Senate committee votes to study $28M bond for Balsams redevelopment plan; future uncertain

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CONCORD, New Hampshire — A state Senate committee on Wednesday recommended more study of a bill to provide a state-backed $28 million bond to help redevelop a storied North Country hotel, dealing a potential setback to the project's backers.

Last week, Les Otten, the Maine businessman seeking to turn the shuttered Balsams resort into a world-class, four-season destination, told a gathering in Dixville Notch that his plan was contingent upon getting the state-backed bond. With the money in hand, he said, construction on the $143 million first phase of the project could begin in June.

On Wednesday, the Senate Public and Municipal Affairs Committee voted 5-0 to send the bill to study. If the full Senate agrees with the committee, the bill would be on hold for the rest of this legislative session but could come back next year.

Senators raised concerns about state taxpayers being on the hook for a private business's loan.

"While we would all like to see the Balsams restored to its former glory and the anticipated economic benefit for Coos County and the state, I have some serious reservations about state taxpayers taking on the responsibility for a private business's loan and the precedent this would create," Senate President Chuck Morse, a Salem Republican, said in a statement.

Sen. Jeff Woodburn, a Democrat who represents the North Country and supports the Balsams project, was confident that once legislators get all the information they need, they'll see the benefit of approving the largest state-backed bond of this sort. It would top the $20 million bond for redeveloping the former Pease Air Force Base.

"In order to revitalize the Balsams, the state has to assume some measured and modest risk," he said. "This is a once-in-a-lifetime opportunity. I've seen the devastation of my county and now we have an opportunity to revitalize it."

The Balsams, where the nation's first presidential primary ballots are traditionally cast, closed in 2010 after about 150 years in business and took with it hundreds of jobs in the North Country region that has struggled to create or keep jobs. Otten's plan would renovate existing buildings, build a 400-room hotel, conference center, spa and retreat. It would also expand the ski area around the inn. Some 1,700 jobs could ultimately be created, according to a study commissioned by the developer. The full project, with an estimated cost of more than $320 million, would be finished by 2024.

A spokesman for the project said Wednesday that the committee vote was not a setback and that Otten still expects to begin construction in June.

"The bottom line is that we understand there are questions and some senators want more information," said Scott Tranchemontagne. "We have a few more weeks to answer questions and provide additional information. Everybody understands that sometimes the legislative process can be a bumpy road and this is part of the process."

Tranchemontagne said he expects Otten will come up with a solution if the legislature ultimately balks at the bond.

"He's a very creative guy," he said.

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