'Game changer' – Impact of planned sale, renovation of Colonial Theater weighed

LACONIA — "A game changer" were the words most often heard following the announcement this week that the Colonial Theater, dark since 2001, would be renovated and reopened as a civic auditorium.

The Belknap Economic Development Council (BEDC) and City of Laconia have partnered to acquire the theater, together with the commercial and residential units on the lot at 609-621 Main St. and during the next 18 months arrange a financial package of $15 million to renovate the entire property, a project expected to be complete by Christmas 2018.

Randy Eifert, president of BEDC, said that when the agency decided to invest in redeveloping distressed property it considered several buildings downtown, but chose the theater, concluding that its renovation and reopening would have the greatest impact.

Jack Dugan, executive director of the Monadnock Economic Development Corporation (MEDC), recalled the experience of Keene where the revitalization of a theater — also named the Colonial —was the first step in the recovery of downtown. Describing the theater as "the centerpiece," adding: "... it is one of the first places we bring people. It's a selling point."

Dugan said that the theater, owned by a nonprofit corporation and operating 364 days a year, enhanced the value of other distressed properties and when the MEDC redeveloped two other buildings, "the momentum began to grow and private developers began to invest." Describing the theater as the "centerpiece," he said that downtown, with its specialty retailers and numerous restaurants has become "a third place where you're not at home or at work but comfortable when you're hanging out."

The construction of what Dugan called "high-end condominiums and rental units," has drawn affluent empty-nesters and young professional families to live within walking distance of downtown. "Success will build on itself," he remarked. "The snowball effect is amazing."

Russ Thibeault of Applied Economic Research explained that in the past downtowns were anchored by department stores which were then eclipsed by several generations of even larger, often discount retailers operating outside city centers where parking was plentiful. Theaters, or cultural and artistic centers, he said, have become the anchors of revitalized downtowns, not only in Keene but also in Concord, Portsmouth and Lebanon, where they have spawned boutiques , cafes and restaurants.

City Manager Scott Myers stressed the assurance that the Colonial Theater would not only change hands but also be restored and reopened within a specific period of time. He said that this signals there are attractive opportunities for potential investors, particularly in the current environment before interest rates and property values have begun to rise.

Myers noted that even before the announcement Charlie St. Clair invested $315,000 in acquiring the former Bloom's Variety Store at the corner of Main and Hanover streets that houses the Laconia Antique Center, and brothers Mark and Chris Condodemetraky bought the Piscopo Block at the corner of Main and Canal streets for $392,500.

These transactions came on the heels of the opening of the Holy Grail Restaurant & Pub on Veterans Square, which marked a major investment in the conversion of the former Evangelical Baptist Church and coincided with the renovation of a rental units on Main Street to house Wayfarer's Coffee Roaster, which opened this week.

John Moriarty of the Main Street Initiative, who purchased and rehabilitated 600 Main Street, has been associated with efforts to acquire and restore the Colonial Theater for years. He recalled that the late, Paul Normandin once reminded him that "it is not fair to think of the Colonial as savior of downtown Laconia. I realize other things have to happen," he continued, "but, renovating and reopening the Colonial will overcome a perception that has overshadowed downtown." He believes that "others will discover what savvy people have known, that downtown Laconia is intrinsically valuable and under-priced."

"It's a beautiful situation that will generate some positive momentum," said Kevin Sullivan, an agent with Coldwell Banker Commercial Weeks Associates, who owns property downtown. He called the Colonial Theater "the highest profile property in the entire downtown corridor" and said that the prospect of its renovation should increase interest in vacant space along Main Street and raise the value of nearby properties. "There is a positive buzz going around," Sullivan remarked.


County faces $80,000 shortfall in health insurance funds (650)

LACONIA — Faced with a possible $80,000 shortfall to cover health insurance costs for county employees, Belknap County Commissioners are encouraging the 30 non-union employees of the county to shift their insurance to a site of service plan from a more-costly HMO plan.

Commissioners say that their plan calls for a 1.4 cost of living increase plus a step increase for eligible employees retroactive to Jan. 1 of this year which would add another 3 percent to their pay.

The county would also pay the entire tab for the site of service plan, which, according to Commission Chairman Dave DeVoy (R-Sanbornton), would reduce the county's costs by $1,374 for a single plan, $3,050 for a two-person plan and $4,119 for a family plan compared to what the county currently pays as its share of the HMO plan.

Currently county employees pay either 5 percent or 6.5 percent of their premiums on the more costly HMO plans, which DeVoy said will subject the county to paying a 40 percent ''Cadillac tax'' on those plans in 2018 unless their costs can be brought down by that time. He says that it is estimated that the tax would $150,000 to the county budget at that time.

Both DeVoy and Commissioner Hunter Taylor (R-Alton) said that they were amenable to a wage increase based on the savings the county will realize by a shift to the a site of service plan and are hoping that many employees will switch over to that plan by July 1.

Currently the county offers two plans, an HMO with a $20 co-pay and a site of service plan with a $1,000 deductible.

The HMO costs $845.19 a month for a single plan, with a weekly payroll deduction of $12.68, $1,690.37 per month for a two-person plan with a weekly payroll deduction of $19.50, and $2,282 a month for a family plan with a weekly payroll deduction of $26.33.

The site of service plan costs $675.77 a month for a single plan, $1,351.55 a month for a two-person plan, and $1,824.59 a month for a family plan. There are no payroll deductions for those plans.

Taylor, who is heading up negotiations with the county's four labor unions, said last week that he is trying to get the HMO changed to a site of service plan in a new contract and has had some success with one of the unions, but that the other three are not looking favorably upon the proposal.

He said that the commissioners should be meeting with the County Convention to discuss the projected shortfall in the near future so that a plan can be worked out to deal with it. ''The longer you wait, the more drastic action will be required. We don't want to wait until August or September,'' said Taylor.

DeVoy said that the commissioners don't want to weaken employee morale with talks of possible layoffs and said that the county budget contains $200,000 in contingency money, a portion of which could be used to fund the projected shortfall.

DeVoy and Taylor suggested that an employee who made $50,000 a year and was on a family plan would realize a $2,200 raise and a reduction of $1,400 in health insurance premium costs, which would help offset the $1,000 deductible in the site of service plan.

Commissioner Richard Burchell (R-Gilmanton) questioned those numbers and cautioned that employees at the top of the wage scale within their bracket might not be receiving enough of a wage increase to cover their increased costs.

He also said that he thinks it is important that the commissioners meet with the convention to discuss the situation, observing that the plan to save the county money on insurance costs can't be put in place without the cooperation of the unions.

DeVoy and Taylor said that they wanted to see every employee come out ahead in the contract negotiations.
''Right now we're bogged own,'' said Taylor, who along with the other commissioners agreed to hold off on hiring for any positions not deemed vital until commissioners know their situation better.

State budget writers defend their work

LACONIA — With the Legislature set to adopt its 2016-2017 state budget and Gov. Maggie Hassan set to veto it, two of its principal architects — Sen. Jeanie Forrester (R-Meredith), who chairs the Senate Finance Committee, and Senate Majority Leader Jeb Bradley (R-Wolfeboro) — have taken to the road in defense of their handiwork.

With the House and Senate expected to approve the budget on Wednesday. Forrester and Bradley spoke to the Laconia Daily Sun yesterday, just days after the legislative leadership announced they would introduce a continuing resolution to avert a government shutdown and the governor urged them to return to bargaining table.

Bradley said that the differences with the governor primarily turned on three issues — the Legislature's determination to reduce business taxes, failure to fund a pay raise negotiated with the State Employees Association and unwillingness to fund the Health Protection Program, which expanded Medicaid.

He stressed that the Senate, with several more months of tax receipts than the House, was able to increase revenue projections by about $120 million and restore many of the cuts to the governor's budget made by the House.

The increased revenues identified by the Senate include increasing the surplus carried forward at the close of the current fiscal year from $34 million to $49 million, while at the same time adding about $13 million to the rainy day fund. The governor has voiced misgivings about both projections.

Forrester, who chairs the Senate Finance Committee, noted that the Senate added $18 million to the appropriation for substance abuse treatment, bringing the total to $42 million, which will be supplemented by $2.5 in federal funding in each year of the biennium. She acknowledged that the $6.7 million appropriated for the treatment of alcohol abuse is less than the $9 million recommended by the governor and the $17 million stipulated by statute, but it is $2.7 more than has ever been directed at the problem.

The budget, Forrester continued, includes a 5 percent increase in the reimbursement rate paid to home health care providers, like the visiting nurse associations and Granite State Independent Living, the first increase since 2004. Bradley remarked that despite an 8 percent increase in the budget of the University System of New Hampshire "they're still mad at us."

"It's a good budget," Forrester insisted. "We've made a lot of compromises."

However, neither senator indicated a willingness to forego reductions in business taxes, to fund the state employees contract or commit to reauthorizing the Health Protection Program.

Forrester said that the Senate decided to reduce business taxes only at the end of the budget process when funds were allocated for other important responsibilities. Although the governor claims the reductions will diminish state revenues by $90 million, Bradley said that claims the cuts are not paid for are not true. He said that Business Profits Tax would be reduced from 8.5 percent -- the highest rate in New England and among the highest in the country -- to 7.9 percent, one-tenth of 1 percent below the rate in Massachusetts, over seven years.

""It's not a philosophical issue," Bradley. "It's a practical issue, a competitive issue." He said that the lower rates would help contribute to retaining and expanding local businesses, adding: "We've never said it's a silver bullet, never tried to oversell it." At the same time, he said that the Senate has taken steps to reduce the cost of workers compensation, electric rates and health insurance to improve the business climate.

Forrester emphasized that measures to ensure local businesses remain competitive are necessary because the private sector generates much of the revenue required to fund the programs and services offered by state government,

Bradley said that the Senate has offered to fund the state employees contract in the second year of the biennium, beginning on July 1, 2016. "The Senate is open-minded to funding the pay raise," he said. "The Republicans are not averse to this, but it's hard to shoe-horn $30 million into the budget."

Both Bradley and Forrester played key roles in introducing the Health Protection Program, which divided the Republican majority and carried the Senate by controversial bipartisan vote in in the Senate last year. The program is set to expire on Dec. 31, 2016. Rather than reauthorize it as part of the biennial budget process, the Republican majority in the Senate preferred to evaluate tits operation and address its reauthorization next year in separate legislation. Bradley said that he intended to sponsor such legislation, adding: "I hope it will be reauthorized."

"I'm cautiously optimistic," said Forrester, who expressed concern about the future of the federal funding to operate the program as it was designed. She also wanted to review the program to ensure that it reduces the shifting of health care costs from the uninsured and under-insured to the private insurance market. "I want to see the numbers," she said.

Anticipating that the governor will veto the budget and conceding the Legislature lacks the votes to override her veto, Bradley said that a continuing resolution will be introduced to keep government operating at current levels for six months. "No one wins in a government shutdown," he said.