LEWISTON – LePage Bakeries has something in the oven that will alter the face of the downtown.

The company plans to build a $725,000 distribution center attached to its Lisbon Street bakery. The 20,000-square-foot center will require closing Birch Street from Lisbon to Park streets. It’ll extend the LePage building’s footprint easterly to 422 Lisbon St. Back-lot work associated with the project will provide parking and open space for lapse on Park, Birch and a corner of Knox streets.

The project is viewed by the city as significant. LePage is one of the top 10 property tax payers here and employs about 100 people locally. Its payroll tops $13 million annually. Another $6 million in payroll is linked to subcontracted transportation and trucking services, according to documents filed in support of the effort.

“I feel this expansion will help ensure the future for the city,” said Greg Mitchell, Lewiston’s development director.

Tax package

Mitchell put together a tax increment financing proposal to assist LePage in financing the expansion. The proposal, worth an estimated $520,347, goes before the City Council at 7 p.m. Tuesday for its study and eventual approval.

The distribution center, with Park Street access, will remove some truck traffic from Lisbon Street, Mitchell said, while enhancing a gateway to the central business district.

LePage also is adding a smaller distribution facility to its Canal Street building. Mitchell said that will help to remove light trucks from Lisbon Street. LePage operates a third facility on the far side of the canal in the mill complex area.

The distribution center nearly exactly matches one aspect of the Downtown Master Plan adopted in 1999. The southern gateway district aspect of the plan calls for parking and a truck terminal on the block bounded by Birch, Maple, Lisbon and Park streets to serve the bakery.

The TIF being offered by the city, Mitchell said, will help offset extraordinarily high development costs associated with downtown construction and reconstruction.

‘Creative solution’

“LePage,” he said, “is limited by surrounding property or roads. Our problem became one of how do you creatively develop a business park in the downtown. With this we’ve come up with a good creative solution.”

Moving, he said, wasn’t an option.

“Without LePage, it wouldn’t be downtown Lewiston,” Mitchell added.

And without the TIF, “we lose it all.”

Nissen bakeries left Portland, Mitchell said, due in part to getting a better offer of municipal assistance elsewhere. “That threat is here,” he said, “and it’s real.”

“This investment is in a company that’s making something in Lewiston that it could just as easily make somewhere else,” he said.

Andy Barowsky, LePage’s president, was traveling out of state Monday and didn’t return a call seeking comment.

TIF details

The municipal assistance being offered to LePage includes closing Birch Street from Lisbon to Park. The $725,000 TIF that calls for the return of 75 percent of property taxes on the center – estimated at $150,347 – to be returned over the 10-year term of the agreement. Other help includes $223,000 to demolish 10 tenement buildings to make way for the center, parking and green space. Another $17,000 is listed as the cash value difference for five land parcels the city owns that LePage is buying, and $130,000 for Park Street reconstruction to facilitate access to LePage’s loading docks.

Even with the TIF, the project will generate more than $5,000 in property taxes annually. The TIF agreement allows taxes as well as the value of property improvements to be captured by the city for aid purposes. With the TIF, the city won’t be docked state aid to education funds or state profit sharing money, and the county’s tax assessment won’t include the increase in overall value.

Tax revenue generated by the TIF property will go into the city’s general fund, which pays for ordinary municipal expenses.

LePage and its offshoots own parcels valued collectively at more than $12 million, putting it on a par with Geiger as the city’s fifth or sixth largest taxpayer.

Mitchell said only one of the affected tenements is occupied. Demolition of the tenement buildings also falls within master plan terms as the city continues to remove older housing stock to avoid blight, he added.

Besides the council, the Planning Board also must approve the project, Mitchell said.