GEORGIA — Dam Store owners Richard and Florence Damon defaulted on their mortgage, and the bank has filed for foreclosure, records show.

This news comes a few weeks after townspeople noticed the popular Route 7 convenience store appeared closed, despite signage out front advertising its deli is open until 4 p.m. daily.

The general store is the only one on the nearly 4-mile stretch between Simon’s in Milton and Georgia Market down Route 7. Its prime location caught commuting traffic, and its house-made sandwiches, soups and 99-cent coffee drew customers.

The Damons bought the store from Colchester residents James and Elise Brault in September 2008, who renamed it The Dam Store & Deli due to its proximity to the manmade dam on Lake Arrowhead. It was coincidence the Damons’ name fit with the already aptly named store, James Brault said.

Property records show mortgage holder People’s United Bank filed a complaint with the Chittenden Superior Court – Civil Division on January 14, alleging the Damons haven’t paid dues under three promissory notes; it has moved to foreclose on the store, located at 89 Route 7 North, at the Lake Road intersection.

The interchange itself illuminated the Dam Store’s financial woes in 2011, when the state sought to realign the troublesome turn and effectively cut off access to the deli and gas station for six months. Owner Richard Damon said the work halved his profits during the busy summertime.

A year later, the Milton Independent reported the store was still struggling to rebound. Richard Damon told the newspaper then that even two months after the work finished in December 2011, he couldn’t afford to fill up his gas tanks. He cut staff from 13 to five.

“For an independent mom-and-pop retailer, it’s devastating,” he said.

Then, in summer 2012, Damon estimated it would take at least three years to rebuild the Dam Store’s clientele.

The construction coincided with another blow in the Damons’ personal life that led to the store losing its liquor license and thereby more profit.

Milton police cited the couple with felony cultivation and possession of marijuana in August 2011 after discovering 25 pot plants in a helicopter flyover of the Damon’s Colchester home, the Milton Independent reported.

Court records indicate Flo Damon’s cultivation charge was dismissed in February 2012; she pleaded guilty to a misdemeanor possession charge and paid all fines. Richard Damon pleaded no contest to reduced possession charges, and the cultivation citation was expunged.

However, on a March 8, 2013 liquor license renewal, Damon disclosed he’d been convicted of or pleaded guilty to a felony charge, the document shows.

Milton’s Selectboard approved the application, but the Vermont Liquor Control Board wasn’t as lenient.

Dated May 13, 2013, the denial outlines Damon’s crime, for which he served an 18-month deferred sentence, a result also supported by court documents. Damon told the liquor board he and Flo grew pot for medical reasons, but his doctor declined to prescribe it.

Damon told the board it was “the poorest decision he ever made,” but because the conviction was so recent, Chairwoman Stephanie O’Brien said the board didn’t have sufficient evidence to prove that granting the liquor license was best for public safety, the decision reads.

Speaking generally, Liquor Inspector Jay Clark, also a part-time Milton police officer, said many convenience stores generate a good portion of income from liquor and tobacco sales. As the economy dove, the state saw increasing alcohol sales from stores instead of from restaurants and bars, he said.

“Alcohol sales have been a large part of every store’s overall business, and that hasn’t changed,” Clark said. “You’d be selling yourself short not to have alcohol sales.”

But because the Damons didn’t have the choice, the shelves that once carried an extensive beer and wine selection were replaced with smoking paraphernalia. Some Miltonians boycotted the store.

Multiple attempts to reach the Damons over the last two weeks were not returned by press time,  leaving many questions open as to the store’s future. Flo Damon’s attorney, reached on deadline, said couldn’t reach her client so declined comment; Richard Damon’s attorney did not return a call.

Reached at home, former Dam Store owner James Brault spoke excitedly about the shop’s past and said he and his wife might be interested in rebuying their old business.

The couple built the foundation for the present-day store, renaming it from Lake Road Variety, installing gas pumps and dusting off unused deli equipment. Brault was disheartened to learn about the Damons’ legal trouble and the store’s resulting fate and said his family is “toying with the idea” of rebooting it.

“No one would know how to do that better than us, because we started from scratch,” Brault said.

“From scratch” was the couple’s M.O. Brault recalled his wife’s homemade touch that brought pasta salads, slow-roasted ribs and even chicken Marsala to early Dam Store lunch menus. But after working 16-hour days and raising young kids caught up to them, the couple sold to the Damons, hoping the new owners would continue their dream of expanding fledgling catering operations.

“We just had a view for the kind of unique, mom-and-pop [store] that was high quality and friendly and community oriented,” Brault said. “That would be our vision should it come back around to us.”

For now, the Braults are keeping an eye on the store’s happenings. The Milton Independent has separately heard from one other resident interested in a potential future sale.

Courtney Lamdin is editor of the Milton Independent, a newspaper affiliated with the Messenger.