On the rebound | Sanford pulled out all the stops to avoid losing rug manufacturer Flemish Master Weavers

Nearly five years ago, Sanford lost what could have been a glittering six-story miniature Las Vegas — a $650 million casino complex with an 875-bed hotel, gambling halls, a convention center, performance theater, shops, restaurants and an 18-hole golf course that supporters said could have raked in more than $700 million a year.

But the casino, which was pitched by the Penobscot Nation and Passamaquoddy Tribe in Maine, became a contentious issue in the run-up to the 2003 referendum vote, driving wedges between locals who saw the casino as Sanford’s savior and those who warned that gambling could bring a rash of other problems, from gambling addiction to crime.

Ultimately, when the casino question was placed on the Nov. 4, 2003, referendum, 66% of Mainers — and 63% of voters in Sanford — said “no” to gambling in southern Maine, simultaneously dashing the hopes of the tribes and those residents who believed that turning Sanford into a gambling mecca would end their hardship.

Losing the casino, though, didn’t send the town into paroxysms of self-pity, according to many people in town. Instead, it helped build momentum for a pro-business movement that had already begun to well up in Sanford. “The casino really forced people to look at the future and say, ‘What do we have here, and are we going to lose something if we say yes to the casino?’” says Lee Burnett, a 23-year resident of Springvale, a village within Sanford. Burnett is Sanford’s part-time grant writer, one of several new economic development positions the town created after the casino referendum failed. “It was a big debate; it forced people to look at the whole town,” he says. “And I think unavoidably, once they said ‘no,’ they said, ‘Well what are we saying ‘yes’ to?’”

Bradford Littlefield, a town councilor who supported the casino, says the issue woke up citizens. “What came out of the casino vote was a change in attitude in Sanford,” he says.

Yet, however much Sanford accomplishes, change will come at slower pace and certainly be less glitzy than any growth and wealth wrought by a casino. And despite all the hustle — and the concrete achievements already underway — the town still has a high unemployment rate to lower, 7.25% on average this year, and other obstacles to hurdle.

“Like with the mills, there’s been a lot of talk, a lot of activity [around developing them], but if you look at them, they look the same as they did five years ago,” Burnett says. “Things are happening but they don’t happen overnight.”

But for some at least, slow change is a relief — and is preferable to fast change that comes with, well, fast change loaded nickel by nickel into slot machines.

“It’s evolution,” says Evan McDougal, the manager of Sanford Regional Airport, about the developments around the town. “It’s much better in my opinion to try to think of the outcome and the possibilities rather than getting things going all at once and realizing 10 years later we made a significant error. Planning is important.”

Laying a foundation

In 2004, Les Stevens stepped on board as Sanford’s first ever economic development director. Stevens has worked throughout Maine in a number of economic development positions, from CEO of the Finance Authority of Maine and director of the Maine State Development Office in Gov. Joseph Brennan’s administration in the 1980s to development positions in the Bangor region, Lewiston-Auburn and Brewer. The new council also hired a town manager, Mark Green.

“Sanford went through some soul-searching after the vote on gambling in Maine,” Stevens says, when residents had to confront the loss of what could have been “the magic band, the silver bullet, the panacea, the elixir that would solve the economic doldrums since the 1950s when the Goodall mills shut down. I think, in a sense, the casino crystallized some fairly strong feelings in the community about the importance of economic development.”

Stevens has outlined a detailed plan of action for Sanford, which includes setting up several development committees, clarifying a philosophy of working collaboratively with state and federal agencies, and adhering to a specific thrust of development in strategic parts of town. “Economic development is [the] number-one public policy priority,” he emphasizes.

Stevens says he believes the town already is naturally poised for growth: It sits between the expanding metropolises of Portland and Boston, and yet the town, being somewhat inland, still offers affordable real estate. Moreover, Sanford lies within a large population center located in a county that’s grown by 80% since 1970, compared to 33% growth for the whole of Maine. And Stevens says Sanford’s population is projected to become Maine’s fourth largest within the next 10 years behind Portland, Lewiston and Bangor. Lots of people mean a deep pool of workers, which should pique the interest of scouting companies, he figures.

These demographic statistics also draw big-box stores. And a Wal-Mart Super Center and Lowe’s already have broken ground on undeveloped land by the airport on Route 109. Stevens predicts that the arrival of these big box stores will bring other retail stores, and those retailers will be trailed by smaller boutique stores in the downtown. The sprouting downtown will in turn galvanize the growth of professional services, like accounting, law, engineering and marketing firms, he concludes.

Town officials also hope those big-box stores will lure other retailers to town. And Sanford officials expect to blanket the retail area in south Sanford, at the town’s outskirts, with a special tax-increment financing district that would funnel retail tax dollars back to the town for improvements. (The TIF provision was adopted by the state Legislature in 2001 to help out beleaguered downtowns.) “In a time when many other towns in the state of Maine are saying no to Wal-Mart, Sanford has aggressively run out to these retail centers to grow its economy,” Littlefield points out.

James Nimon, the director of the Office of Business Development with Maine’s Department of Economic and Community Development, says so far only Augusta and Sanford have taken advantage of this TIF provision. “They are leaders in looking at how to use growth in retail outside of town to enhance development downtown,” he says.

Sanford also has laid a TIF district over the downtown area to capture tax dollars from future development for more capital improvements, and over the mill area, which has 1.5 million sq. ft. of usable space. This summer, the town plans to build a new access road to the mill, which is made up of six large, brick buildings that straddle the Mousam River, as well as begin a clean-up of the brownfields around the former factory. “We’re priming the pump,” Stevens says, with the hopes of attracting redevelopers in the not-so-distant future.

Growing businesses

Although Sanford has done its best to charm new businesses, or convince Maine companies to expand here, it has not always succeeded. No matter how much a community might work to cajole companies to move to or expand in Maine, it’s a tough sell.

Sanford came very close to attracting a large L.L.Bean call center about three years ago, but lost out to Bangor, Stevens says. And last year, Sanford went all out to welcome Oxford Aviation, a plane refurbishing company based in Oxford that wanted to expand at the Sanford airport, by promising to match an almost $1.2 million federal grant for site work, applying for a $670,000 bond and offering to return a hefty portion of the company’s property taxes. In return, Oxford Aviation promised to hire more than 200 employees and Gov. John Baldacci presided over the groundbreaking. But the project has stalled as the company struggles to find private investors, according to town officials. (Calls to Oxford Aviation were not returned by press time.)

Yet the town also has had a string of successes. Recently, Flemish Master Weavers, a rug manufacturer, revealed its expansion plans, which include spending millions of dollars on new looms and increasing the square footage of the plant. (For more on this, see “Spinning a yarn,” page 22.) Rubb Building Systems, which makes prefabricated structures for airplane hangars or warehouses, also is building a larger facility to make bigger buildings, and expects the expansion to lead to 18 more employees. The town assisted Rubb with a $250,000 Community Development Block Grant, a 15-year tax-increment financing arrangement and help becoming a Pine Tree Zone business, a state program that offers tax breaks to expanding companies.

Meanwhile, Sanford Institute for Savings, a bank with $445 million in assets, is doubling the size of its headquarters on Main Street after being convinced to stay in town with incentives like a 15-year company TIF, help with securing a Pine Tree Zone designation and a gift from the town of land for a parking lot.

“It was a choice,” Mark Mickeriz, the bank’s president, says. “We explored a number of options, and the downtown location was not the most cost effective,” adding 5% to 10% to the roughly $4.5 million price tag. “But we do believe in Sanford and want to make sure the downtown remains the economic hub of the region.”

As Sanford methodically puts the pieces in place to grow its economy, it also is indulging in at least one big dream. Right now, as communities around Maine vie for scarce public dollars to fix up roads, Sanford is trying to convince the state to spend millions to build a seven-mile spur from I-95 to Sanford. More than any other economic development project, Stevens says this road could be a harbinger of good things to come in Sanford. “In my view, if there is any one project that would change our economy, it would be a limited access road,” he says. “It would be a huge advantage to our economy.”

Littlefield says the spur demonstrates the steadfastness with which Sanford is pursuing projects that were just pipe dreams a few years ago. “These are things we never would have thought of a few short years ago,” he says. “Because people didn’t think they would have had a chance.”

Flemish Master Weavers has been making rugs in Sanford for 20 years, originally as a subsidiary of a Belgian company, Beaulieue. Five years ago, it was bought by Rhode Island-based Natco Products Corp., and in the last few years its growth has exploded, according to President Johan Moulin. It makes a variety of machine-made polypropylene rugs for its parent company, which in turn sells the carpets to retailers like Bob’s Discount Furniture, Home Depot, Lowe’s and JCPenney.

But the company has seen sales jump by 70% since 2005, and a year or so ago began discussing expansion plans. That got Moulin thinking about whether the firm should stay in Sanford. “Sanford, and Maine, is a disadvantage for us,” he admits. “We ship to all U.S. wholesalers and retailers, and Maine is not a good location. We’re completely out of the center.”

But Sanford wasn’t ready to see Flemish Master Weavers skip town. “You always want to keep your manufacturing jobs,” says Les Stevens, Sanford’s economic development director. “They pay well and bring wealth into the community.”

So Sanford assembled a package of incentives, including a tax-increment financing deal and help landing Pine Tree Zone designation for the company. Town officials also are working to secure Flemish Master Weavers a $250,000 Community Development Block Grant to build a new access road. Moulin says these incentives convinced the company to remain rooted here despite the drawbacks.

Flemish Master Weavers will invest in a $2.1 million expansion to add 60,000 sq. ft. to its 89,000-square-foot facility in Sanford’s airport industrial park. The company also plans to purchase roughly $7 million in equipment, including two looms that cost $1.6 million apiece. The expansion will allow Flemish Master Weavers to add 45 workers to its 65-person staff over the next 10 years, according to Moulin. “The town made an extra effort to keep us around,” he says.