Eliot brewery closes amid dispute between town, pub owner over $100K
The closing of Shipyard Brew Pub in Eliot marks the end of a two-decade-long chapter for the beloved local establishment, but the story of its shuttered doors is far from over. Owner Fred Forsley, who also owns the Eliot Commons plaza that housed the pub, attributes the closure to a combination of rising operational costs and an ongoing legal battle with the town over roughly $100,000 in disputed reimbursements.
At the center of the conflict is a 30-year tax increment financing (TIF) agreement established in 2009, which allowed the town to create a district to fund eligible economic development projects. Town Manager Michael Sullivan states that the agreement was explicitly tied to the construction of an $11 million, 90-to-110-room Hampton Inn hotel—a project that was never built. Instead, Forsley constructed a housing community for residents aged 55 and over. Forsley maintains that the town agreed to this change in plans after he presented a feasibility study conducted by a hospitality management group, spending over $15,000 in the process to try and get the hotel approved.
"You don’t do a study and not share it with the town. I spent over $15,000 to try to get a hotel approved,” Forsley said. “In my opinion, it’s just a complete fabrication to stop payments in which I believe I’m owed."
The financial stakes are substantial and heavily contested. According to a June affidavit from Town Manager Sullivan, the town paid Forsley more than $826,000 before suspending payments in 2024. However, the total cost of the actual investments in the plaza was just over $627,000, leading the town to assert that it overpaid Forsley by approximately $200,000. Sullivan alleges that Forsley utilized these TIF funds to subsidize the brew pub rather than making the expected capital improvements to the property.
“The purpose of the TIF and the Credit Enhancement Agreement, at the heart of it, is to make improvements to the property, not to keep your bar open,” Sullivan stated.
Forsley strongly denies these claims, arguing that the TIF funding primarily went toward the senior housing development. He points to the rising costs of running the business and the ongoing litigation as the true reasons behind the brew pub’s closure.
The legal dispute, which Forsley filed in York County Superior Court before it was transferred to the state’s Business and Consumer Court, has reached a critical juncture. Recently, Judge Michael Duddy denied a request from Forsley’s counsel for a temporary restraining order that would have forced the town to sequester TIF funds in escrow. Court documents filed by the town’s attorney, Scott Dolan, indicate that the purpose of the restraining order was unclear, and highlight that Forsley missed a mandatory 30-day appeal period following the town's final decision that Sea Dog Realty was not owed further funds.
Proceedings are pending, but Judge Duddy has noted that the town is anticipated to file a motion that could resolve parts or all of the litigation based on the missed filing deadline. Sullivan remains firm on the town's position, but left the door open for a resolution if the courts dictate otherwise: “If we owe the $100,000, then we would pay him — but by order of the court.”
