Town councilors on Tuesday night voted to scrap discussions with Midcoast Regional Redevelopment Authority, regarding two proposed tax increment financing districts which would have overlaid the former naval air station.

Their problem is not with MRRA. Rather, they are wary of potential changes at the state level that could nullify any revenue advantages the districts would provide.

In the worst-case, the town even could be left with an inflated property valuation it cannot recoup through taxes on future development.

“Brunswick schools need every dollar we can afford,” said District 2 councilor Ben Tucker in his motion to terminate the tax increment financing, or TIF, discussions. “The TIF districts and development program under discussion would prohibit use of the town’s share of TIF proceeds for the schools. It would also restrict the town’s use of the proceeds.”

TIF districts are land use programs approved at the state level by the Department of Economic and Community Development and administered by local government. They allow a new or expanded business entity to keep a percentage of local property taxes generated for reinvestment back into the business. In exchange, the business repays the sheltered value to the municipality over time, usually to a series of benefactors — schools, municipal “rainy day” funds, capital improvements, etc. — as spelled out in the TIF agreement.

Additionally, the new commercial entity would be sheltered from county taxes and does not handicap the town with regard to the amount of state education funding it receives.

Two such districts had been slated to overlay the former Brunswick Naval Air Station, which is too large to fit into one TIF district. One, Brunswick Executive Airport, would encompass the airfield while the other, Brunswick Landing, would have enveloped the rest.

MRRA and the town would have divided the recaptured tax revenues — estimated by MRRA Executive Director Steve Levesque to be as much as $40 million over the life of the TIF — although the percentages had not yet been worked out.

Boosted school funding was one of the primary reasons for the zones.

“We’ve been very consistent in terms of our proposed use of the (TIF-generated) funds,” said town manager Gary Brown. “Initial conversations with DECD personnel indicated that what we were proposing would be supported.”

Recently, however, state officials have backed away from that certainty. Brown said Gov. Paul LePage’s administration has refused to provide the town any indication that its TIF proposals would be accepted or rejected. Instead, the town would have to go through the effort and expense of preparing a proposal and then wait to hear the DECD’s verdict.

That’s time and money the town can better spend on something else, Brown said.

“It certainly appears as though the (LePage) administration is intent on making some radical changes and until we know what those changes are, we’re better off taking a time-out right now,” Brown said.

Worse yet, there is the possibility that if the town agrees to a TIF agreement with MRRA, the state Legislature could then rewrite the TIF laws that would leave Brunswick with the full expense of hosting development but reaping as little as 20 percent of the projected sheltered revenue.

“Until recently, I felt that balance with these restrictions would benefit the town,” Tucker said. “However, I am no longer confident that we will have the cooperation and support from the governor’s administration or the Legislature that we need for the flexible use of TIF proceeds in order to benefit the town.”

Tucker’s motion passed by a vote of 8-1.

At-large councilor Benet Pols voted to oppose the motion because he had missed discussion during the executive session prior to the meeting, he said, not because he disagreed with his colleagues.

When told of the board’s decision, Levesque, MRRA’s executive director, said he was disappointed but hopeful talks would resume.

“We’ve been talking about (TIFs) for a couple of years,” Levesque said. “I’m not sure what the implications are yet, but we’ll work through it.”

Attempts to contact the DECD were not returned by press time.

In other business

Also Tuesday, councilors authorized town clerk and assistant to the town manager Fran Smith to act as liasion during negotiations with Brunswick Development Corporation. A zoning wrinkle has to be smoothed over before the town can exchange the current municipal building at 28 Federal St. for the site of the future police station at the corner of Stanwood and Pleasant streets.

Current zoning allows the building to be used as commercial office space only as long as the town owns it. In order for it to continue to be used as office space — as the BDC intends — either the zoning must be changed or the town must retain ownership.

The town had an appraisal of the property done, Brown said. Without a zoning change, its value is $60,000. With a change, however, the value jumps to $360,000.

Changing the zoning also preserves the building as it is, Brown said. If the zoning is not changed, the building likely would have to be demolished and a new structure built in its place to fit a residential only use.

For the exchange to go through, the entire block between Mason and Dunlap streets would have to be rezoned.

The Planning Board is scheduled to discuss the impending negotiations and zoning during its Sept. 11 meeting.

Councilors also approved two two food-related items.

Brunswick Downtown Association received permission to hold its annual Taste of Brunswick event on the mall on Sept. 15, from 11 a.m. to 3 p.m., complete with a temporary license to serve alcohol.

Additionally, Mid Coast Hunger Prevention Program received a special permit to allow sidewalk troubadours to raise money for the agency later this month. Scheduled for Sept. 29, the first annual “Singing for their Supper” will be a joint event between WCLZ 98.9-FM and the Union Street-based hunger awareness group, said Karen Parker, MCHPP’s executive director.

“It’s like an art walk except with local musicians who will be singing on the sidewalks outside local businesses,” Parker said. “They’ll have their instrument cases open and will be taking any donations to help (MCHPP).”

Councilors agreed to waive the usual $500 permit fee.

Also Tuesday, the council voted to allow the police department to keep $475 in cash, seized during a cocaine trafficking bust on Feb. 15, 2011. Town police assisted state Drug Enforcement Agency officers when they arrested a Lewiston man, Grable Thomas, who had the drugs and cash in his pockets.

It wasn’t exactly “Miami Vice,” said Deputy Chief Marc Hagan. In fact, it’s barely enough to keep fuel in a couple of patrol cars for a week. But the money will be used for the department’s drug enforcement and prevention needs.

jtleonard@timesrecord.com