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Norwich weighs buying marina for $675,000

Norwich - The Marina at American Wharf often is referred to as the city's gem on the waterfront, and now the City Council is considering buying the entire marina for $675,000 to protect the "valuable city asset" from possible closure and to seek either a new operator or another use for the property, Mayor Peter Nystrom said.

Nystrom announced Tuesday that top city officials have been in discussions with American Wharf Development Corp. and representatives of the estate of deceased marina founder Ronald Aliano to have the city acquire the remaining years of the 99-year lease signed by the city in 1987 and purchase all the marina buildings, equipment and land not already owned by the city.

The city owns much of the former industrial wharf land and leased it for 99 years to American Wharf, the chosen preferred developer in 1987. American Wharf added three parcels, including the land where the former Putts Up Dock miniature golf course was located adjacent to the Howard T. Brown Memorial Park. The city would acquire those parcels in the proposal.

The City Council Tuesday will introduce an ordinance bonding the proposed purchase price of $675,000 for the purchase. It will also consider a resolution that would authorize City Manager Alan Bergren to negotiate an agreement with American Wharf Development Corp. for the marina assets.

City records show that the marina is appraised at $2.8 million, but Nystrom said the assessor gave a market value for the entire asset at $3.38 million. The development agreement called for gradual tax and lease payment increases. This year, the marina paid $5,000 to lease the property and another $56,502 in taxes.

American Wharf Development Corp. is wholly owned by Aliano's estate, city officials said.

Michael Aliano, son of Ronald Aliano and president and chief executive officer of American Ambulance, declined to comment on the proposal.

In a news release issued Tuesday, Nystrom said the city was approached by Andre Messier Jr., a local accountant who is executor of Aliano's estate, to discuss the future of the marina. Nystrom said discussions have reached a point where it is "appropriate" for the city manager to begin negotiations if the council approves the move. The council discussed the issue in executive session last Monday, but took no action.

"They basically have come to us acknowledging what the marina has meant to the city and what we're trying to do to revitalize downtown," Nystrom said.

Residents in November approved a $3.38 million referendum bond to launch three downtown revitalization programs this spring.

Nystrom said the estate has tried to find a buyer for the marina, but to no avail. If estate representatives decided to "get out of the business" and close the marina, the marina and buildings could end up in the hands of a bank and the assets could be sold off in pieces, leaving the city with little to market.

In a written statement provided to the mayor's office, Messier said he has to settle the estate, and the representatives offered the city "a brief window" before considering "other disposition" of the property.

"Ron loved Norwich and believed in the potential of its people, architecture and landscape," Messier said. "… Ron would have wanted to give Norwich the ability to direct the future of what was his labor of love, rather than someone from outside of the community who may not understand the importance of this asset to the revival of Norwich."

Nystrom acknowledged that many questions remain unanswered and would be addressed in the negotiations if the council decides to go forward.

While not specified in the proposed ordinance or the accompanying resolution, Nystrom said he hopes the agreement would call for American Wharf Development Corp. to remain in place and operate the marina this year as the city tries to find a new operator or a buyer, or even another use for the property.

Nystrom also envisioned that American Wharf Development Corp. would use the $675,000 to pay its debt obligations, and use revenue from boat slips, rentals, the marina restaurant and other income to support the operation and cover maintenance for the coming year.

Next Tuesday, the council will schedule a public hearing for a future council meeting on the $675,000 bonding ordinance. But residents will be allowed to comment Tuesday on the proposed resolution authorizing negotiations, Nystrom said.

Several aldermen Tuesday said they supported the proposal, agreeing with Nystrom that the city must control the future of the waterfront.

"We just can't let that marina go dark," Alderwoman Deberey Hinchey said.

Council President Pro Tempore Francois "Pete" Desaulniers said he was concerned about potential industrial or other development there, recalling the old coal yard that used to sit on the wharf.

If the city's ownership continues beyond this year, Nystrom said the city could establish a marina authority - similar to the golf course authority - to oversee the property until its future is decided.

"We would be open to other ventures," Nystrom said.

Ronald Aliano for years had wanted to add a hotel and full banquet facilities - beyond the seasonal tent now on the marina - but was unable to realize that goal. A few years ago, a Philadelphia-based developer proposed a high-rise luxury hotel on the marina and adjacent property, but the deal stalled in the recession.

Asked about the city's risk in taking on ownership of a marina in a slow economy with high gas prices, Nystrom said the greater risk could be to let the marina close or be taken over by an out-of-town bank. People's United Bank, based in Bridgeport, holds the mortgage.

"What's the greater risk? What happens if they get out of the business and close it?" Nystrom said.

c.bessette@theday.com

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