PROSPECT — Usually, plans for multimillion-dollar investments in small Maine towns are unveiled with fanfare. This one was posted on a bulletin board at a corner store.
The letter, posted around Dec. 11 at Maddie’s Place, a pizza and convenience store in Prospect, said both wood and workers were wanted for a major new heat-treated wood chip operation to be built in a former gravel pit near Route 1A.
The plan as detailed in the note was ambitious: Logs would come in to Prospect on “enhanced” rail lines from as far away as Millinocket, Jackman, Greenville and Brownville. After being processed and heat-treated to kill pests, the wood chips would be exported to Europe.
Best of all, the facility would be established by early 2015.
The letter definitely caught the eye of loggers and some soon-to-be-jobless Verso Paper millworkers who live in the area. But it also raised eyebrows of some residents in the 700-person town — including those of Selectman Bill Sneed, who decided the letter from Arthur House, president of Maine Woods Biomass Exports LLC, raised a lot more questions than it answered.
“We’ve never talked to Mr. House,” Sneed said this week. “He caught us all by surprise.”
So Sneed and other selectmen decided to call a special meeting and invite House, a Belfast construction manager, to tell them more about his plan.
‘Conceptual project’
During that meeting on Tuesday, Dec. 30, you could hear a pin drop in the community center as House talked the crowd through some of the pertinent points of his plan. He said there are three phases to the project, with the first being $2.1 million in improvements to the tracks and rail facility in Prospect.
“We’ve been working on a conceptual project for about four years,” House said at the outset of the special meeting. “We’re not ready to break ground … What I am trying to make happen earlier is put some people to work who already work in the woods.”
House, a Belfast construction developer with a spotty record of success in Maine, told the crowd of about 50 local loggers, concerned residents, elected officials and others that he intends to employ as many as 150 people by 2016.
In the second, $18 million phase, House intends to build a wood-chipping and heat-sanitizing facility at the former Lane Sand & Gravel Pit near Route 1A. From there, the processed wood chips — “phytosanitized” to kill pests and blights — would be baled and transported by rail to Mack Point in Searsport, where they would be loaded onto freighters and shipped across the Atlantic to European Union markets. The wood chips are a renewable resource in demand in Europe and Turkey, House said.
House said he would like to start work on architectural design and engineering by March 1, 2015, and expects to have the wood chip processing plant built by late 2015 or early 2016.
He told the crowd that because of the closure of Verso Paper in neighboring Bucksport, he wants to start his project by buying wood to make untreated wood chips as soon as next month. House said he has buyers to purchase the product. It was not clear where or how he would chip the wood before he builds his plant.
While his remarks to the crowd seemed long on ideas, he stopped short of sharing details such as exactly how he plans to pay for the multimillion-dollar project, although he did say he has “extremely good” private equity financing. He also told people in the room that he had been given a grant through the Maine Department of Transportation to get started.
Nate Moulton, director of the rail program at the Maine DOT, said House was awarded $750,000 through the Industrial Rail Access Program last summer after stating in his application that he would provide a $1.4 million match in order to rebuild old tracks in Prospect.
Moulton said if House’s rail rebuilding project goes forward, the developer would have to sit down with agency engineers to work out the details and put it out to bid. Ultimately, the state would pay for about a third of the project.
House’s application looked good on paper, Moulton said.
“He was providing new jobs, a large percentage of overmatch, moving a lot of tonnage of wood and doing it without putting a lot of trucks on the road. It’s tied into the port of Searsport, which we like,” Moulton said. “We like projects that incorporate multiple [transportation] nodes.”
House would need to provide details of his finances and the project before the state would commit funds to the project, the DOT official indicated.
‘We chose Prospect’
If House’s wood chip project sounds familiar to folks in the Eastport area, that’s because he came to the Washington County community a few years ago with a similar plan to export heat-treated wood chips from that port. A website for his company, Maine Woods Biomass Exports LLC, still contains the word “Eastport” in its URL.
On Tuesday night, House told the people in Prospect that he had the “opportunity to take this to Eastport, and chose not to. We chose Prospect. We chose Searsport.”
But Chris Gardner, director of the Eastport Port Authority, remembers it differently. Another company was selected to bring sanitized wood chips to that port and work now is moving forward on exporting the product to Europe, Gardner said this week.
“Eastport had talked with Mr. House,” Gardner said. “Ultimately, it didn’t seem to be a fit that would work with Eastport. If he’s able to do something, we know that our friends at the port of Searsport will take good care of him. We wish him no ill will.”
In the last few years, House also has tried unsuccessfully to develop a couple of major projects in Belfast, including on the portion of the waterfront that since has become the Front Street Shipyard. He had an option to purchase the property from former owners Belfast Bridge LLC, according to Belfast City Planner Wayne Marshall.
“He had a concept of how he’d like to redevelop the property,” Marshall said Wednesday. “He worked to make that concept become a reality. But it never rose to the level of coming before the city to make a formal application.”
House did get municipal approval for another project in 2009 — to construct four duplexes on Stephenson Lane in Belfast, Marshall said. Although House did start to build two of the units, ultimately construction stopped when his funding fell through, Marshall said, and the original mortgage holder took the partially completed units back.
“Today, it’s just unused property,” the city planner said.
House said the waterfront project in Belfast ended because the city chose Front Street Shipyard instead. But the housing project failed because of the recession, “when nobody was investing in anything that had to do with real estate. Nobody. In the worst time in the world.”
According to his online resume, House has many years of experience in construction management and development in Maine, Florida and Haiti, with the projects he has worked on totaling $2.5 billion. But his success seemed unclear.
House is proud of the year and a half he spent working on a $1.5 billion plan to help reconstruct and redevelop Haiti after the devastating 2010 earthquake. But Robert Barr, an agriculture expert from Pennsylvania who worked with House, said that corruption in Haiti and a problem with obtaining funding put the brakes on the plan.
“It was a very ambitious plan, to build some new villages and provide housing,” Barr said Friday. “The plan never was implemented. That’s probably why you can’t find anything on it.”
Dorothy Walker of West Palm Beach, Florida, spoke positively about House on Friday. He worked with her on a housing development project in Belle Glade, Florida.
Although the project wasn’t built, she said, House did a great job on helping with its conception.
“He did an excellent job for us,” she said.
According to the Palm Beach Post, however, that project — Abidjan Estates — was in foreclosure in 2011 and $2.4 million in debt. Walker, an attorney, also was permanently banned from practicing law in Florida for her work in connection with the project.
Another Florida developer, Michael Buono of Stuart, said that he hired House as a consultant on a $75 million, pre-2008 Vero Beach housing project that was successful. But another project they worked on together, a condominium in Panama City Beach, didn’t work out.
“He’s got a lot of experience. We’d work with him again,” Buono said of House.
Optimism, reality
Prospect residents present at the meeting said their community definitely could use jobs and economic development. Some did ask the developer questions about the timeline, the environmental impact, the noise and more, but after the meeting was over, many said they were hopeful that the project might lead to work.
“Getting jobs in Prospect is good news. New jobs are hard to come by,” Cliff Alley said.
Selectman Heather Boynton said she would welcome the possibility of having more work in her town.
“With [the Bucksport] mill closing, there’s a large number of people being put out of work now,” Boynton said.
But others said they remain skeptical, including high school English teacher Kathleen Jenkins.
“There’s a lot of unanswered questions,” she said. “I’m remaining open-minded — but a lot of the answers were vague.”
Richard Harriman, who retired from the paper industry, said he has questions about the speedy timeline of House’s plan, especially given the number of state, local and federal permits that will have to be obtained before building such a large facility.
“We worked years on our permits,” Harriman said. “I’m optimistic, too — but then there’s reality.”
Regardless of those concerns, House’s project is speeding ahead.
He has invited loggers and foresters to Union Hall in Searsport on Tuesday, Jan. 6, to meet some of the European and Turkish buyers he said he has lined up to purchase the heat-treated wood chips that will be produced at his proposed plant.
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