In an attempt to resolve a legal dispute with Haigis Parkway landowners, the town of Scarborough has admitted to making mistakes in the way property was originally assessed.

The Town Council voted last week to schedule a public hearing on changing land assessments along the Haigis parkway. The hearing will take place 7 p.m. July 19 at town hall.

For most property owners the changing assessment means paying less to the town for utility improvements – water, sewer, electricity and gas – intended to attract high-end businesses to the Parkway.

Originally in May of 2004, the town required all Haigis Parkway landowners to pay half of the $10 million in infrastructure improvements. At that time, each owner’s payments were based on the amount of acreage and how much of that land actually fronted the Parkway.

Linwood Higgins, who owns property under Three Diamond Realty, disagreed with his $1.4 million assessment. Though the council considered the land more valuable once utilities were added, Higgins brought suit against the town. Soon after, the company that owns Scarborough Downs, Davric Maine Corp., followed, disputing its $750,000 assessment. In August the two suits were combined.

According to Town Manager Ron Owens, both groups have agreed to the changes proposed last Wednesday night. To officially settle the suit the council will hold a public hearing on July 19 and will then vote to approve the new assessments later this summer.

Higgins, Davric and a majority of the other 24 property owners will all have lower assessments. Higgins is now assessed at $785,000 and Davric’s was lowered to $425,000.

According to Owens, these adjustments were necessary after they discovered mistakes were made in the original assessment.

Specifically, he said the town did not consider that $1 million of the sewer improvements actually serve areas outside of the Haigis Parkway. According to Owens, the sewer system was designed to be bigger than necessary for just the Parkway. As a result, all 24 property owners will now pay 40 percent of the improvement costs instead of half.

“That seemed to be an easier way to adjust for that $1 million,” said Owens.

Owens did not give an exact amount the town will have to pay to make up for the extra utilities costs. He did say that he expects that the added value to some assessments and taxes from future development along the parkway will help meet the costs.

He also said beyond the extra money needed for the sewer, the town’s original land value assessments were not correct. Engineers did not originally take into account some of the more valuable frontage in certain lots. Though a majority of the 24 property owners will see lower assessments, a few will increase now that all frontage has been taken into account.

Ellen Fontaine, manager of 262 Payne Road LLC, is one of the few facing a bigger number. Her assessment went from $59,000 to $113,000.

Fontaine said that while she realized the amount could change when she bought the land, she feels that this is excessive.

“I cannot accept that, ‘we, oops, made a mistake and now we’re going to charge another $50,000,'” she said. Fontaine has already made her first payment to the town for the improvements, but now that she is selling the land she’s worried the buyers will change their minds after seeing the increase.

“We’ve put everyone on the same formula,” said Owens. “This is not done property owner by property owner.” He added that if they were to adjust just one owner’s land value they would create more legal problems with the others.

“It’s very important that we settle this and move on,” said councilor Sylvia Most. The Haigis Parkway “is a spectacular opportunity for the town.”

Councilor Jeffrey Messer said he believes this assessment treats everyone fairly, adding that, “if everyone’s just mad a little bit, I guess we’re OK.”

According to Owens, by the end of summer the Haigis Parkway suit should be behind them. After the public hearing in July the new assessments are expected to pass in early August.