[T]HETFORD — After three years of discussions, research and planning, the selectboards of Fairlee, West Fairlee and Thetford plan to hold special town meetings next month asking for voter approval to take control of a deteriorating dam that controls Lake Fairlee’s shoreline and undertake an $850,000 project to replace it.
Before the bond votes, officials are making their case to taxpayers that if the dam fails and leaves stinking mud flats in front of about $64 million worth of lakefront property in the three towns, the negative impact to property values would hurt all taxpayers, not just those who have homes on the lake.
“This is serious business,” said Frank J. Barrett, chairman of the Fairlee Selectboard and a founding member of the Tri-Town Committee examining the dam issue, “and when you mention there’s $64 million worth of grand list around that lake, people’s eyes get open.”
The dam and a camp house perched on top of it — located on a branch of the Ompompanoosuc River in Thetford — are owned by siblings who live elsewhere in New England. The dam was constructed more than 200 years ago, and rebuilt more than 70 years ago. Engineering studies commissioned by the towns have shown that if the dam is left as is, it’s not a question of if the dam will fail, but when.
Another engineering report asserted that the dam’s failure would shrink the 450-acre lake’s shoreline by about 9 feet, back to where it was in 1797.
Voters are expected to decide May 19 on two questions: to take out a bond to pay for the replacement project, and whether the three towns should to take control of the dam and share in the responsibilities of its upkeep.
All three towns need to approve both questions for the project to move forward. If they do, Barrett said, the dam is expected to be replaced over the course of this summer.
West Fairlee Selectboard Chairwoman Delsie Hoyt said that while she recognizes the lake is a natural resource that should be protected, the biggest driver behind her firm support for the project are the tax projections.
“It isn’t about lake people. It isn’t really about the lake,” Hoyt said. “It is about the tax base, and doing what we need to do to protect the tax base.”
Using a $250,000 home as a comparison marker and assuming an estimated 20 percent to 25 percent drop in lakefront property values if the dam were to fail, the Tri-Town Committee found that the dam’s failure would decrease the municipal tax bills of lakefront property owners by thousands of dollars.
To make up the difference, owners of $250,000 homes that are not on the lake would see their bills increase by up to $112 in Thetford, $128 in Fairlee and $266 in West Fairlee.
By comparison, the estimated annual tax increase on a $250,000 home — lakefront or not — if the 20-year bond were to pass is projected at $18 in Thetford, $23 in Fairlee and $43 in West Fairlee, according to the committee.
Barrett said the estimated potential drop in lakefront property values is conservative and the true effect could possibly be greater.
Who Pays What
At previous town meetings, voters in the towns raised money to have engineering firm DuBois & King study the dam and options to address its problems. Other parties, including the owners of summer camps along the lake, also contributed no-interest loans to a pot that totaled $50,000.
Using that money, DuBois & King estimated the project — including lifting the camp house up off the dam, building a temporary dam, knocking down the old one and constructing a permanent replacement — could cost about $714,000.
The first bid to be opened earlier this month, submitted by South Burlington-based PC Construction, was roughly twice that, at nearly $1.4 million.
The second bid to be opened, submitted by Kingsbury Companies LLC of Waitsfield, was less than half of the first, at a little more than $643,000.
Barrett said there was initially a “very real question” about why there was a such as large discrepancy between the two bids. Officials wanted to make sure “the low bidder’s number was good” and that there was not “something missing,” he said.
Ultimately, though, Barrett said DuBois & King and town officials felt comfortable with Kingsbury’s estimates. Some of the biggest differences in the two contractors’ proposals were that PC Construction had quoted more than three times the cost of Kingsbury for the temporary dam, and more than five times the cost for lifting and resetting the camp house.
Barrett, an architect, said it seemed the two companies “saw the project a little bit differently,” noting that the project is highly specialized because of the presence of the camp house.
“Sometimes it comes down to the psychology of how someone sees it, how nervous they are about the project, how comfortable they feel, how busy they are,” Barrett said.
In addition to the $643,000 quote from Kingsbury, the $850,000 estimate that officials are quoting to voters includes a 10 percent contingency and back pay to cover additional engineering expenses, legal fees and the no-interest loans.
The cost share of the bond is divided based on each town’s percentage of equalized value of lakefront property, with Thetford at 44 percent, Fairlee at 34 percent and West Fairlee at 22 percent.
That makes that the estimated total cost of paying the bond’s principal and interest about $482,000 in Thetford, $373,00 in Fairlee and $241,000 in West Fairlee.
Interlocal Agreement
In the second expected ballot question, each town will be asked to approve a so-called “interlocal agreement” that would allow the towns to take control of the dam from the siblings who currently own it and establish right-of-ways to access it. A new Tri-Town Commission, with representatives from each town, would be formed to oversee dam matters.
In turn, the family — which Barrett said has no obligation to repair the dam — would be able to keep the camp house.
Barrett said the siblings, identified in paperwork as Bryan Gregory and Kim Baker, are descendants of the Malmquist family and live in Maine and Massachusetts.
According to the website of the Lake Fairlee Association, a nonprofit that oversees milfoil treatment on the lake, the dam was built to increase the force of the stream that supplied downstream mills with power. It was purchased by Post Mills sawmill operator Walter A. Malmquist in 1937, according to the Lake Fairlee Association. At one point, amid a dispute over dam repairs with the association, Malmquist is said to have opened the dam and lowered the lake level by seven feet, prompting a lawsuit by the state that forced him to return the lake to its higher levels.
Barrett said the cost for the towns to preserve the camp house, including an estimated $37,000 quoted by Kingsbury to lift and then reset it, and to be able to get the work done are preferable to taking the family to court to try to fight an eminent domain battle that could take years and cost just as much.
Each of the towns will host hearings at 7 p.m. on May 11 at Fairlee Town Hall, Thetford Town Hall and the West Fairlee Community Building.
Maggie Cassidy can be reached at mcassidy@vnews.com or 603-727-3220.
