Derry Town Council Chair’s Research Clarifies 4-A Status

Council Chairman Mark Osborne’s research skills benefited the town this past week, helping the Council make sense of the town’s history with the proposed Exit 4-A.

Now they just have to decide what to do about it.

Osborne has spent the past few weeks digging through documents and making a chronology of the town’s involvement with the project, which would put a new exit between exits 4 and 5 off Interstate 93. The conversation goes back to 1985, Osborne said. He urged television viewers to “get comfortable, get a drink and put your feet up” as he went through his findings.

“In our last meeting we discussed the expansion of I-93 from Windham to Manchester,” Osborne told the Council and audience. “It’s difficult to discuss that without discussing 4-A.”

“There are a lot of assertions, a lot of opinions,” Osborne said.

These boil down to two questions, according to Osborne: Is Derry bound to contribute $5 million toward the project, and is Exit 4-A a good choice for Derry? While the regional benefits have been touted, Osborne said, “We all want to see Southern New Hampshire succeed. But our first interest is Derry.”

Osborne summed up his research as follows:

• Derry never signed a contract obligating itself to 4-A.

• There is no evidence of papers being “lost, stolen, burned, or meeting another nefarious fate.”

• However, Derry has acted as a partner and participant in promoting 4-A, and this produces a moral obligation to honor its promises.

Back to the future

The first discussions on 4-A began in 1985, Osborne said. To give some historical context, “That was the first year of Reagan’s second term,” he said.

Planning the exit was a joint project among Derry, Londonderry and a developer called Boston North, he said.

The project needed authorization by the General Court in order to receive state technical support, and this was granted in 1987, Osborne said.

The General Court ordered the state Department of Transportation (DOT) to cooperate in the design, Osborne said, and it was agreed that the interchange would be funded and designed by Derry and Londonderry, with no state funding.

In March 1990 Londonderry and Boston North entered into a written agreement, Osborne said, which read in part that the Town of Derry wanted the new exit to relieve congestion and foster growth and development. While Derry did not sign the agreement, “it did not disavow it either,” Osborne said.

In March 1991, Osborne said, Londonderry held a referendum among its residents to see if they wanted to cancel the agreement with Boston North. Boston North sued Londonderry for breach of contract. At that time, Osborne said, Derry once again did not “disavow” its commitment.

In March of 1987 Derry and Londonderry engaged the firm CLD to do the environmental impact study, or EIS.

In July of 1988, Derry, Londonderry and Boston North “agreed in principle” on the next steps, according to Osborne. Derry was to post a $1.1 million bond to build the connector road and bypass. Derry was also to contribute $5 million to construction costs, allow the use of its wastewater treatment plant, and develop a Capital Improvement Plan for the road. Again, Derry did not disavow the agreement.

In May of 1991 the DOT sent a letter to the Federal Highway Administration on behalf of Derry and Londonderry, asking for federal funds to complete the project. The letter stated that Derry had executed a $1 million bond and “was committed,” Osborne said. The then-Council was copied on that letter, and again, “they took no steps to disavow it,” Osborne said.

Boston North and Londonderry finally settled their legal issue in February of 1992, with the provision that Derry and Londonderry each contribute $5 million, or 50 percent of the projected exit costs. There was a provision that if the costs exceeded $10 million, all participating parties would contribute to the excess, Osborne said.

Again, Derry made no recorded objection to the agreement, according to Osborne.

In April 1992, Boston North stated in a letter to Derry how it was “relying on” Derry to begin preparations for Exit 4-A. “They used the word ‘reliance’ no less than five times in eight pages,” Osborne observed.

But in August 1992 Derry’s attorneys wrote to Boston North that Derry was not bound to proceed with 4-A unless it was presented to residents and adopted by them.

Boston North and Londonderry signed a supplemental agreement to terminate the arrangement on Jan. 1, 1998, unless Derry had raised and appropriated its share.

“Derry did not sign that agreement, but did not disavow it either,” Osborne said.

No formal commitment

On Sept. 16, 1997, Derry’s then-Council passed a resolution to raise and appropriate $5 million for the town’s share of construction costs for the proposed 4-A interchange off I-93. Osborne said the vote was 6-1. They would issue the bonds through the Municipal Finance Act, Osborne said. But as Derry had not been part of the supplemental agreements, the town would have to discuss its action with Londonderry and Boston North.

In March of 2008 a special committee met, including three Executive Councilors, then-Town Administrator Gary Stenhouse, Derry Planning Director George Sioras and then-State Sen. Robert Letourneau, R-Derry. Osborne read the minutes of that meeting and observed that Chris Bean of CLD said at the time that Derry was committed and no one objected. The Executive Council unanimously approved the project, Osborne said.

In September 2009, CLD sent a letter to Stenhouse outlining its fee for the EIS, which would be $982,000, or $441,000 from each town. “They did not disavow that,” Osborne said.

On Jan. 8, 2010, the town received a letter stating that Boston North had transferred its interests to a company called HYRAX LLC. The letter stated that there was an understanding that Derry was limited to spending its $5 million, minus the money already spent. Again, this was not disavowed by anyone from Derry, Osborne said.

Where we’re at now

“Thus far,” Osborne said, “the town has spent $1,749,921 on 4-A.” This leaves Derry on the hook for $3,250,779, according to Osborne.

Correspondence from HYRAX indicates that Derry is only obligated for the $5 million, Osborne said. But the agreement between Londonderry and Boston North seems to indicate that Derry would be required to bond more than $5 million if project costs went over the estimate. “It’s ambiguous,” Osborne said.

“Is 4-A ‘good’ for Derry?” Osborne asked his fellow Councilors. “What’s not good for Derry is if the town breaks its promises.”

In the public forum part of the meeting, resident and Realtor Steve Trefethen observed that the economy had changed since 1987. The original plan for 4-A predicted that 28 percent of the downtown traffic would be rerouted, he said. But with the enhanced commercial strip on Manchester Road, including a movie theater and Walmart, “that would take 50 percent of the traffic off Broadway.”

Trefethen predicted that the loss of traffic would hurt the downtown merchants.

Resident Doug Newell said, “We do not have a legal obligation to fund a project that is not happening.” He urged the Council to have a nonbinding referendum of citizens and said, “If the state backs away, this thing will collapse under its own weight.”

Newell added, “This will be a tough case to fight in court. They (HYRAX) can’t come out against democracy. This is the First Amendment.”

Resident and former Councilor Kevin Coyle expressed concern about the mounting costs of the EIS and the lack of product from same. “We’ve been in this 27 years, we’ve spent $1.7 million, and the Environmental Impact Study still isn’t done? “This Council needs to get that done,” Coyle said, noting that it took only 410 days to build the Empire State Building.

Resident Roberta Robie, who worked on the original committee for 4-A, commended Osborne on his research and said, “I think we should finish the EIS. Then we’ll know where we stand.”

Osborne said the town would consult its legal counsel about its obligations. “Not everyone will be happy with the answer,” he predicted. “But the town and residents deserve some certainty.”

“It has landed here and it’s not going to go away,” Osborne said. “We are not going to pass the buck.”