The former medical building at 22 Pleasant St. in Mechanic Falls is back on the market after a sale fell through, Town Manager Vic Hodgkins told the Town Council on Monday. The town purchased it in 2017, planning to move town offices there, but an engineer said in 2018 that it was too small. Sun Journal 2017 file photo

MECHANIC FALLS — Town Manager Vic Hodgkins announced at Monday night’s Town Council meeting that the sale of the former medical building at 22 Pleasant St. fell through and “the town is back to square one.”

A purchase and sale agreement with Pythia of Portland had been reached in June for $450,000.

A quick service restaurant was said to be the new tenant.

Hodgkins did not say why Pythia pulled out of the deal.

The building had been on the market since 2019. In November 2017, residents voted to buy it for $275,000 as part of a $500,000 bond. The plan was to renovate it for municipal offices, the public library and Police Department and pay off the municipal building bond. But delays in getting federal approval for the construction costs prevented work from starting.

In 2018, a structural engineer’s report revealed the building was too small to house all the town departments, in particular the Police Department and the library. In June 2019 put it up for sale.

In another matter, Hodgkins told councilors that unless otherwise directed by them, the municipal budget for 2024 “is going to be substantially higher than the current budget.”

Blaming inflationary costs in services and goods, Hodgkins said the current budget “did not fully embrace the inflation that has ensued in 2022.”

“This next budget is going to have to reflect it,” he said. “I will try to put together a budget that respects the taxpayer, but this budget is going to be higher.”

The next budget “will need to reflect the times” outside of cutting services or staff.

Hodgkins said he has given the council “a heavy dose of some cold water for the right reasons.”

The town manager also told councilors the property revaluation is underway by O’Donnell & Associates.

According to a letter posted on the town website, property owners will receive an initial notification of the property’s new assessed value around May 2023 and have two months to informally appeal the figure.

Hodgkins also said the town’s 2022 Annual Report, produced by Town Clerk Janice Ferri, has been selected as a supreme first-place winner of the Annual Report Competition for the population category of 2,500 to 4,999.

The competition is sponsored by Maine Municipal Association.

Former Councilor Cindy Larrabee was appointed to the Budget Committee.

There are open seats on the Board of Appeals, Budget Committee, Development Commission and Planning Board.