Conomo Point fate hangs on votes of town, Legislature

The stakes are enormous, including a potential financial windfall for the town, changes to a neighborhood where many of the residents have held property for generations, and better waterfront access for the public.

An annual Town Meeting vote set for May will be one of the final steps in a process that has been 16 years in the making, after the Massachusetts Department of Environmental Protection found in 1996 that the town was out of compliance with Title V, which governs septic systems and wastewater disposal.

For both the town and the tenants of the 103 homes that sit on 123 parcels in the area, the years since have been marked by uncertainty about the future of the neighborhood, which is more than 100 years old.

It could also leave the town in a much healthier financial state.

Residents at Town Meeting will be asked to vote on whether to authorize the sale of property in the southern region of Conomo Point, and also whether to subdivide the northern region, a possible precursor to a plan to sell some properties, lease others, and retain some for public access.

“It’s always been kind of easy to agree on what should happen in the south,’’ said Mark Lynch, chairman of the Conomo Point Planning Committee. “It’s north of Robbins Island Road (the north portion) that’s been the biggest challenge. “

There has also been townwide interest in public access to the waterfront, an issue the town will consider in part based on the response from current tenants.

“We don’t know who’s going to stay and who’s going to want to go,’’ said Jeff Jones, Board of Selectmen chairman, who compared the process to a giant puzzle. “We don’t want to sell everything.’’

The town is hoping the Legislature grants its home-rule petition to give current tenants the right of first refusal to buy properties. “I’m giving it good odds; it just might take time,’’ said Jones, adding that without Town Meeting approval, the town may ask residents to vote on the plan, subject to an exemption. “We’ll be pleasantly surprised if they act on it before then.’’

With each month, the town and Conomo Point tenants have passed another milestone. By Dec. 1, and with extensions until Jan. 1, tenants were required to sign one-year bridge leases (with options for years two and three), which allowed them to continue to occupy the properties while the decision on the future was being made. Quarterly tax bills were due Feb. 1, and the first lease payments are due March 1.

All but three tenants who were offered bridge leases have accepted the leases (two were not offered leases because of “legal circumstances’’ that Jones wouldn’t elaborate on). But many tenants have noted their unhappiness with the new prices, based on town-ordered appraisals, that on average are more than five times what they were paying.

As the town moves forward, there are questions that remain. For instance, who owns the homes and cottages that have been built on the town-owned land? And are the new appraisals unfairly steep, considering that the renters are also paying property tax, or is the tenants’ reaction simply one of sticker shock that comes from the previous, very modest rents that they were paying under two 10-year leases negotiated 20 years ago? Finally, what happens if the Legislature won’t allow the town to offer tenants - who had built or bought structures on the town-owned lots - the chance to purchase the property and instead it goes to the public selling process?

Bob Mauceri, a northern Conomo Point tenant and a North Reading selectman, said he signed the lease, but found it difficult to do without knowing whether he can buy it in the future, and what that price will be. “Some people are already throwing their hands up and saying, ‘Keep your property,’ ’’ he said, noting that his house is in need of repairs, but “I haven’t done anything because of the uncertainty.’’

Tenant Nina Walker said three neighbors, senior citizens, have sold or walked away from their property. “They couldn’t take the stress,’’ she said.

Although the town has stated that its legal opinion is that the cottages are its property, the tenants dispute that. Some also dispute the appraisals used to determine lease prices and registered concern about potential sale prices. Discussions are ongoing between the town and the Conomo Community Services Group.

“These are not mansions in the Hamptons,’’ said Christopher Weld Jr., lawyer for the group. “There are a number of issues that would go into determining how to find a fair method of determining fair market value. Frankly, you’re valuing encumbered land, because it’s encumbered by (assuming that they own the house) their house.’’

For this year, the total taken in by the town for rents will increase dramatically, from approximately $110,000 to approximately $608,000. In future years, rents will increase to an aggregate $811,000 in 2013 and approximately $1 million in 2014. Because of an abatement negotiated 20 years ago, tenants have also paid 70 percent of the land value in real estate taxes each year, and after the current fiscal year, they will pay 100 percent of that portion of the real estate bill.

If the town sells the properties, it could make a windfall. Jones said the sale of southern lots might yield more than $9 million, which selectmen suggested be put in a separate fund. The fund’s principal would be left intact, with interest used for areas such as education or recreation, designated in advance of the fund’s creation. Residents may vote on whether to move forward to create such a fund at the Town Meeting in May. “That sets up a pretty good annuity over time,’’ Jones said.

That measure would also require legislative approval.

The 123 parcels represent roughly 10 percent of the town’s developed lots. Whether the town continues to rent or sells the properties, Jones expects a big impact on the town’s coffers.

“If you look at the numbers, there’s great potential,’’ Jones said. “If done correctly, we could actually lower taxes.’’