EagleTribune.com, North Andover, MA

January 28, 2014

Editorial: City dropped the ball on mill site

The Eagle-Tribune

---- — The fire that destroyed the former Merrimac Paper Co. mill was, as reporter Keith Eddings described it, a disaster a decade in the making.

The only redeeming aspect of this debacle: no one was killed or seriously injured in the Jan. 13 inferno.

That decade is a story of inactivity on the part of both developers and government officials while the property slowly decayed and began to attract vagrants and the homeless. For years, city and state officials allowed tax bills and environmental violations to pile up while taking little to no effective enforcement action. Its would-be developer sought tax breaks but, according to city officials never submitted any substantive plans for the site’s development.

And now, the city of Lawrence may get stuck with the bill to clean up the charred remnants of the once-proud paper mill.

Merrimac Paper once employed 275 people and made 125 tons of high-quality paper a week for clients such as National Geographic magazine. The company managed to hang on longer than most other manufacturers in the city before finally closing and declaring bankruptcy in 2005, with the tax and utility debt to the city just one of more than 300 creditors’ claims.

By 2006, the debt owed Lawrence totaled $3.3 million.

A Haverhill company run by developers Stephen Stapinski of Andover and King Weinstein of Maine purchased the property in 2005 at a bankruptcy auction for $82,500. Stapinski said his plans for the site included restaurants and more than 100 apartments. Stapinski said the city had promised to suspend efforts to collect the tax debt until the property was developed.

“This story is not about me,” Stapinski told Eddings. “It’s about the current owner, about Merrimac Paper closing. The story is about the city not wanting and not allowing the property to be developed.”

The property languished over two mayoral administrations, from former mayor Michael Sullivan into that of William Lantigua.

“Steve Stapinski came to us in 2010 looking for some type of abatement,” Patrick Blanchette, former economic development director in the Lantigua administration, told Eddings. “The Lantigua administration was unwilling to do anything because they had nothing concrete before us and there was no significant promise about the $3.5 million that was owed. There really was no trust, no incentive for the city to work with them.”

As the abandoned mill site became more attractive to vagrants, sporadic fires broke out. The problem became so severe that the city posted an around-the-clock fire watch. By 2007, the debt for the fire watch had grown to $142,000 and also went unpaid.

In 2010, former Lawrence police officer David Padellaro purchased the property from Stapinski’s company for $1 in a deal city officials said at the time was an effort by Stapinski to walk away from his debt.

Enforcement action against Padellaro was no more effective. In November 2010, the state Department of Environmental Protection ordered Padellaro to submit a plan to demolish 9 South Canal St. and the adjacent building at 19 South Canal St. due to environmental hazards. No plan was submitted.

Padellaro now owes the city $5.4 million for unpaid taxes, water bills, fire watches and interest. The city may have to pay to clean up the charred remains of the mill, work that could cost $500,000.

The Merrimac Paper story concisely illustrates the problem with these abandoned mill sites. Millions of dollars in tax and utility debt are carried on the city’s books -- but the debt was accrued by a company that no longer exists. Few developers would show any interest in such a site, unless they would be relieved of the outstanding debt. And the city has no recourse to collect the debt other than to seize the property -- along with its attendant problems of vagrancy and environmental hazards.

A better option would have been for the city to seek out a developer they could work with to restore the site to productive, taxpaying use. Instead, the city did little over two mayoral administration but tally up a nebulous tax bill that never could nor would be paid, all while the site fell into disrepair and eventually, ashes.