[B]ENNINGTON — Two obstacles that have slowed a sale of the Putnam Block buildings to a development group appear close to being removed.
Bill Colvin, assistant director and community development program coordinator with the Bennington County Regional Commission, said last week that an environmental assessment of the downtown block of six buildings on 4 acres raised some significant environmental issues. However, he said those problems were confined to a limited area and “not significant enough to inhibit the sale.”
Another potential hurdle has been a lawsuit over easement issues related to a stair tower and elevator between the former Pennysaver building — part of the proposed sale — and the adjacent Drysdale building, which isn’t included in the proposal and has a different owner.
A proposed settlement involving multiple parties was agreed upon in mid-January, Colvin said, and approval by the court is anticipated.
Meanwhile, the option the Bennington Redevelopment Group holds to purchase the six buildings and land at the town’s Four Corners intersection for $2 million has been extended, Colvin said, adding that an announcement of the sale could come within the next month.
A 90-day extension of the sale agreement with the Greenberg family, which owns the buildings around the historic former Putnam Hotel, was granted in September. The primary reason cited was to allow for more analysis of potential environmental issues.
The Bennington Redevelopment Group had announced in July its plan to purchase and renovate some 200,000 square feet in the structures in a project now estimated to cost more than $50 million. The proposal calls for using both public and private funds, including grants, tax credits, charitable donations and loans.
Bennington also is considering formation of a tax increment financing district around the site, if the town and others in the state can persuade the Legislature to lift a cap on formation of new TIF districts.
A district would allow the town to bond for infrastructure improvements to benefit the site and attract new private development. Under the program, additional tax revenue generated by the new development that normally would go into state coffers could instead be used to pay off the municipal debt.
The town also is considering applying for $1.25 million in grants that would benefit the development project, focusing on environmental remediation, demolition work, rehabilitation of historic structures and other aspects.
The buyers have said they plan a mixed-use development with residential units, restaurants, office and retail spaces. Members of the group include local companies, Southern Vermont College, Bennington College, financial institutions and Southwestern Vermont Health Care.
A 4,500-page report on an environmental site assessment from consultants Sanborn, Head & Associates Inc. was submitted to the state Department of Environmental Conservation in September for a review and suggestions on possible further evaluation of the property.
The lawsuit was filed by Hotel Putnam Buildings LLC, the entity that is the current owner, against Applejack Real Estate, which previously owned the Drysdale and the former Pennysaver buildings and built the stair tower and elevator connector between them.
The Drysdale was not included in a later transfer of the former Pennysaver building.
Colvin said the suit aimed to clarify the easement conditions relating to the stair tower and elevator. A tentative agreement between the named parties — including 17 businesses, the BCRC, which has an office there, and condominium owners — apparently was reached during a Jan. 12 conference at Superior Court in Bennington.
The attorneys for Hotel Putnam Buildings could not be reached for comment.