Is Frenchman Bay project too risky for investors?

MDI planning boards' busy week; Cranberry Isles ferry to discontinue

GOULDSBORO - Water temperature in some parts of the Gulf of Maine reached 68 degrees last summer, well above the optimal range in the mid-50s for salmon. Bad things happen when water gets too warm - disease, decline in procreation. At best a salmon farm in the middle of Frenchman Bay will be a seasonal operation.

Would you invest hundreds of millions in an enterprise facing such a future?

QSJ was attempting to find out whether American Aquafarms had closed on its acquisition of the fish-processing plant here, when the Islander reported this week that it had not.

That jostled me to consider such a project from an investor’s vantage point at a time when land-based fish farms are more in favor. Among other factors, land-based farms can control water temperature.

“While the upfront costs and technical challenges of land-based farming may be higher, the daily operational expenses are lower thanks to automation and lower mortality rates from disease,” according to a paper by Allianz Global Investors last July. “Consequently, demand should be further bolstered by increasingly environmentally conscious consumers.”

In Belfast, Maine, Nordic Aquafarms won a major court ruling in October clearing the way for it to begin project planning so it can break ground later this year. Another project in Bucksport by Whole Oceans has received all necessary permits but has yet to break ground.

Rendering of the 54-acre Nordic facility in Belfast, Maine

Nordic will have a capacity to produce 66 million pounds of salmon a year. It has secured financing from Norwegian investors for at least $150 million, the initial cost of construction.

It is unknown how much financing has been committed to American Aquafarms, which wants to build two salmon farms in Frenchman Bay, and why the purchase of the facility here has not closed. Are investors spooked by the overwhelming vote of residents in November to slap a six-month moratorium against operations?

Public opposition is a big risk for investors.

And opposition will not disappear even if AA succeeds in getting permits from the state. For instance a nationwide boycott of genetically altered salmon produced in Canada has already taken hold despite FDA approval. Giant food supplier Aramark announced last year it will not do business with Massachusetts-based Aqua Bounty, which produces the GMO fish.

In November 2020, the US District Court for the Northern California ruled in favor of indigenous people and environmental groups declaring the approval of genetically engineered salmon unlawful, based on several environmental law violations. (Genetically altered fish is also illegal in Europe.)

In-water salmon farming has a host of other risks, Allianz wrote.

“Chief among these are parasitic sea lice. These crustaceans are transferred from wild fish onto healthy salmon, feeding on their skin and blood. As with lice in human populations, high density fish farms make for rampant infestations, and in extreme cases mass mortality.

“Treating sea lice requires the use of harsh chemicals. Over time, the lice have evolved to build up a resistance, necessitating the use of ever harsher treatments. These chemicals are then combined with antibiotics to treat other diseases, impacting the health of both the farmed salmon and – as they wash out to sea – the surrounding ecology.

“Like cows, sheep or any farmed animal, salmon generate excrement. Without proper disposal, the organic matter can build up to levels which destabilize local ecosystems – a process known as eutrophication. As nutrient-rich effluent collects, algae build up and decompose, acidifying seawater and ultimately lowering oxygen content. The result is an acidic, low oxygen environment unsuitable for marine life.”

Allianz favors land-based Recirculating Aquaculture Systems (RAS), which allows salmon to be kept in indoor tanks, with temperature, lighting, waste and even artificial currents controlled.

From the cold, calculating eye of capitalists, in-water salmon farming is a terrible investment. Some think the Frenchman Bay idea by American Aquafarms is a fantasy.

But land-based operations also have their issues.

Up in Jonesport, opposition is building against a Dutch aquaculture company, Kingfish, which wants to produce up to 17 million pounds of yellowtail fish a year.

Its RAS pipes would reach into Chandler Bay. Resident Holly O’Neal, who fishes out of Jonesport for lobster, said, “Once installed, the pipes would suck in 28 million gallons of clean seawater a day along with egg, larval, and juvenile lobster, shellfish, and finfish.

“It also discharges 28 million gallons a day, and the discharge or effluent includes 6.5 million gallons of partially filtered effluent with 1,580 pounds of nitrogen. This nitrogen output is greater than half of the Portland waste water facility’s nitrogen output.”

“How did Kingfish get permission to pump so much nitrogen into Chandler Bay? I discovered during my review that Maine’s Department of Economic and Community Development examined the average income of all Washington County residents, both inland and coastal, and thought it would be advantageous to have Kingfish and its economic promises in our community,” O’Neal wrote.

“However, the number of promised jobs seems very high considering similar facilities. And are Kingfish’s promises really a worthwhile trade-off for the degradation of our community’s water quality and traditional economy that is not only a substantial source of revenue, but also an integral part of our community’s identity?”

O’Neal’s activism prompted the Jonesport Planning Board Tuesday to seek legal opinion on whether the town can require Kingfish to pay for an environmental impact study and what other authority it possessed.

Planning board backs moratorium extension after another combative hearing

TREMONT - The cankered alchemy of the town’s planning board was on full display Tuesday night, and it speaks to whether the town can afford to go unto the breach with its current members and their inability to modernize the zoning code.

It‘s a bigger problem than just a single campground.

The past year exposed the inadequacy of a land-use ordinance written decades ago. The board responsible for its oversight has been unable to discharge any meaningful solution to this problem.

Worse, when citizens intervened, they were met by this board with contempt, hostility and a behavior which can only be described as defensive and juvenile.

Cindy Lawson had just completed her shift as a surgical nurse at the Bar Harbor hospital Tuesday where she provides critical care for her fellow island residents. The mother of two and her husband coordinated the care-taking of their children so that she could dial into the public hearing. Just weeks ago, Steve Lawson had lost his father, one of the most beloved residents of Tremont in a line of Lawsons going back generations.

It didn’t take chairman Mark Good long to berate Cindy Lawson with a hostile line of questioning. He was joined by member Brett Witham. (see above video)

Lawson is the chief organizer of the Concerned Tremont Residents, which conducted a forum last week that drew almost 100 persons. QSJ counted 61 “participants” on Zoom, but many of them were couples.

As Lawson began to explain the forum’s conclusions, Good angrily lashed out at her, saying he wanted specific recommendations, “And I’m not hearing any.”

The QSJ reviewed previous PB meetings and could not find any PB member indicating that the hearing Tuesday was only to hear specific recommendations. Rather, it was actually held to accommodate the recommendation of the town counsel that the planning board be included in the process to extend the moratorium on campgrounds.

Last month, QSJ asked Town Manager Jesse Dunbar why CTR’s request to be placed on the select board’s agenda in December was rejected and he replied:

“Due to the fact that the Planning Board has not even met to have a substantial discussion on the moratorium the Town Attorney advised placing this request on an agenda in early January would be more appropriate, allowing time for some discussion to take place on the Planning Board level.”

Thus the hearings were always intended to consider the moratorium extension and not a specific campground issue.

It’s a tactic similar to the Big Lie: create a false narrative and deny, deflect, divert.

Witham followed Good:

“We actually want some concrete suggestions like you want to eliminate campgrounds? I think, frankly, what I'm hearing is we have more work to do. It feels like what's going on here is where they're looking for an extension to the moratorium and this just kind of heading in that direction.”

Then, as is Witham’s wont, he belittled the CTR forum.

“I mean, this was the opportunity for folks to come and tell us what they want. And kind of what we heard was a little bit about a meeting that took place. That's great community involvement and meetings are awesome. That does not represent the public. You know that these are this forum here is where the public provides their input. And we're not actually getting it.”

Last month Witham, chair of the town’s “comprehensive” plan task force, could barely muster a dozen people - mostly task force members - to join a public forum dominated by him, Good and Lawson Wulsin, another PB member.

Good added Tuesday night:

“What's the process here? The process is the planning board comes up with proposed standards. It then goes to the selectmen. The selectmen then either agree with those and put them on a warrant for a town meeting and the voters approve.

“You guys are fine. You can do whatever you want. That's great. But it has nothing to do with the planning board. We have this public hearing here for you to weigh in and make suggestions about what what we as a planning board should be thinking about and I'm not hearing that.”

How will Tremont voters react to the specter of the two men bullying Cindy Lawson, who is trying to do a job bungled by the planning board? Small Maine towns like their comity, and good manners. The planning board has been anything but that.

After the public hearing ended, the board went on an extemporaneous discussion among its members, launching all sorts of ideas without the benefit of data nor expertise. The board did this in July as well (see video below) as at other times.

Good is an uncurious chairman, an odd attribute for a former journalist. He was uninterested in attending the public forum hosted by CTR, even though it was attended by the AWL applicants. He was uncurious about the poll conducted by Terry DeWan, the land-use expert hired by CTR, and tried repeatedly to cut DeWan short during the hearing.

He was uncurious when resident Chuck Yeiser attempted to speak at a previous meeting. Yeiser is a seasonal resident and a civil engineer who is chairman of the township of Frederick, Pa, with more local planning experience than all the members of the Tremont board combined. He’s also chair of the township’s comprehensive plan task force.

Good is allergic to outside input, preferring to scrum among just the five members to decide future ordinances. He sees this as the PB’s purview solely and clearly resents the citizens’ intrusion.

During a crisis of self preservation, which indeed is what Tremont is undergoing, one would have thought that board members would be a sponge for information and knowledge whether they agreed with them or not, so to best serve the citizenry.

It’s been more than a year since AWL proposed its campground in a largely residential zone. View the July 13 PB working session below to see the dysfunction and indecisiveness.

The idea for a moratorium actually started with the planning board which could not get it by the select board.

The citizens group made it happen.

The planning board discussed asking the select board for money to hire a land-use expert which never happened.

CTR then intervened and hired DeWan.

CTR is seeking a six-month extension of the Moratorium which expires Jan. 29 so it may complete the wording of any proposed change to the land-use ordinance. The planning board voted grudgingly Tuesday to recommend that extension to the select board with Beth Gott as the only opposing vote.

Gott’s construction company is on the record as wanting to do business with AWL, and Beth Gott has been barred from all AWL matters because of the conflict. So why did Good allow her to vote on a issue directly related to AWL Tuesday?

Good is in a bad place. He’s a hammer looking for nails, growling at everything and everyone. He and member Geoff Young got into a tiff at 1:50 into Tuesday’s meeting around language defining campground standards. View the video and decide for yourself whether this group can still function at a high level.

Does the town need new leadership on the planning board? There are several under-used members of the appeals board who would make an excellent chair.

And is the town well served by a part-time code enforcement officer?

The select board is slated to vote on the moratorium extension Thursday at 5 after a hearing, but it has a bigger problem with a cohesive and well-organized citizens group poised to beat on, while the planning board is borne back ceaselessly into the past.

(QSJ has emailed members of the planning board and has never gotten a response.)

Planning board rules quarry owner failed to acquire needed easement

HALL QUARRY - The Mount Desert Planning Board is crawling toward the finishing line in its eight-year quest to resolve a disputed application to restart stone-cutting operations in a residential neighborhood.

It voted 5-0 Wednesday to declare that the business applicant does not possess a qualified easement to maintain the access road into the granite quarry. But it did not reject the application - yet.

The board decided to have further discussion on Feb. 9 to consider additional grounds to deny the permit application, and whether to flesh out its checklist of items in the case, which has its own cart of documents in the municipal offices.

Either way, board chair William Hanley fully expects an appeal process to ensue.

Harold MacQuinn Inc., owner of the quarry, applied for a license to resume quarrying in 2014, prompting a backlash from neighbors.

In June 2017, the Planning Board ruled 4-1 that the quarry had been dormant for so long that it did not qualify for grandfathering.

MacQuinn and Freshwater Stone, which leases the quarry, appealed to the town’s Board of Appeals, which upheld the PB decision. But in October 2018, a judge overturned that ruling.

Last May QSJ reported that board counsel James Collier learned in August 2019 that MacQuinn needed a permanent easement to use the private access road to the quarry but did not disclose it to the planning board until May 2021. Neighbors and other opponents decried that Collier had taken it upon himself to negotiate a settlement with MacQuinn.

“If Collier had not kept the whole road issue secret and hidden from the Planning Board for 18 months, this whole thing might have been over way back in the fall of 2019,” one neighbor wrote in an email to QSJ.

“I wonder how much it has cost the town, the abutters and the other opposition parties (as well as the Applicant) in lawyer’s fees over time?”

Ferry Owner planning to cease operation: ‘The select board has decided’

SOUTHWEST HARBOR - It’s beginning to look less likely that the Cranberry Isles ferry will be operating out of the public Upper Town Dock this summer.

Steven Pagels, owner of the ferry, viewed the decision Tuesday by the select board as a denial of continued operations, albeit with a six-month extension.

Pagels said although he “appreciated the gesture” of the extension to July 11 for continued use of the dock, it wasn’t practical to plan for only part of a season.

“The Selectmen have spoken. They've made their decision. Our company's not going to badger the selectmen,” said Pagels, who is leaving it to others to settle the question of ferry service to the Cranberry Isles from Southwest Harbor.

Pagels this week proposed to rent parking spaces in the old Morris Yacht boatyard at Clark Point and Herrick roads to help relieve problems some claim to exist at the Upper Town Dock. He also said he would be willing to shorten the dockage time on the float for his 50-foot ferry boat. But neither proposal was accepted.

Former Morris boatyard (upper left corner) has space for parking in summer. Upper Town Dock parking lot is on right.

It will be up to “the other parties to bring this up to them, the businesses in town, or the Cranberry Isles,” Pagels said. “But for us, we accept that the Selectmen made a decision. It’s their town and they are the representatives.” There has been a ferry to Cranberry Isles since shortly after World War Two.

Pagels addressed the remarks by resident Mike Sawyer at the select meeting Tuesday about his personal history. In 2014 Pagels lost a lawsuit charging him with sexual abuse and paid $2 million in damages. Sawyer urged the select board not to do business with Pagels.

“You've got a handful of people that have their own agenda, their own axe to grind who can't deal with the merits of the issue, come at it as a personal attack, because that'll get their attention,” Pagels said.

In 2018, Bar Harbor Town Council refused to consider a ferry service to Nova Scotia proposed by Pagels after residents wrote letters complaining of his past history, according to news reports.

Pagels said Thursday that Southwest Harbor businesses will suffer without the ferry service.

Ruth Davis, president of the Southwest Harbor Chamber of Commerce, wrote a letter which was not read at the meeting, stating:

“The Cranberry Cove Ferry (CCF) is an economic seasonal anchor for Southwest Harbor, utilized by hundreds of visitors to the quietside of Mount Desert Island each season. As well as visitors, many residents of Southwest Harbor and the Cranberry Isles rely on the ferry for their ability to commute back and forth and to conduct business.

“The Ferry itself also supports many other businesses in town and on the islands, and contributes to the income of the town as well. The Southwest Harbor & Tremont Chamber of Commerce Board urges the Select Board to allow the ferry to continue its operations as regulated by the Town ordinances, from the Upper Town Dock, as there is no other location the would adequately serve.”

Pagels attended the Harbor Committee meeting Monday and said, “After listening to only one idea – the committee did not want to hear any other ideas from me* ( with the exception of committee chair – Nick Madeira who offered to speak by phone ).”

“The only idea I was allowed to present was that CCF has offered to pay for approximately 6 seasonal parking spaces, if available, at the Town of Cranberry Isles seasonal parking lot in Manset to be offered to the residents of Greenings Island , if they would like to consider using them as a possible option to the Upper Town dock, in an effort to facilitate cooperation.”

“I have additional ideas to help manage the Upper Town Dock parking lot if anyone wants to listen.

“Otherwise the ferry loses its location at the Upper Town dock that has been in use for over half a century for ferry service to the Cranberry Isles.” Before CCF, another ferry boat operated in an unbroken string of service to Cranberry Isles for more than 75 years.

Cruise ship company found guilty again for pollution law violations

The Caribbean Princess in Bar Harbor

BAR HARBOR, Jan. 15, 2022 - The parent company of the Caribbean Princes, which is scheduled to visit Bar Harbor seven times this fall, has pleaded guilty again for violating a court-ordered environmental compliance program.

Under the terms of a new plea agreement announced on Tuesday by the Justice Department, Carnival Cruise Lines was ordered to pay an additional $1 million criminal fine and once again required to undertake remedial measures to ensure that the program proceeds.

In 2013, a “whistleblowing engineer” reported to the Coast Guard that Caribbean Princess was using a “magic pipe” to discharge oily waste off the coast of England, resulting in a 2016 conviction on seven felony charges and a $40 million fine, the largest-ever involving deliberate vessel pollution.

Under the new plea deal, an investigative office will report directly to a committee of company directors with authority to initiate investigations independently; Carnival must ensure investigators have sufficient resources; and the company will be restricted in removing personnel who perform internal investigations.

Failure to comply with deadlines will result in fines of $100.000 per day for the first ten days and $500,000 per day after that initial period.

Carnival is a criminal enterprise which has been deliberately violating environmental laws as a matter of normal business operations for decades. And after it was convicted in 2016, it set up schemes to mislead the court monitor during a 5-year probation, resulting in a judge’s order last October for additional compliance.

The QSJ wrote in May that Carnival, whose ships visited Maine 70 times a year before the pandemic, must satisfy U.S. District Court Judge Patricia Seitz’s order in Miami that its vessels comply with environmental laws before they re-enter U.S. waters. The Caribbean Princess visited Bar Harbor seven times in 2019, the last year cruise ships were allowed.

On Aug. 26, 2013, the crew of Caribbean Princess deliberately discharged 4,227 gallons of oil-contaminated waste off the southern coast of England. Carnival was found to have begun the scheme in 2005 with Caribbean Princess and four other ships.

Caribbean Princess was caught when a whistleblower, a newly hired engineer, photographed the illegal setup dubbed “magic pipe.” The engineer reported the discharge to authorities when the ship subsequently berthed at Southampton. He made a video of his photos from which the Justice Department was able to charge the company.

In December 2016, Carnival pleaded guilty to seven felony charges and paid a $40 million penalty, related to discharges off the coasts of Florida, Maine, Massachusetts, New Jersey, New York, Rhode Island, South Carolina, Texas, Virginia, the U.S. Virgin Islands and Puerto Rico.

The whistle blower was awarded $1 million.

In 2019, the company was fined another $20 million for violating its 5-year probation.

The Bar Harbor town council is seeking ways to cap cruises ship tourism because of congestion. But the council rarely discusses pollution, focusing mostly on crowd and economic issues.

At a public hearing in Rockland in 2018, industry consultant Amy Powers said tests conducted by the MDI Biological Laboratory around Frenchman Bay found no contamination. But Dr. Ross Klein, an authority on the cruise ship industry and professor at Memorial University in Newfoundland, countered that the tests examined the water around the cruise ships, not the effluent at the point of discharge, the way the Alaska regulators did.

Klein has compiled a list of all known cruise ship violations dating back to the early 1990s.

Besides discharging of waste into the sea, cruise ships are among the worst air polluters, from burning cheap diesel fuel. About 70 percent of their power need is for propulsion, getting to and from a harbor. The 179 ships which visited Bar Harbor in 2019 easily eclipsed the power use of MDI for an entire year.

In 2017, an analysis by an environmental group found that ships operated by Carnival emitted 10 times more sulphur oxide into the air than all 260 million cars in Europe.

Carnival violated probation when it was determined that the company had been secretly and improperly preparing its ships for audits under the Environmental Compliance Program. In December 2017, evidence was presented of the preaudits, and judge Seitz instructed Carnival to end them. But according to federal prosecutors, Carnival then developed a second such program.

The second program differed from the first in that the preaudits weren't timed immediately before the scheduled court audits, but prosecutors said they effectively subverted the Princess plea agreement.

"The United States views both programs as reflecting a serious failure by the defendant at its senior executive levels to appreciate the fact that Princess is a convicted criminal on probation and that the terms of probation are mandatory and not discretionary," wrote Thomas Watts-FitzGerald, an assistant U.S. attorney in Miami.

"The defendant is a criminal. It is a recidivist criminal," Judge Seitz told Carnival's lawyers in 2018.

Criminals seeking to operate in the waters off Bar Harbor is becoming a thing. American Aquafarms, headed by a founder who served two years in a Norwegian prison for fraud, has applied for a state lease for two 60-acre sites in Frenchman Bay to pen salmon. If approved, Carnival will have company.

A substantial portion of this article came from the Miami Herald.

Tribute: Martin Luther King Jr.

Jan. 15, 1929 - April 4, 1968

The Nobel Peace Prize 1964 was awarded to Martin Luther King Jr. "for his nonviolent struggle for civil rights for the Afro-American population."

Tribute: Kevin Peter Matthei

1952 - 2022

BAR HARBOR - Kevin Peter Matthei, 69, died unexpectedly on Jan. 9 at his home in Bar Harbor, Maine. He was born on November 18, 1952, in Long Branch, NJ, the son of Wesley G. and Marie E. (Kassay) Matthei.

Kevin grew up in Neptune and Warren, New Jersey and graduated from Watchung High School in 1970 before attending Northeastern University and graduating in 1975 with a bachelor’s degree in accounting. Kevin spent many years working for MACOM in Lowell, MA, and was also a handyman for people across Mount Desert Island. A loyal member of the Elks Club and Friends of Acadia, Kevin had a deep passion for the outdoors, nature, and bringing laughter to everyone that he met. When he wasn’t hiking, hunting, fishing, or playing cards you could find him enjoying time with his daughters and grandchildren and making everyone around him laugh (a lot). For many years Kevin would volunteer on the Appalachian Trail, cooking breakfast and taking care of travelers and hikers from all over the world, and he always surprised his daughters and grandchildren with visits, where he would bring presents consisting of books (with hidden dollar bills in every page) and thoughtful gifts that they would enjoy.

Kevin is survived by his mother, Marie Matthei of Bradenton, FL, his brother Keith Matthei and wife Alison Matthei of Sarasota, FL, daughter Lauren Matthei and fiance Mackenzie Oliver of Essex Junction, VT and daughter Victoria (Matthei) Azzolino and her husband Mike Azzolino of Groton, MA, two grandchildren Anthony and Juliana Azzolino of Groton, MA, and many nieces, nephews, cousins, and friends.

The family will be having a private service in Bar Harbor, and planning a celebration of life for Kevin’s family and friends in the Summer of 2022. Condolences may be expressed at www.jordanfernald.com.