when we're budgeting or just

08:53trying to figure out what work we want

08:54to do over a year with, um, all of the

08:57data that's loaded into this

08:58environment, um, we can have a a pretty

09:01good understanding of what our network's

09:04condition is right now and, um, you

09:07know, better be able to kind of

09:08forecast, figure out how we want to

09:09allocate for funds for work that needs

09:11to be done.

09:14I was just gonna say in that particular

09:15component that ability to do that

09:17modeling and forecasting um is one of

09:20the biggest things that set sewer AI

09:22above the others. The others were really

09:23just database programs that allowed you

09:26to view videos and see lists of problems

09:28in a pipe segment. If we wanted to

09:31synthesize the results into a report or

09:33a model, we have to do it manually,

09:34which is what we're doing now. Uh and

09:36it's just a very timeconuming, very

09:38tedious process.

09:40in the city. We don't use of course

09:42super AI but um public works has a

09:44violytics program that it's a camera

09:47that we that we use when I drive over

09:49the roads. It captures it from the video

09:51that they have and we use that to assess

09:53the roadway. So this is this is nothing

09:55new. Um I know the the AI can be scary

09:58but

10:01>> I just wanted to address but Carson had

10:06>> Yes. Um so one clar two questions

10:09clarifying question and then second one

10:10if it's okay but the clarifying question

10:13is um you mentioned all of this data

10:16that's received there's an operator that

10:18reviews all of that that's with the

10:20company

10:21>> that so that that would be with okay

10:23>> y

10:23>> um my second one and this is just more

10:26generally related to security both cyber

10:29security but other types of security

10:31wastewater infrastructure sewer

10:33infrastructure is like the top of the

10:35list for people who want to attack

10:37cities, whether it be cyber or

10:39otherwise. And so with a cloud-based

10:42platform, right, where things are we're

10:44going to be taking videos of our very

10:46precious infrastructure and that's going

10:48to be uploaded and then there's, right,

10:49a downloading process and there's a

10:51company. I'm wondering about the risks

10:54associated with a cyber attack or

10:56violent attacks on our sewer system that

10:58could be facilitated by the fact that

11:00all of this data, this would be very

11:02comprehensive data to somebody who would

11:05want to use it. the wrong way. So what

11:06protections does this company have in

11:09place or that we would have in place as

11:11a city to ensure that this very valuable

11:14data and I can see a thousand reasons.

11:16I'm very excited about this by the way

11:18but that this value the data be for us

11:20and nobody else and not to be used um in

11:24a horrific way. I'll just pop in very

11:28briefly to differentiate we we have what

11:32will be excluded from this is anything

11:35that has equals associated with it. So

11:38um our combined sol overflow controls

11:40anything that has automated um or

11:43controllable gate um pumps things like

11:46that that is still completely separate

11:49and that belongs to our SCADA server

11:52which is not on the internet per se and

11:56not this will strictly be gravity

11:59>> sewer lines. You're essentially seeing a

12:02pipe like this and it's just going from

12:04one segment to the other at the end. I

12:06don't know. Not really sure how you

12:08could use that to attack us. We already

12:11have all the lines on our GIS that

12:13anyway that shows those same line

12:15segments on ground. So, it's just it's

12:17essentially just a one circular pipe.

12:19So, I don't you know I'm not

12:22>> Yeah. No, that's a it's a very big

12:25concern right now. It's been more and

12:26more aggressive lately. So, we had our

12:28entire system through our consulting

12:31years to carve out anything that could

12:34potentially be a concern. it will not be

12:37to this [clears throat]

12:40>> counc

12:44motorized um

12:47is going to significantly impact the

12:50time um you know it'll make it a lot

12:53quicker to be able to assess these pipes

12:56and where you need to focus your

12:58priorities do you have any idea of how

13:01much time you're going to save

13:03>> so we already have the robots we use

13:05those. Now, we already camera and record

13:08it. Um, and [clears throat] right now

13:09that that system, you know, this new

13:12system takes that data quicker and can,

13:15you know, tell if it's a longitudinal

13:17crack or where that crack is, if it's a

13:193:00 or 8:00. It just helps us collect

13:21that that data faster. So, her crew in

13:24the field doesn't have to be out, you

13:26know, in that in that van in a busy

13:28roadway in the middle of the roadway um

13:30trying to get every tiny little crack

13:31from there. They're they're seeing it's

13:34helping save you plan. Okay, got it.

13:37Okay, thank you for that.

13:39>> If I'm not mistaken,

13:42>> we have always exceeded the minimum

13:44requirements by quite a bit even before

13:47we [clears throat] propose this.

13:49>> Yes, we'll just be able to do it more

13:52efficiently with less disruption to

13:54traffic.

13:55>> Yeah, [clears throat]

13:56>> we're still her crew is still looking at

13:58it was NASCO certified. um we have staff

14:01in house that are NASCO certified that

14:03still they'll still be working together

14:05to help u capital plan and it doesn't

14:09take that

14:09>> one of the real time savers is is really

14:11on the back end because it it's going to

14:13help take a lot of the subjectivity out

14:15when we sit down and do our capital

14:17planning every year and there's there's

14:19often disagreement with prioritizing

14:21[clears throat]

14:22where to spend that finite amount of

14:24money that we have every year. This is

14:26really going to help make it a much

14:28easier, more objective conversation.

14:33>> Back.

14:33>> Um, so this

14:35approvals for the first year. Um, how

14:38did that work for the additional year?

14:40That, you know, does it just

14:41automatically renew or does it come back

14:43before this committee like a sole source

14:46approval or how do we if we approve this

14:49piece today, how how does it come back

14:52to us in the future?

14:55>> Yeah. [clears throat]

14:56So, we're not locked into a contract for

14:57one thing, and that's that is a big

14:59differentiator from what we were using

15:00previously. We were in a set five-year.

15:03Um, so with this one, we'll get uh it's

15:05either 60 or 90 days notice before it

15:08expires where we will have the

15:10opportunity to engage with the company

15:11and kind of determine how we want to

15:13continue um whether or not we want to go

15:15with another vendor or whether or not we

15:16want to stick with them. Um, one

15:19particular thing that we made sure of

15:21for all of the companies that we looked

15:22at closely was that uh we would retain

15:25ownership of the data. So even though it

15:27is in the cloud and it's processed in

15:29the cloud, um, as long as our, uh,

15:32contract with them is valid for the, you

15:35know, the one-year period, we can always

15:36get a full export of the raw data back

15:39locally that we can do whatever we want

15:40with. So whether or not we go with

15:42another vendor or go back to it pipes or

15:44whatever, um, we can do that. Um and

15:47then yeah in that that window we can

15:49choose if we want to to stick with them

15:52um or if we want to you know go with

15:54somebody else. Yeah we have we have a

15:56lot of freedom there.

15:59>> And this is something you budget yearly

16:01for

16:02>> anyway.

16:05>> We have no further questions putting in

16:07a motion [clears throat]

16:08>> recommendation second.

16:12Any questions, concerns,

16:16full council?

16:19>> No. Nope. This will be it.

16:21>> Just recommendation.

16:23>> Even better.

16:25>> Recommended. Approved.

16:27>> Thank you.

16:34>> Good night.

16:38Next up, we have a one agreement for 250

16:41H app unit

16:45city manager. You want to answer this

16:47one?

16:48>> Yes. So, this one's pretty

16:50straightforward. We have a homeowner who

16:52has been under a workout agreement with

16:54the city and making the required

16:57payments and is looking to continue

17:00under that same agreement for another

17:03year. Um,

17:06and I'm happy to have our treasurer up

17:09to answer any questions if you have

17:10them.

17:14If any questions regarding this one,

17:18>> just a general question. What's the

17:20interest rate we getting on it?

17:26I know is every year

17:32the current

17:34tax year that's for the current year.

17:37>> Yeah.

17:44You have any other questions regarding

17:45this work out here?

17:51Seeing none, could I entertain a motion?

17:56that we recommend approval work

17:58agreement renewal 250 Hen unit one H for

18:02Angela

18:04second

18:06motion we have a second do not have any

18:09concerns we will go with staff

18:10recommendation for another

18:18nice to see things working

18:22>> unfortunately that is not always the

18:24case so the Next item um is a

18:26recommendation to take possession of a

18:29property 290 Pearl Street that

18:31previously um was within a workout

18:34agreement that has not been successfully

18:36maintained and so now we are

18:38recommending

18:40um that we take possession of the

18:42property. Do you have anything to add on

18:44that?

18:46Not

18:46>> really. I believe the memo covers the

18:49details of what happened throughout this

18:51past year with it.

18:56Fish. Um,

18:59Mr. Tenant was going to offer to list

19:03the property. Um, was there a suggested

19:07list price? It just seems odd that she

19:09had a chance to sell it and maybe

19:11>> we didn't get into that detail.

19:15>> He tried to reach out to her a few times

19:17and was only able to contact once.

19:20>> So, unfortunately, you think she could

19:21have sold it, but something lose it off.

19:30>> Unfortunately, we don't like to see

19:31these things happen, but since she was

19:34not responsive to any of our mailings

19:37and

19:38>> and this is the second property, it is

19:41>> Oh, it is. Okay.

19:46>> Any other questions, concerns?

19:49I entertain a motion.

19:51Move that we forward to the full council

19:55the recommendation of [clears throat]

19:58taking possession of 290 Pearl Street

20:01motion and a second we doubt.

20:14>> Thank you.

20:17And lastly, we're going to discuss the

20:19issuance of the bond for the purchase of

20:24103 main app. Yes. So, you have quite a

20:30lengthy memo on this topic in your

20:33packet

20:35that was sort of precipitated by the

20:37public input that we've sort of already

20:39received on this item. So, the

20:42underlying item is the U bond order

20:46authorization for $1.4 million for the

20:50purchase of 103 Main Avenue. The history

20:54of this property is that um it was some

20:58time ago part of Dao Air Force Base and

21:00then was given to the city. Um there's

21:04one 14,000 square foot building on the

21:07property and then an almost 5,000 square

21:11foot out building. Um all on just over

21:153.5 acres. We sold the building to PCHC

21:20for 1.5 million in 2009. Um and they

21:24committed to make substantial and did

21:26make substantial renovations to the

21:28building following the purchase. Um, in

21:32the deed, the city retained a right of

21:34first refusal. Um, NPCHC has an offer um

21:40and an agreement to sell the property

21:42to, um, Northeast Pain Management for

21:45$1.35

21:48million.

21:49We met previously and discussed

21:53sort of the costs and benefits of

21:54exercising that right of first refusal

21:57and you all authorized me to exercise

22:00that right of first refusal. And so the

22:04process where we are in now is

22:06authorizing an actual bond for that

22:09purchase.

22:12If we complete that purchase, um the

22:14intention would be to move the city's

22:17public health department to that

22:19location from their current almost

22:2212,000 square feet of leased space

22:26located at 103 Texas Avenue. The annual

22:30rent for that spa uh space is currently

22:33$142,000

22:35and is set to escalate over the course

22:38of the next three years. So, we just

22:41renewed that lease. Um,

22:45interestingly on this leased property,

22:47we are basically responsible for all of

22:50the maintenance and upkeep of the

22:52building. Um, except for roof repairs,

22:57the heating system, the electrical

22:59system, and maintaining utility feed uh,

23:02feeds. We're also responsible for snow

23:05removal, parking lot maintenance,

23:07repairs, sidewalks, entrances, etc.

23:12And so we have the figures here um of

23:15the amount of maintenance repair costs

23:17that we have expended on that building

23:19in the last [clears throat] two fiscal

23:21years. Um 25,000 and then 15,000 in the

23:26most recent two years respectively.

23:29Um

23:32it also has some comfort challenges for

23:35our staff. Um it's a very old outdated

23:40uh building. There is um some air

23:44quality issues that we've had to manage

23:47by installing

23:49scrubbers or purifiers. Um there's lead

23:52pipes, so we have to purchase drinking

23:55water for staff. Um, so needless to say,

23:59there's a number of challenges with the

24:01building in addition to the fact that

24:03it's quite expensive leased space. Um

24:07and so when evaluating sort of the costs

24:09and benefits of exercising our right or

24:12first refusal, that was the primary

24:14driver was the opportunity to, you know,

24:17in a worst case scenario break even but

24:21own the building that our staff is

24:23occupying and have them in appropriate

24:25space for them to do their work.

24:33Some other notes about the purchase. Um,

24:36the city doesn't have or at least to my

24:38knowledge the staff that I'm working

24:40with don't really have any ideas or

24:43thoughts for the 4,800

24:45square foot out building. Um, I believe

24:48it's primarily being used for sort of

24:50maintenance and storage right now. I

24:52think the one thing um that we'd have to

24:55be cognizant of for any future plans is

24:57that there is an adjacent daycare. So,

25:02we certainly wouldn't want to plan to

25:03use it for anything that would be

25:05inappropriate for the neighbors. um

25:09using that space

25:13about sort of the the other potential

25:16costs. Um we're not anticipating

25:20significant

25:22bid out costs for this space primarily

25:25because it's being used now exactly how

25:29our staff will use it um should they

25:33move into it as office space. Um,

25:37it will be slightly larger than the

25:40space they're in currently, but not

25:42large enough to contemplate really any

25:44new uses. It will really just be all of

25:47our existing programs moving over to

25:49that new space. Um, and then the other

25:52additional costs that we may incur or

25:54will incur will be moving costs. The

25:57move from Penquist to City Hall was

25:59about $20,000.

26:01It was a several day move. Um, I mean

26:05it's hard to judge, but my back of the

26:07envelope is that we will be looking at

26:09about half of that to move the public

26:11health staff just by way of the fact

26:14that there's far less heavy equipment to

26:16move, for example, all of the printing

26:19equipment that we had to get into our

26:21basement. Um and as was the case when we

26:24moved to city hall um staff basically

26:28moved everything that they could and

26:29then all the movers did was the truly

26:31heavy step.

26:34Some of the public comment that we've

26:35received has been about the possibility

26:37of other buildings and I think this has

26:41been driven by um primarily the

26:43interests of the purchaser um who has

26:46plans for this new space serving

26:48patients and expanding operations. Um

26:52the two other than vacant land, the two

26:54city properties that we have looked at

26:58um or we we really didn't look at this

27:01first one, 50 Cleveland Street, which is

27:02the former DAO Air Force Base. And the

27:05reason we didn't look at that property

27:06is because it's already um

27:10slated for a council approved project um

27:13which is a central kitchen project. That

27:15being said, the central kitchen project

27:17is a full tear down because of the

27:20condition of that building. So, I don't

27:22think we we wouldn't really be looking

27:24at a renovation. We'd be looking at a

27:26complete new build. Um, which I wouldn't

27:29anticipate saving much or anything. The

27:33second property

27:35that has been evaluated is 120 Venture

27:38Way, which until recently was a daycare

27:42um until Penquist relocated to their

27:44brand new daycare. Um we did view this

27:48property several months ago to determine

27:50whether it would be feasible to move

27:52public health here. Um and we determined

27:55that it was not a good option. I think

27:57really because it has been fit out to be

27:59a daycare with little short toilets and

28:02sinks and countertops and big huge

28:04classrooms. Um really every surface

28:07would need to be um would need to be

28:11touched to make it office space. It

28:13would be pretty substantial. Um you know

28:16if we put a million dollars into it,

28:18could we get it there? Maybe.

28:20Unfortunately, the nature of a 30-day

28:22right of first refusal is it doesn't

28:24necessarily allow you to do that robust

28:27analysis. But I think more importantly,

28:29I'm not sure who I would assign that

28:31task to um to to plan that transition

28:36right now given the priorities of our

28:38public health department. Um, so I would

28:40not recommend at this point asking our

28:43engineer or our public health director

28:46to undertake a substantial top to bottom

28:49building renovation to make it work for

28:51them. Um, certainly folks are interested

28:54in the property tax impact. Right now

28:57that property is not taxable um because

29:00PCHC is a nonprofit um and it will

29:03remain not taxable where the city to

29:05purchase it um

29:08were the property to sell to a

29:11for-profit entity. You might use two

29:13different measuring points to estimate

29:15the cost impact. one is the current

29:17assessed value at 1.759

29:20million um which represents about a

29:22$30,000 a year loss and potential future

29:26property tax revenue or if you use the

29:29sale price it would be 23,000.

29:32I think the other relevant fact is that

29:35the p the buildout of a new public

29:38health department um is a component of

29:41the parks and wreck um new facility

29:44buildout that you all have talked about

29:46quite a bit over the last year and the

29:49public health portion of that project is

29:52roughly 4 million. And so that

29:55relocating public health to a new

29:58building would eliminate that component

30:01of the project entirely.

30:05With that, I'm happy to answer

30:06questions. Thank you. I read this cover

30:09to cover all the questions. I appreciate

30:12that. I'm sure the public will also

30:14appreciate. I had one question on

30:20it. The document

30:23speaks to the finance director numerous

30:25times. The finance director is an

30:27interim finance director. Does that

30:28change this document at all?

30:32>> The uh the bond document. Yes.

30:34>> No. No. For for purposes of any legal

30:38document, our finance director is the

30:39finance director who actually happens to

30:42be listening tonight. Um Jody Vney is

30:45our um acting finance director and is

30:49managing both our finance department and

30:51the airport and has come to listen and

30:54learn this evening as well.

30:56>> Thank you. Appreciate that.

30:58>> Councilor Fish, I believe you're first.

31:00>> Um

31:02how old is the building at 103 Lane A?

31:06Do we see any significant

31:09maintenance um issues coming up within

31:12the next three four years? Yeah. So,

31:16it's at least the what 40s.

31:21Um it is an old building and I I think I

31:24put this in the memo. I would never want

31:27to represent to you that this is a

31:29riskfree

31:31proposition. Any $1.35 million

31:35real estate transaction has risk and the

31:39nature of a 30-day right of risk refusal

31:42means that we can't do the level of due

31:44diligence that you would want to do for

31:47a private commercial real estate

31:49transaction of this gravity right so

31:52there is inherent riskman

31:56our public health director has been in

31:58the building and believes it to be in

32:01good condition there is nothing that we

32:03are aware of that would be an issue but

32:07the process doesn't contemplate us doing

32:10the level of due diligence that even I

32:12did when I bought my home. So there is

32:15inherent risk in the transaction.

32:19>> Yes, of course. Um the lease that we now

32:23have relocated

32:25um is that when we we just signed a new

32:28lease, is that for three years or long?

32:30>> It's a three-year lease, but we have the

32:33ability to get out of it with 12 months

32:36notice. And so what we would be doing if

32:39this if council determines that we do

32:41want to finalize the purchase, we'd be

32:43providing notice. Um a component of the

32:47underlying

32:49deal that we are accepting is to give

32:53the seller a sixmonth note cost lease

32:57back. And so for 6 months, the city will

33:01not have access to that property. We

33:04will be closing the sale with cash on

33:07hand and then going out to the bond

33:10market at some point in the spring

33:14to pay ourselves back. And so I would

33:17not anticipate that we would start

33:19making payments

33:22on that bond even in next fiscal year.

33:24It would be the fiscal year after when

33:27we would start making payments. So I I

33:30guess to answer more directly, I don't

33:33anticipate there would be any period of

33:35overlap where we would be both paying on

33:38the lease and paying on the bond.

33:42>> That was a good question first. Did you

33:45hand up?

33:45>> Oh, I don't think so. I did not. I may

33:47have. I forgot.

33:49>> That was a bad human.

33:51>> I just don't know if I'm reading this

33:53wrong. This is one of those things that

33:54feels like too good to be true. But on

33:57the one hand, I'm looking at rent

33:59142,000 and climbing up to 150,000, but

34:02then I'm only looking at the potential

34:04$30,000 in incoming property taxes. And

34:07that just feels like the savings on the

34:09rent just blows that out of the water.

34:12Makes us an incredible deal.

34:14>> I think the thing that to be fair to

34:16account for is utilities. And so the two

34:20so under currently the um

34:24lesser pays for utilities currently

34:26because they're not separated. So they

34:28can't we can't pay for our own

34:30utilities. We will be assuming utilities

34:32on this building and it is

34:36utilities aren't cheap, right? And so I

34:39I would prefer to think of this as you

34:42know at the worst case scenario it's

34:44just a break even. I think that's a fair

34:47way to analyze it. Not analyze it as a

34:51tremendous savings.

34:52>> Sure.

34:52>> Worst case scenario is it's a break

34:54even, but at the end of the day, we own

34:56the building. We're not wasting money

34:59leasing.

35:00>> Well, even if

35:02>> Yes.

35:02>> Yeah. I mean, even a break even, I mean,

35:04we still are coming out ahead. And I

35:06think as much has been made about look

35:08at the taxes we're foregoing and I'm not

35:11seeing that as the big issue is it had

35:15been made out to be based on this memo.

35:19>> I was just going to comment that I don't

35:21see it as a in the worst case scenario I

35:23still don't see it as a break even

35:25because we own the building whereas now

35:28we're paying right releasing and we're

35:31paying rent into a pot of money that we

35:33never see ever again. whenever you're

35:36they're going to want more.

35:39>> Oh gosh. As you know, I'm

35:42[clears throat] an advocate of keeping

35:44Bangor land as much as we can and I

35:48think it's in a great location as

35:50opposed to where our public health is

35:52now. Um, you know, I was hoping that

35:55maybe you tell me they'd have an

35:56opportunity to expand there, but it

35:58sounds like at least the space is

35:59efficient enough and it takes um this

36:03part of the equation off of the wreck,

36:06you know, problem we have so that we can

36:08continue to try to, you know, cut that

36:10budget down and see what we can do now

36:12to try to find out how we can solve the

36:14problem with that. But um yeah, I feel

36:18bad that you know it's um kind of put

36:21pain management

36:23proposition, but it is a first right

36:25refusal. And I know how I felt when I

36:27was at 500 Main Street where the slots

36:29are now. I opened up a little business

36:32called Remax Advantage. And I think uh

36:34just uh signed a 10-year lease and a

36:37year into it, I got the call, you know,

36:39get out of my lease and I was scurrying

36:41around to find a place. you know, at the

36:43time I had 20 agents and three employees

36:46and it didn't feel very good. So, I can

36:48imagine how they feel, but um you know,

36:51there's lots there contributing a lot of

36:53money and I bought a building and it all

36:55worked out. So, um I think that this is

36:58good for the city to pay more for.

37:01>> I would concur that I think this will be

37:04great for us. I just may say one thing.

37:07Um, I know the public is very interested

37:09in in why we want to do this and I think

37:12maybe now they understand the right of

37:14first refusal where it's been explained.

37:16The one thing I think the public does

37:17not understand is that the city does

37:20have money to purchase this property,

37:22but by going up to bond, we're actually

37:25helping public works by allowing them

37:28more grant funding. Isn't that one of

37:31the big reasons? That's one of the

37:33reasons why I think it's smart to bond

37:35this rather than paying cash because um

37:38we you as you know public health is

37:41substantially grantf funded and a huge

37:43component of the way they pay for their

37:46building and their electricity is

37:48through including their costs in um in

37:52those grant funding formulas and using

37:54some of those dollars to pay for

37:56portions of those costs. So, I think

37:58having um this bonded will allow them to

38:01include those amounts within the grant

38:03calculation when they determine those

38:05administrative expenses.

38:09>> Did I see your hand up?

38:12>> And this actually is related to one of

38:14the other properties in your memo that's

38:17currently fitted now for W pikes. But as

38:21just the thought is that as the state

38:24continues to roll out new programs that

38:26impact the school system, right, we're

38:28taking on three-year-olds and other

38:30things. I suspect

38:33um and also with the urgent need of

38:34child care being a a a question, I

38:37suspect that we'll find a use for that

38:40space probably sooner rather than later.

38:42particularly

38:44like I I wouldn't want us to rush to

38:46encourage anybody to remodel that when

38:49there's such an urgent need for services

38:52for children.

38:57>> We have any other comments on this?

39:01What do you look forward to see?

39:02>> So, we need a a committee recommendation

39:06um to include in the council order to

39:08council.

39:11I would like to move that this committee

39:14um forward this recommendation for the

39:16full council or to the full council um

39:19to hold the appropriate public hearing.

39:22>> Second.

39:23>> We have a motion. We have a second. Any

39:25doubt?

39:27We have commitment to move this to full

39:31council

39:34process. No, other than I want to pat us

39:38on the back because I think this is the

39:40earliest we've been done. It is pitch

39:42black out but it is seven [laughter]

39:46o'clock. Yes.

39:49>> With that I believe finance is

39:51adjourned. Good night everyone.

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