WATERVILLE -- The fate of a vacant, turn-of-the-century school in a quiet upscale neighborhood is now in the hands of city councilors.

The council on Tuesday will consider changing the zone at the Gilman Street School to allow a Portland developer to restore the building to historic standards and build 33 affordable apartments in the building.

The meeting will be held at 7 p.m. in the council chambers at The Center downtown.

The current zone allows for 28 apartments, but Developers Collaborative says that to make the project financially feasible, it must build 33.

The $10 million proposal has turned an otherwise peaceful neighborhood upside down, with many residents flooding public meetings to oppose the project, saying it will create noise and more traffic and destroy the quality of life they now enjoy.

They don't want a great influx of people -- possibly as many as 100 -- on a block that has already has 25 homes. It could lower property values and increase crime, they say.

To qualify for historic tax credits to restore the building and gymnasium to historic standards, the developer needs to have the project approved in the next few weeks, a deadline residents say is not reasonable.

"I think it's 'haste-makes-waste' and they're just going to shove it down our throat," said resident Lawrence Bloom.

The project

Developers Richard Berman, Jim Hatch and Kevin Bunker have a purchase-and-sale agreement with Brunswick businessman Peter Arena for the 41,000-square-foot school and hope to close on the deal next year at this time.

Eligible apartments tenants are those who earn $20,000 to $36,000 a year -- with a single person earning $20,000 and a family of four, $36,000. Social security benefits would also qualify as income. Rent costs, to include heat, would range from $450 to $750.

The developers say they like Waterville and the beautiful old school. Built in 1913 and eligible for listing on the National Register of Historic Places, the building is worthy of restoration, they say. Otherwise, it will lie fallow.

"The problem is, it might cost $1 million to tear that thing down and cart it away," Bunker says. "The economics are less supportive of tearing it down than anything else."

Bunker says the value of the property now is around $18 million and after being developed, it would be worth around $1.5 million.

"It's going to be tax-paying. It's going to generate significantly more taxes than it is now."

Previous efforts to turn the building into housing for the elderly, or office space, have failed. Like others, Bunker theorizes that if the current project does not fly, hope for the building is lost.

"What'll happen is, it'll sit there and it'll rot," he said. "Somebody will buy it for a song, do minimal renovations -- barely to code -- and run it into the ground for cash flow."

The Planning Board voted 5-2 Monday to recommend that the council approve the zone change. Councilors must take three votes on the proposal. They are expected to take a first vote Tuesday and the final two votes Sept. 16.

If the council OK's the change Tuesday, the Planning Board on Sept. 15 would consider the project under the city's site plan review ordinance, according to City Planner Ann Beverage. Planners will consider everything from parking to water, sewer and sanitary district issues and the public will have a chance to ask questions and give input.

"If the council votes against it, it will be dead," Beverage said. "Probably we won't go to a site plan meeting because the developer said if he can't develop 33 units, it won't be feasible for him to develop this."

Beverage said that if the council approves the plan Tuesday and The Planning Board approves the site plan on Sept. 15, planners' approval would be contingent on councilors taking final votes to approve the zone change Sept. 16.

"It would certainly have to be conditional approval," she said.

The income issue

Boiling at the surface of discussions about the school proposal is a question about income levels of prospective tenants and whether those making $20,000 to $36,000 would take care of the property or create problems.

Some residents say that rental units going for $450 to $750 draw undesirable people; others maintain affordable housing is needed in the city and not wanting it in a neighborhood amounts to elitism and classicism. Bunker says prospective tenants could include first-year teachers or police officers, nurses and those who work in the medical or health-care field.

Mayor Paul R. LePage attended the Planning Board meeting Monday night and said he counted the number of times people referred to the project as "low-income housing."

"It was very disturbing -- very disturbing," he said. "I heard the term 'low-income housing' 17 times and I heard it from the people in the neighborhood. I only heard 'median-income' a couple of times and I tried to explain that difference."

LePage, who grew up poor in a large family in Lewiston and spent part of his childhood living on the streets, says the reality is, probably 90 percent of Waterville residents would qualify to live in the Gilman School apartments (the median household income for Waterville residents was $26,816, according to the U.S. Census).

"I've never forgotten my roots," LePage said. It really, really disappoints me to continually hear 'No' to low-income housing, and it's not low-income housing; it's median income."

Many residents, including Bloom, say it's not about income, but about population density.

"This is not about discrimination against people of lesser means," he said.

Bloom is asking that a neighborhood impact study be done to determine what effect the development will have on quality of life, pedestrian and vehicle traffic, property values, crime, noise and other issues. Planning Board Chairman David Geller and Planner Eliza Mathias agreed with Bloom at the planners' meeting Monday.

"The thought is not to look at this emotionally but let's look at other neighborhoods, other towns, other cities where projects like this have been developed," Bloom said.

Geller said he has a problem with the fact that the developer has a deadline to meet, so there's no time for an impact study.

"If they're good at what they do, they should have anticipated this and they should have had an impact study under way," he said.

Bunker, however, said he is willing to fund something to help clarify the project but he does not know how such an impact study would work. Some things are measurable and some are not -- such as quality of life -- and issues such as traffic and lighting are regulated under city ordinances, he said.

"I was in graduate school for a year-and-a half at Harvard (where he studied urban planning) and I read a lot of those kinds of studies and I know they don't happen because of development proposals," he said. "I can't imagine a scenario where we could do that."

Alternatives

LePage says that he does not think the project will be approved.

"I don't get a vote, but my suspicion is, it's highly unlikely," he said. "They (neighbors) don't want professional offices, they don't want seniors, they don't want affordable housing and anything you do with that building is going to attract traffic."

The alternative, he said, if to raze the school, which once served as Waterville High School.

"I think it would be terrible because it is a beautiful building," he said. "You've got a quality organization going for historic tax credits. This is all the types of things that you would think are perfect."

Bloom doesn't think demolishing the building is the best idea, but it is more desirable than having 33 apartments there. He said he would like to see a development in the building that would have low impact and fit in with the neighborhood, such as six condominiums.

"I think owner-occupied in that neighborhood will keep up the neighborhood, or something with a daytime use -- offices but not big offices. I'd love to see Colby College professor-emeritus offices or something that the public as a whole has access to."

Planner Erik Thomas, who voted to recommend councilors approve the zone change, thinks the current proposal may be the last hope for the building and the city should jump on it.

"Everybody has ideas," he said of possible alternatives, "but ideas don't get us anywhere unless someone steps up with the money to work on something."

How all councilors will vote on the zone change is uncertain. Council Chairman Dana W. Sennett, D-Ward 4, says he plans to approve it because the property already is zoned for 28 apartments and this would be just five more. He also wants to preserve the building.

"The alternatives are to tear it down and sell it as house lots, which I don't think will be financially feasible, or abandon it and leave it as it is," he said.

Councilor Charles "Fred" Stubbert, D-Ward 1, also favors the project.

"I want to see the school preserved and fixed and this developer is offering that possibility," he said. "There are lots of people in the community that have good feelings about that building and they want it preserved."

Councilor John O'Donnell, D-Ward 5, said he is leaning toward approving the zone change, but has not made a decision.

"There are still some questions," he said. "It's a tough issue. The neighbors certainly have strong feelings, but there are some other things to consider."

Councilor Stephen R. Aucoin, D-Ward 7, said he also is leaning toward favoring the plan but wants to urge the developers to have an on-site, live-in manager on the property.

"To me, that's a critical piece, both for the neighbors and for the project," he said.

Councilor Henry Beck, D-Ward 2, said he probably will vote to support the minor zoning change mainly because he believes the city should achieve the policy goal of bringing affordable workforce housing to Waterville.

"In truth, this is a minor zoning change and any other project including 28 new units is possible as of today," Beck said. "I strongly feel that the developers must work with and include residents in project details to allay legitimate concerns raised at the last Planning Board meeting that include Dumpsters, air conditioners and perhaps on-site management."

Phone calls placed to other councilors Wednesday were not returned by Thursday afternoon.

Preservation Management, Inc., based in South Portland, is the management company the developers would use for the apartments.

The company manages 45 properties in Maine and several other states -- with 30 of them in Maine, according to company president, Sheila Malynowski.

Malynowski said the current plan calls for having a manager on-site 16 to 20 hours a week and a person on-call, 24-hours a day. She said the company encourages and helps residents form an apartment association.

She said Preservation Management manages other properties for Developers Collaborative, and she has a lot of respect for Hatch, Berman and Bunker.

"What I like about them is that they take a great deal of pride in the property and want it to be successful," she said. "They're not specifically looking at the bottom line."

She said she is excited about taking on the Gilman project and hopes it is approved. Too often, historic buildings are left abandoned and never restored, she said.

"I just think it's a great thing to do and I think communities really gain from that because it's a piece of history."

Amy Calder -- 861-9247

acalder@centralmaine.com