Reduced Fine Imposed On Sparks Avenue Developers By Select Board On Split Vote

The Select Board on Wednesday voted to impose a $62,674 fine on a mixed-use development on Sparks Avenue, dubbed by its proponents as Nantucket’s “New Downtown,” for failing to obtain required construction permits. The initial fine was $125,528, but the Select Board opted to waive half of it following an appeal by the developers.

“Split the difference,” Select Board member Matt Fee said. “I think that’s substantial…I think it was an honest mistake.”

According to Nantucket building commissioner Paul Murphy, the fine was levied on development company Poseidon Development after it began erecting steel framing even though it had only obtained a foundation permit.

“This is never easy,” Murphy said. “It’s a fee that I have consistently, fairly, and impartially had to enforce since the day I got here. The fees are set by the Select Board. I had no choice but to assess the fee. It came to my attention that steel was going up.”

Project manager Kelly Weigold said that the violation was the result of a misunderstanding. Poseidon Development's leadership believed it had submitted the application digitally on August 28th. The town said that they did not receive a required hard copy until September 10th. That two-week lag accounted for the bulk of the disagreement between the town and the developers. A further misunderstanding about Historic District Commission information then cost Poseidon Development a few more days.

“We were between a rock and a hard place there,” Weigold said. “We messed up.”

Weigold is not an attorney for the project, as the Current initially incorrectly reported earlier this week.

The vote to impose the fine was 3-2. Select Board vice chair Brooke Mohr and members Jill Vieth and Matt Fee voted yes, while Select Board chair Dawn Hill and member Bob DeCosta voted no. Hill and DeCosta suggested that they would have preferred to assess the full fine against the developers.

“I know what this is,” DeCosta said. “He looked at how much it was going to cost him if he delayed the steel, and he looked at how much the permit fee was going to be, and he begged for forgiveness, and we gave it to him.”

Some of the Select Board members who voted in the majority expressed some uncertainty.

“Had a question been asked differently at any point in time along the way, this would have gone very differently,” Mohr said. “There were opportunities for communication that could have been better across the board.”

Hill repeatedly pressed Poseidon Development’s representatives on their process, asking why they did not inform Murphy the day they began construction work that they would have to start erecting the steel framing if they did not receive the permit they needed.

“Someone said ‘go ahead and install the steel’ without going to Paul [Murphy] and saying ‘we have a problem,’” Hill said. “You didn’t ask that day and say ‘we have a problem,’ and now you’re asking for, essentially, for forgiveness after the fact.”

Chris Fiumara, a co-founder of the Boston-based commercial real estate lender Crowd Lending and an owner and primary spokesperson for the project, suggested that the nature of the steel companies the developers were working with left them with no choice but to begin construction.

“These steel companies are very fickle. They have their big schedule; they’re union companies. If we missed this window, it would have put the project back two months, which would have screwed this entire schedule up,” Fiumara said. “They’re a different breed of people, and there’s not a lot of leeway to deal with these guys.”

Fiumara also said that “I’m way over budget as it is,” and that “it’s unfortunate, but things happen.”

The original permit cost $31,382. The fine was set by Murphy at four times that amount, but the Select Board ultimately waived half of it.

The developers emphasized that the project will include eight units of affordable housing. Additionally, all 32 housing units will be restricted to year-round occupancy. The town is supporting the creation of those affordable units through $3.7 million in funding for the development allocated by the Affordable Housing Trust in January.

But the affordable apartments and the town's investment in them weren’t the reason every Select Board member gave for waiving half of the fine.

“You were building at your own risk, and I’m just really surprised that you would do that,” Vieth said. “I think I’m going to go along with what Brooke [Mohr] said. I’m willing to reduce the fee, but I also want to make a point that I’m not doing that because we have an agreement with you for affordable housing. That’s not why I’m doing it. I can appreciate that you said that, but I actually think that makes us look worse to do that for that reason. This is just a really costly fee. This is the first time I’ve addressed this issue by being on this board, so I hope that we would look at these fees going forward.”

In addition to the new apartments, the development plans include a restaurant and an eight-lane bowling alley.