2008 Oh, what a ride! The year in review | There were thrills (650 new call center jobs), chills ($4-a-gallon gas) and spills (Red Shield-a-go-go) aplenty in 2008. Buckle up as the staff of Mainebiz takes you on a dizzy ride through the year that was. Scr

The end of 2007 felt like riding in an ominously creaking rollercoaster car up a steep incline. Gravity pressed our backs to our seats, our minds raced at the ever-widening distance between us and the solid ground of cheery-old 2006, and all we could hear was the rhythmic click-clack, click-clack of worrisome news — subprime foreclosures, Wall Street banks tottering, Maine’s $20 million Mainsail II investment tanking. We hit the summit last Jan. 1, enjoyed for one surreal second a view of the horizon made beautiful by all of its unknowns, and then went plunging 100 miles per hour into the reality of 2008.

This year was the kind of ride that could give you whiplash, or at least make you swear to your friends that something got knocked out of whack somewhere important and so you couldn’t ever ride again for health reasons. No, you’re not scared. Doctor’s orders.

In the world of thrill rides, there are kiddie coasters, old-fashioned granny coasters, decent drop coasters, and then big-Daddy-hold-onto-your-seat-is-this-belt-fastened-tight-because-my-life-depends-on-it topsy-turvy triple-loop monsters. 2008 was sort of like that last one. We’re all feeling a little woozy.

If you’re spooked by rapid ups and downs, you may want to try the Tea Cups. They’re not a real ride and everyone will make fun of you, but go for it. Our grandmother’s holding a place in line.

Are all the rest of you ready to take the plunge?

Wall Street stumbles because of bad subprime debts; foreclosures rise in Maine and around the country; endowments suffer at some of the country’s wealthiest universities, including Colby College in Waterville; Maine’s projected budget shortfall hits $838 million; and the governor calls for 10% reductions in all state agency expenditures.

Whew. This ride is intense. Our heads are spinning, how much more can we — wait. Hold on. We’re climbing again. NotifyMD, Barclaycard, Athenahealth and Boston Financial open high-end call centers in Maine, employing hundreds. The stock market is rebounding. Gas prices are down. Eastern Manufacturing in Brewer is reborn. People are conserving. A new president is coming in January, and his message of hope is giving consumers, well, at least a little bit of hope. Hey — we can see our houses from here! And we’re able to refinance them!

We’re at another summit. Wow. Will you just look at this view? There’s the exit, way down there in 2010.

Everyone’s getting off the rollercoaster and they seem so happy. They’re spending money again on discretionary items like blue raspberry snow cones and those weird flash-frozen ice cream pellets. You know, this ride isn’t so bad. It kind of reminds us of the Tea Cups, it’s almost like —

Whoa! We’re dropping! The Big Three want a bailout! They say three million jobs are at stake! There’s talk about this recession turning into a depression! Credit crunch! Layoffs! The Maine Department of Labor overwhelmed by unemployment calls!

Gosh, this ride could go on for awhile. It’s pretty exciting, sure. We mean, you know, we’re not freaked out or anything. It’s just that we think we knocked something out of whack in that last stock market slump and, doctor’s orders, we probably really shouldn’t ride this thing again.

So, after we get off, we’ll meet you at the Tea Cups.

The merry-go-round

Got a little déjà vu? That’s because these stories went round and round in 2008.

BNAS, no longer flying the friendly skies

The first of its five squadrons left for good in December, marking the beginning of the air station’s shutdown. Soon, 600 housing units are expected to hit the market. But for lots of people in the Midcoast area, the 2011 closure of BNAS is still evolving. A redevelopment group is flying some test balloons for its reuse, while real estate professionals are girding for a glut in the local housing market.

Feeling lucky?

Dual efforts to bring more gambling to Maine were shot down in November. Scarborough Downs lost its bid for slot machines, while backers failed to convince voters that an Oxford County casino was a good idea. In 2007, gambling proponents lost a referendum question to bring a racino to Washington County. In 2003, there were two citizen initiatives connected to gambling; one brought slots to Bangor, the other denied a casino to the Passamaquoddy Tribe. Think casino proponents have played their last hand? We wouldn’t bet on it.

Little consolation for consolidation

Gov. John Baldacci decreed in 2007 that Maine’s 290 school systems should consolidate to 80, or risk losing state funding. He also said municipalities should consider the same. Much belly-aching ensued. This year, a revised law scaled back school consolidation and then the state cut funds for municipal consolidation in April due to budget shortfalls. As of early December, only 15 school consolidation plans have been approved, and 34 alternate arrangements are under way. And even the model of collaboration — Lewiston-Auburn — couldn’t agree to merge any municipal departments.

Plum Creek plods along

It’s been four years since Plum Creek, the Seattle-based land development company, first announced plans to bring housing and mixed-use projects to Moosehead Lake. In October, Plum Creek accepted the revisions suggested by Maine’s Land Use Regulation Commission and is now pursuing its resort plan for 975 house lots and development on Lily Bay. As part of the LURC concession plan, the company intends to conserve more than 400,000 acres of forest in the Moosehead Lake area. LURC is expected to make its final decision on the proposal by early 2009.

Resuscitation for Dirigo?

Voters said no to a new beverage tax in November that would have helped fund Dirigo, the state’s chronically cash-strapped, subsidized health insurance program. So Gov. John Baldacci hopes a Democratic D.C. will finally grant the state a waiver for Medicaid match funding to help pay for Dirigo, dollars he says other states have been granted and that would stabilize the program and allow it to grow. That follows a Kennebec County Superior Court filing in October by the Maine State Chamber of Commerce to repeal funding for Dirigo, challenging the $48.7 million savings offset payment levied on insurers and health care providers to support it. The lawsuit is similar to one that failed in May 2007.

Lights out for ISO-NE?

A controversial proposal to take Maine out of the ISO-New England power grid is being mulled by the Public Utilities Commission, which must weigh whether citizens would be better served by another energy alliance or Maine striking out on its own. A PUC report noted that less populated states like Maine shoulder the energy costs of more populated states, and that the region cedes control to the federal government over policies like the wholesale price of electricity, which since 1990 has risen faster in Maine and New England than nationally. Also weighing in is Central Maine Power, which plans a $1.4 billion transmission upgrade, of which ISO-NE members would pay the lion’s share. The Federal Energy Regulatory Commission gave the green light to CMP’s transmission project in October.

Still no port in the LNG storm

Oklahoma-based Quoddy Bay LNG is the most recent company to abandon plans for a liquefied natural gas terminal in Maine, withdrawing its application for state approval in October. But two other LNG proposals are still active — Calais LNG and Downeast LNG, though Downeast LNG, while it has a permit pending before FERC, withdrew its application with the state last year. Calais LNG first proposed its project in 2005.

The Zipper

Whoa, these stories really picked up speed

Feeling the heat

Energy continued to serve as fuel for thought for Mainers in 2008. Skyrocketing gas prices pinched us at the pump, only to plunge in recent weeks to the lowest levels since 2004. Meanwhile, businesses worked on a bevy of alternative power proposals, doing their best to ride out the shifting currents of public and regulatory approval. Peregrine Technologies of Harpswell managed to arrange financing for a $50 million biomass boiler in Millinocket, only to ditch the project when ISO-New England in June announced the power grid was maxed out. The failed $180 million Redington Mountain wind farm project may get its own second wind if its developer can persuade the town of Carrabassett Valley to annex the land. Riverbank Power Corp. of Toronto wants to construct a $2 billion hydroelectric facility in Wiscasset on property residents last November decided wouldn’t house a coal gasification power plant.

Other developers eyed the sea, the sun and the forest, with Boston-based Blue H USA considering a 90-turbine floating wind farm in the Gulf of Maine, and Ascendant Energy of Rockland installing dozens of solar equipment systems across the state. In Bethel, entrepreneur Les Otten in May launched wood-pellet business Maine Energy Systems. Looks like developers still have plenty of energy for 2009.

A business beacon

The Cianbro Eastern Manufacturing Facility in Brewer transformed an old paper mill into a modern manufacturing facility to make modules for oil refineries this summer. Six hundred jobs gushed forth. Now the construction giant proposes a training center in Pittsfield to consolidate its training operations currently conducted in three states. Talk about building a foundation for success.

Full-court press

Maine’s media made the news as much as they reported it this year, with buyout deals and mergers regularly making headlines. An investment group plans to wrap up by 2009 its purchase of the troubled Blethen Maine Newspapers, owner of the Portland Press Herald/Maine Sunday Telegram. Rockland-based VillageSoup in June snapped up all of Courier Publication’s papers in the Midcoast, and Sample News Group of Pennsylvania, publisher of the Journal Tribune in Biddeford, in February scooped up The Times Record of Brunswick. Broadcasters got in on the game too; Kennebunkport’s Blueberry Broadcasting in May bought all 17 of Clear Channel Communications’ radio stations in Maine. Stop the presses, all this changing of hands is making our heads spin.

Notes on a scandal

The John Duncan embezzlement scandal at Verrill Dana, one of the state’s oldest and largest law firms, came to light in 2007, but 2008 laid the dirty deeds bare. Retribution for Duncan’s theft of nearly half a million dollars from his clients and the Portland firm continues to dog the closeknit Maine legal community, and the once-respected attorney now sits in a Brooklyn jail for tax evasion and theft while his colleagues at the firm undergo an outside review of their handling of the matter. While questions still linger about what motivated Duncan’s bizarre conduct, Maine lawyers continue to brace for more fallout from this unprecedented disappointment.

Local motive

If a train travels north out of Boston at 60 mph, and a transportation loan leaves Washington at the same time at 5 mph, will the two ever meet in Brunswick? That’s more than a mathematical mindbender for many counting on the extension of Amtrak’s Downeaster service to the Midcoast. Officials in Brunswick are moving full steam ahead with plans for their $27 million version of Grand Central Terminal, even as the delay of a $35 federal loan threatens the project. Let’s hope all those grand plans don’t jump the track.

The house of horrors

Welcome, brave boils and ghouls, to 2008’s creepy tour of the year’s worst business mishaps

Breach beast

There, in the shadows, it’s the Hannaford data breach, born in December 2007, lashing out in 2008. Oh, the breach was a formidable foe this year, pouncing on Hannaford stores from Maine to Florida and threatening 4.2 million customer credit cards. Eventually the breach was contained and conquered in March, but lo — two undead class-action lawsuits still circle the breach, calling for its blood.

Ship shock

Here at the gypsy’s room, we receive a tarot card. It is a cruise ship — rejoice! This bodes well, the cruise industry showers riches upon our good state. But, wait. The gypsy shakes her head, she shrugs her shoulders. She gives us a new card. It is of a dinghy! An industry trade group ranks Maine 41st for cruise ship revenue — a relative pittance. A University of Maine economist challenges the association’s $24 million figure, but his own report on the industry won’t be out until 2009. Horror!

Haunted roads

On we trudge, over rough terrain that earned our state a C- average in an infrastructure assessment in December. This, after spending millions on bonds to make getting from here to there easier. Gov. John Baldacci in December pledged to propose more infrastructure bonds to shore up Maine, on top of the $240 million voters already approved.

Red Shield freezes

Fuel prices weakened the once-promising Red Shield Environmental pulp mill this year and set the company on the road to Chapter 11 bankruptcy. Bought out of bankruptcy in September by New York private equity firm Patriarch Partners, the 180 employees the company had promised to rehire were told in December that another downturn-related problem — drastic drops in the pulp market — will halt rehire plans for now, making 2008’s Red Shield story a chilling one, indeed.

Precarious pier

And now we stand on one of the most tragic business mishaps of the year, the Maine State Pier, where development was stalled one year after the developer was chosen. But maybe we can already spy light at the end of this tunnel. Portland’s talks with Portsmouth developer Ocean Properties are just beginning, but perhaps the $100 million development will soon come back from the dead. Still, we can see the pier’s submerged lands gurgling, “Who owns us?” they whisper, “State or city?” Perhaps in 2009 those submerged lands will find peace.

Union woes

Finally, let us pass through the fog of the union troubles at Bath Iron Works, where leaders of the International Association of Machinists and Aerospace Workers Local S6 faced a year thick with accusations of mismanagement, poor accounting and pornography-viewing on work computers. The head office of the IAMAW displaced local officers in March pending resolution of the allegations, and in September roughly half of the 1,677 members of Local S6 filed a petition in support of local leaders and calling for an end to the trusteeship. As we head into 2009, the trusteeship remains in effect and the investigation of Local S6’s former officers continues.

Exit this way

Whew. These stories are finally winding down.

Busy signal

On March 31, FairPoint Communications finalized its deal to take over Verizon’s wireless and Internet services in northern New England for $2.3 billion. The Charlotte, N.C.-based company received approval for the takeover from the Maine Public Utilities Commission in February, as well as from regulators in Vermont and New Hampshire and the Federal Communications Commission. Still, this epilogue continues. Problems with the switch from Verizon to FairPoint led to interruptions in the state’s 911 service and prompted the company to delay its complete takeover until January 2009.

On thin ice no more

After years of trying to revive the Androscoggin Bank Colisee and nearly a year on the market, the city of Lewiston finally sold the civic center to Firland Management, an ice rink management firm based in Veazie. Councilors approved selling the property for $1 million in June, giving Firland until April 2009 to buy the facility. Until then, the firm is operating the Colisee and paying all expenses. MAINEiacs fans hold up their foam fingers and rejoice.

Transmission over

Months of review by regulators in Maine, Connecticut, Massachusetts and New York finally allowed Spain-based utility company Iberdrola SA to complete its acquisition of New Gloucester-based Energy East for $4.6 billion on Sept. 16. Iberdrola announced its intention to buy Energy East, parent company of Central Maine Power Co. and other Northeast power companies, in June 2007, and received approval from Maine Public Utilities Commission in January 2008. Now electricity users want to know: Hay un discuento?

Playing it close to the vest

Three years after opening its temporary facility, Wyomissing, Penn.-based Penn National Gaming Inc. opened the permanent Hollywood Slots Hotel and Raceway on July 1. The $132 million facility, the state’s only casino, now boasts a 152-room hotel, a four-level parking garage and 1,000 slot machines. On its first day, the racino brought in roughly double the revenue it had generated at its interim facility, but operators wouldn’t reveal their hand — exact revenue figures were not released.

As we head into 2009, the staff of Mainebiz wishes you a happy and prosperous new year. And a much smoother ride.