THABACHA/FORT SMITH - Three years after the town of Fort Smith demolished the Pinecrest Hotel, the area's MLA is raising questions about how funds put towards the demolition were handled.

Michael Miltenberger, MLA for Thebacha, is questioning whether the town should have repaid more of the $800,000 the GNWT put towards the removal of the 27,000-sq.-ft. building.

In an interview with the Slave River Journal, he said he "distinctly remembers" discussions between the town and the GNWT about the town's ability to take over the lot and re-sell it to compensate some of the money the territorial government put towards the hotel's demolition. He said he hoped the town's financial audit would explain what happened. Miltenberger didn't return phone calls to News/North.

Fort Smith Mayor Peter Martselos said Miltenberger's comments came "out of the blue." Martselos pointed to a Dec. 7, 2005 letter from Miltenberger thanking the mayor for the "extraordinary efforts [he] personally undertook" in dealing with the Pinecrest Hotel.

"There was nothing about the town selling the property," he said. Martselos said there was never any agreement with the GNWT to repay the money or for the town to sell the lot. He said the town already paid back $114,035 to the GNWT because that money was left over after the demolition.

"This property was available to whoever had the money to buy from the owner. We never have any restrictions through us ... As long as we have our tax money, it's their concern," said Martselos.

Fort Smith's SAO, John Holland, said there was a contribution agreement between the town and the GNWT but he said he couldn't disclose the contents of the agreement.

The fire marshal ordered Fort Smith's Pinecrest Hotel to close in December, 2005. The evacuation forced 30 long-term apartment dwellers to find other accommodations

One year later, fire marshal Bernie Van Tighem told News North the town of Fort Smith could try to recover some of the cost of the demolition through property tax. Failing that, he said the town might take ownership of the land.