Our Katahdin had a busy summer, and we are pleased to share what we've been up to. A few highlights include:
- Paying the back taxes owed to the Town of Millinocket for GNP West in the amount of $160,815.27 to resolve the town liens on the mill property.
- Mailing the payment check to the IRS for the remainder of the $450,000 settlement. The IRS received the check on October 15th and now has 30 days to discharge the lien on the Millinocket mill site property.
- Transporting and refurbishing electric transformers to the Millinocket mill site. These will be critical to stepping down power to distribute electricity to the existing buildings.
- Completing the Brownfield clean-up process at 230 Penobscot, which paves the way for further renovations in the spring.
Our 36th and 37th Community Projects are up on our website. You all make these projects possible. If you have an idea for a Community Project, even if it is just the beginning of an idea, we want to hear it! We can help with project development and creating a budget.
As always, our work is only possible by the many partners, collaborators and supporters leaning in with us. We are grateful to be part of the great work going on in the Katahdin Region.
The Our Katahdin Team
230 Penobscot Update
Our building at 230 Penobscot has had quite a year! Early this spring, 100 students and their chaperones from Casco Bay High School did interior demolition work to prepare the first floor for renovations. In late spring, Safe Environmental Solutions removed the exterior mint green siding and the faux brick siding as part of our Brownfield Clean-up Grant from the Environmental Protection Agency. TRC Solutions is still working with us to wrap up that grant. Over the summer, Our Katahdin worked with Arcadia Designworks, to design a new facade and a phase 1 renovation that will welcome tenants, workers, visitors, and curious passers-by to come inside!
Giving an old building a classy new facelift is not an easy task. We want to re-use what we can to minimize costs and maintain elements of the former building. The look must be classy, and stand up to the test of time for the next fifty years. Based on conversations with locals, the mint green siding had been up for that long. We want to use durable, sustainable materials, and the colors have to be right. Arcadia Designworks worked with us over the summer to design a look that reconnects the top half of the building with the storefront, and highlights our desire to create start-up retail business spaces by distinguishing the left side portion of the building, which originally was an entirely separate building, from the larger storefront.
One of our biggest concerns is ensuring that the building is welcoming to people. We want people to come inside. We want new retail businesses to be successful. We want people coming in from the lakes, or stepping off a trail to be able to quickly feel at ease connecting to high speed broadband in the planned co-working space. This means big, open doors that anyone can enter through. Currently, from the sidewalk there is a slightly sloping short entryway to double doors that open onto a sloped floor. The sloped floor needs to be adjusted to a flat floor to maximize uses in the space. Arcadia designed a new lobby with stairs and a ramp with all ability access to the two planned retail spaces and the coworking space. The last piece of the phase 1 build-out is a bathroom. With the basic needs met, we hope to be able to open the building for tenants after the completion of phase 1.
Unfortunately, phase 1 will not be completed until next year. We are still working through final material budgets, and with a 6-8 week wait time for delivery, winter will likely arrive before the siding does. Before the siding can go up, the existing storefront needs to be removed and made structurally sound. With time of delivery, and contractor availability, the new facade will have to wait until spring.
Interest in the retail spaces and co-working space continues to grow. Our timeline is too slow for some, but hopefully will be just right for others. Our work with Liz Trice of Peloton Labs in Portland on rural coworking spaces was just highlighted at the state conversation on coworking spaces. Our immediate focus is on fundraising and designing the renovation, though we look forward to continuing conversations around building an entrepreneur ecosystem in downtown Millinocket. Have ideas? Want to connect? Stop by the office at 245 Aroostook Avenue in Millinocket and talk with Lucy.
Katahdin Fiber visited Millinocket, East Millinocket and Medway during the Trails’ End Festival and Truck Pulls to start signing up residents who are interested in faster, more reliable internet at a lower cost. They have been working with Our Katahdin and the Katahdin Region Broadband Utility to design and build an open access fiber optic broadband network that will be an essential infrastructure for supporting economic development from at-home momtrepreneurs, to remote workers, to large industrial companies.
Demand aggregation is the first phase of the process where Katahdin Fiber maps out interest. If enough people and businesses express interest in this cutting edge internet option, then construction can begin. Interested? Want to learn more? Check out Katahdinfiber.com for more information and to express your interest.
For more information, check out Neighborly’s blogpost about being the Katahdin Region. Or find Katahdin Fiber on Facebook.
Community Projects Update
Over the past four years, we have seen community members generously support projects that create a sense of pride, clean-up a neglected gathering space, and create hope. Together, we are creating more space for ideas, hope and connectivity between neighbors, friends and visitors alike.
Community projects can be developed by anyone in the Katahdin region. The project must be tangible and considered “one and done”. We’ve moved away from fundraising for events. The maximum budget for fundraising is $2,500. Our Katahdin will work with community leaders to polish your budget, work on language for the website and coordinate volunteers if you need help. Interested in developing an idea? Stop by the office at 245 Aroostook Avenue in Millinocket and talk with Lucy, or drop us a line on our website.
Two community projects are featured on our website currently. Please check them out and support these wonderful projects.
Our Katahdin mails settlement check to IRS
In January of 2017, Our Katahdin purchased the company that owns the former Great Northern Paper Mill in Millinocket, Maine. Purchasing the entire company, including all assets and liabilities, was the only way to acquire the mill site because the site was encumbered with a lien on the property for back taxes owed to the IRS. In exchange for one dollar, Our Katahdin became the sole owner of 100% of the shares of GNP West, the company that owns the mill site. We also became responsible for the $1.5 million debt owed for back taxes from 2014 or 2015, accrued interest and fees.
Immediately, we began the process of resolving the IRS lien. We thought we would be able to plead our case, have the IRS accept our Offer in Compromise, and resolve the lien in six months. Well, it took a little bit longer than that to negotiate the hurdles of the IRS, but after two years of working with officials in Texas, Florida, California, Oklahoma, our appeal landed at the office in New Hampshire. We worked with a woman who is knowledgeable about mill closures, and she listened to us. With a line of credit from Bangor Savings Bank, we were able to conduct a third party appraisal of the property. This appraisal was game changing for us, because it moved the conversation from ping-pong between us and the IRS sharing what we each thought the property was worth, to a common assessment of the value of the buildings and property.
In July 2019, Our Katahdin reached an agreement with the IRS to settle the debt, fees and interest for a total of $450,000.00 that will allow for full discharge of the $1.5 million federal lien on the 1,400-acre former Great Northern Paper mill site in Millinocket.
Support from the Town of Millinocket, Governor Mills and her economic development team, the federal delegation, Eaton Peabody, Bangor Savings Bank and from local business and community leaders in the Katahdin region has been key to finalizing the settlement.
“This settlement allows the redevelopment phase to begin. We will no longer have to focus on cleaning up the past, we can now refocus on building for the future,” said Sean DeWitt, President of Our Katahdin. “And every dollar that we don’t have to spend cleaning up the past is a dollar we can invest to grow jobs and opportunity in the Katahdin region.”
The next step is paying the settlement amount by sending the IRS a check. The Town of Millinocket has secured a line-of-credit with Bangor Savings Bank to be used for economic development. The Town will use this LOC to lend $450,000 to Our Katahdin to resolve the IRS lien. Our Katahdin mailed the final payment in full and the IRS received it October 15th. The IRS has 30 days to discharge the lien.
Upon IRS lien discharge, Our Katahdin will be eligible to deploy its $5.3 million grant from the Economic Development Administration (EDA) that rebuilds and reconnects critical infrastructure on the Millinocket mill site, including power, water, wastewater, road, rail and fiber optic broadband.
Mill Site Update
Since our last update, it seems as though activity on the mill site is accelerating as fast as the leaves in the region are changing color right now!
The mill site has fences for good reason. There are all sorts of dangers on the site. Over the past two years, we have had break-ins and theft. This past summer, a few curious people hopped the fence and explored the Engineering and Research Building. In order to run the halls, they broke windows to gain entry. Millinocket Police officers were alerted and quickly arrived on the scene to find the youth in the building. For restitution, the young men are replacing the windows.
We are sharing this story to help get the word out and to clarify -- we work closely with Millinocket Police Department and we will prosecute.
Direct Sale of Electricity
The Millinocket mill site has many comparative advantages. It’s adjacent to the wood basket and the Golden Road. There is ample land for new development. There’s a rail spur that connects to Searsport. There’s a Municipal airport. The climate is cool. The water is clean and plentiful. And there’s power, power produced right on site.
Brookfield Renewable produces hydroelectric power and currently sells it to the grid. Our Katahdin worked with Bill Ferdinand of Eaton Peabody this past legislative session to secure the potential to sell electricity generated on site to tenants on the adjacent land. In June, Governor Mills signed LD 1173 into law, which means that electricity producers on industrial sites can sell electricity directly to consumers on adjacent land without going through a utility. It secures access to behind the meter power on mill sites throughout Maine working to attract tenants and redevelop shuttered assets.
Infrastructure improvements continue to be front and center as priority projects in order to serve potential tenants. We are working on two key projects - restoring electricity to the Brownfield portion of the site, and beginning the big build-out to the Greenfield to deliver basic infrastructure needs like roads, electricity, sewer, and water.
This summer, in preparation for restoring power to the Brownfield portion of the mill site - which includes the Administration and Engineering and Research Buildings - we purchased four transformers that were going to be scrapped for metal from the East Millinocket mill site. With funds from the Maine Rural Development Authority, we purchased, transported and refurbished a 30/40/50 MVA 34.5 KV/13.8KV transformer, the primary transformer needed to deliver power to the site, and 3 smaller transformers that will be used to step down power further to provide power to different sections of the Brownfield. In August, we secured funding from the Northern Border Regional Commission to purchase additional electrical equipment needed to restore power. The equipment supports re-establishing power to the site based on the completed one-line electricity diagram we commissioned from Mid-South Engineering this spring.
Our Katahdin continues to meet with Brookfield renewable to set the stage for power purchase agreements on the site. Later this fall we anticipate receiving a matrix with indicative power pricing for different industries from Brookfield.This matrix will be very instrumental in attracting tenants.
With the IRS lien in the process of being resolved, we are gearing up for beginning implementation of an almost $7 million infrastructure construction project that will create a hub of essential infrastructure in the Greenfield portion of the mill site on Shack Hill. New tenants will be able to connect to roads, power, sewer and water and have access to acreage. The Economic Development Administration awarded Our Katahdin $5.3 M, and we are required to match those funds with $1.37M. We secured a $500,000 loan from the Maine Rural Development Authority, and are in the process of securing the remaining funds as a loan from the Maine Technology Institute. We are grateful to our partners who are helping us navigate this process.
The first step in beginning the infrastructure build-out is selecting an engineering firm to engineer the electrical, civil, and energy needs and procure materials. The engineering bids must all be approved by the EDA’s engineer before groundbreaking work can begin. The great news is that we received bids from two firms and are currently reviewing them to select an engineering firm. Once a firm is selected initial engineering and permitting can begin!
Our Katahdin continues to engage with potential tenants. We are building relationships with business leaders and statewide entities to share our site attributes and let companies know what we have to offer. We continue to pursue a vision for the site that includes diversified industries that can contribute to each others’ bottom line. For example, one industry - like a data center - may produce excess heat, and may be able to sell it to an adjacent greenhouse that needs heat and can purchase it at a lower cost from its neighbor. We believe using waste streams from one business as feedstock or inputs in another industry will help build a more resilient site.
Building vibrant communities and strong economies takes a village. At Our Katahdin, we are honored to work alongside the numerous local champions that are working so diligently to make the Katahdin Region a wonderful place to live, work and play. To highlight some of the great work going on, we are sitting down with neighbors to hear and share their stories.
This month, we want to extend a warm welcome to Omega Benefit Strategies, LLC, a company that just opened a new office in downtown Millinocket. To learn more, we sat down with Doug Snowman, CEO, and Karyn White, Executive Vice President.
Share a brief introduction to your business and what you do.
Doug: Omega Benefit Strategies, LLC (OBS) is a provider of HR administrative services to employers and insurance companies across the country. Products and services such as the administration of HSAs, Flexible Spending Accounts, COBRA and insurance premium billing services will all be occurring right on Penobscot Ave. in Millinocket. Some of the types of clients that OBS works with include City of Boston, JB Hunt Motor Carrier Services, AFLAC plus numerous other insurance companies, labor unions and employers across the country.
Karyn: Omega Benefit Strategies, LLC was founded in 1990 by Doug Snowman and is headquartered in beautiful Falmouth, MA. His original vision was to offer high quality Section 125 administrative services to small and mid-sized companies in New England. Over the years Omega has expanded services to include COBRA, Commuter Benefits. HRA, Premium Collection & HSA Administration. Today, partnering with producers, insurance carriers & PEO’s, Omega Benefit Strategies offers products and services to over 500 corporate & public sector clients throughout the United States.
Our success has been derived from the quality of our professional staff, coupled with cutting edge technology that allows us to deliver to our customers a very unique user-friendly experience. Our Omega IT Infrastructure and Application Development teams employ the best available security technology and practices to keep your data safe.
What drew you to the Katahdin region?
Doug: I grew up in Medway, Maine, attending Schenck High before leaving for college in Massachusetts in 1982. The Katahdin area really is home for me. I grew up hunting, fishing, hiking, exploring every back trail, lake and pond in the area with my father Paul Snowman and friends like David Powers and Mark ‘Tuna’ Turner. I was fortunate to live in the community at its high point but then also felt the heartache when times turned tough and my father, friends and many family members were laid off at the mills. Needless to say, I have a real affection for the community. When our business started expanding and we realized that the labor pool was unavailable in Massachusetts, the Katahdin area was on our short list. In addition to simply wanting to bring jobs back home, a few things quickly became very clear. As we evaluated different locations along the east coast it became apparent that moving our expansion to the Katahdin area also made the most business sense. The quality of the labor force is excellent, the cost of real estate is reasonable and Deb Rountree’s services at Katahdin Higher Education Center sealed it for us. With all of these resources, I truly believe the Katahdin region is going to experience a rejuvenation in the next 3-5 years.
Karyn: We had originally explored several regions around the country, comparing wage rates and unemployment statistics to determine where we could find a strong applicant pool. The first time we visited the Katahdin region we were blown away by the welcome! The Training resources and support offered by Debora Rountree and the Eastern Maine Community College were unlike anything we found in other areas.
What are your plans for the near future?
Doug: In the very near future I plan to buy more chocolate Donut Holes at the AT Café… they are the best. Other than that… OBS continues to grow revenues and expand its workforce. We’ve hired six people locally so far this year and plan to double that number early next year. By early 2020 we’ll have a certification program in place with Deb Rountree enabling an efficient training platform for the new hires joining OBS. With our current growth trends we expect to employ approximately 70 people by the end of 2023… perhaps more. Also, by this time next year we hope to be in our permanent home at 122 Penobscot Ave. in Millinocket. John and Jess have been great at Designlab hosting us on the second floor for our first year but I’m sure they’ll be ready to see us move across the street.
Karyn: We have initially “set up shop” on the second floor of Designlab. This temporary arrangement has given us a chance to hire our first round of employees, start training, get equipment installed and transfer some of the work from our other locations. Lisa McLaughlin has been hired as our Division Manager and is working to get the office up and running smoothly. Our initial staff consists of Consumer Health Driven Plan Claim Specialist and Cobra Plan Specialists.
How do you hope to impact the community?
Doug: In the long term, we’re hoping that OBS can serve as an example to other businesses from outside the area that moving and/or expanding to the Katahdin region is a smart business decision. Of course, attracting more businesses to the area is crucial to improving the overall economy. We’ll also be sponsoring numerous internships for the local high school and college students, providing them an opportunity to work and garner work experience, which they will hopefully use in the region after graduating.
Karyn: OBS looks forward to being involved in the community. We hope to bring more people to the downtown area and spark continued growth for the region. We are projecting continued growth over the next few years and anticipate increasing employment opportunities.
What can the community do for you, or for your new employees?
Doug: We are very appreciative of the support and well wishes the community has provided thus far… sincerely, thank you! So many acts of kindness and cooperation have been extended to us. We just want to work hard and be contributing members of the surrounding communities.
Karyn: Keep Omega in mind as you are planning local activities! All of our employees so far, have been locally hired. While Omega may be new to your area, this is our third location and we are happy to add Millinocket to our list of locations. Local support is always appreciated, and we like to be involved! Sometimes it’s as simple as a hello, other times it may be something more concrete like a parking spot. Either way, we are looking forward to being part of the community.
Is there anything else you’d like to share?
Karyn: Everything we have experienced in the Katahdin region has been warm, welcoming and positive. We look forward to growing our business and helping in a small way to grow the region.
Also, please come to our open house! Please come and join us to celebrate this special occasion, see our new location and meet our team.
Thursday October 24th
135 Penobscot Avenue
Refreshments will be served
Doug: Yes, I’d like to express a thank you to a few people…
Thank you to Mike Faloon for your doggedness and assistance facilitating our expansion into the area. Mike Michaud, Deb Rountree and Mike Elliott, thank you very much for all you’ve done in making sure we have training, educational and other resources available. This was truly the tipping point for us. John & Jess Hafford and Matt Polstein. Thank you for the advice, temporary business home, good food and drink as we’ve moved into the area. Your many kindnesses and generosity with your time are very much appreciated.