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Taxes will be interesting in another decade

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City property taxes due on August 1st reminds us that Norwalk is still a commuter city with housing accounting for 90% of our long-stagnant grand list.  So the tax burden falls on homeowners whose property values have been falling in recent years in common with most of Connecticut.  Especially in the Gold Coast.  So what happens with another decade of tax hikes averaging four percent?  Homeowner taxes will be about 50% higher.  And it’s a good bet that with Connecticut’s economic problems building over recent decades our state economy will still be struggling. Housing prices too.  So in another decade city median homeowner taxes will be about $10,000 annually. That’s more than mortgage costs for a median-valued home in our city.  And not a good prospect for housing values.  Across the Sound in Nassau County it’s not uncommon for homes valued around $400,000 to have property taxes exceeding $10,000.  In some average-income communities, housing prices have remained pretty unchanged for several decades as taxes climbed to $20,000 and higher.

So what are our options?  In a struggling Connecticut economy the prospects for substantially boosting the business portion of our Grand List are modest.  The only realistic option to prevent further declines in city homeowner property values is severely restraining the city budget.  And that’s going to be a major challenge with parents demanding the BOE continue to match salaries with the surrounding wealthy towns.  City unions under our state’s generous arbitration statutes will certainly demand ever higher salaries.

Some will argue for adopting a professional manager.  But in our one party city there’s not much enthusiasm for such a major change.  And as long as our elected officials have modest business and management experience and avoid using professional search to secure top talent it will be very challenging indeed to restrain the city budget.

Norwalk will be in a tough spot over the next decade.  And subsequently.  The BOE’s recent demand for a $12.7 million budget increase really suggests our city needs to have some serious budget discussions.  If it’s “business as usual” Norwalk will follow the sad path of Connecticut’s other once-vigorous cities into a path from which there’s no visible escape.  Nassau County across the Sound provides a good example of how housing values respond to ever-higher property taxes.

Of course if one believes that all of Connecticut’s problems originated with Governor Malloy’s team then there could be a positive outcome.  But the well-documented facts are that our State’s fiscal and economic problems go back many decades. And can’t be easily resolved. It may take another decade or longer to reverse course.  So maybe it’s time to demand that our well paid city administrators do more with fewer resources.  Or at least not get annual salary boosts for simply spending more money than the prior year.

Without some very major changes in how we do business in City Hall, Norwalk homeowners will face ever higher property taxes on falling property values.  And few homeowners will retire here fundamentally changing the nature of our city.  Making it even more transient as lower-income families taking advantage of lower housing prices displace higher-income homeowners.  The real issue here is not focusing on changing our elected officials, but changing how we govern our city.  That may well be the greatest challenge our city has faced in modern times.  It’s a discussion we ought to begin.

Peter I Berman

Norwalk

4 comments

Rick July 29, 2018 at 6:06 pm

Thank you Peter i have one question for anyone..

How does these non profits work when buying a residential house and turn it into a sanctuary boarding house, I know there are lame rules on how many from the same family but the taxes on non profits accumulate to what?

One of mayors which one we leave open have long time whistle stop residents along with a non profit ready to build near the train station. The Non profit is from Greenwich and have a trail to a church like non profit.

We have repeatedly ask for help all we want is the law to be taken seriously lie lawn parking and sidewalk blocking where strollers have to enter travel lanes to pass.

We realize Firetree is a non profilt once they open the police dept will need to go to a unlisted number, Ems Fire and police will be called daily we pay for that does the city have the chance to bill non profits for service? Im talking excessive service.

Joe July 29, 2018 at 6:39 pm

Thanks Mr. Berman.

I think every year including Esposito, the tax on our modest West Norwalk house has increased over $300 per year. That’s way more than inflation. Way more!

Most of it’s going to the schools. Over 60%.

Our politicians are scared of the teachers and other unions. MBR Minimum Budget Requirement is a crooked bad deal for the taxpayers.

And to add insult to injury;

less and less is going to reading and writing, and more and more is going to social programs, eating and mental care.

Our teachers obviously (test results) have a hard time with the three R’s and now they’re supposed to be doctors too?

Piberman July 29, 2018 at 11:03 pm

Danbury’s approved Budget is $257 million. Danbury has 84,992 residents (2016).
Norwalk’s approved Budget is $343 million. Norwalk has 88,438 residents. (2016).

So why is Norwalk’s per capita budget outlay 33% higher than Danbury ?

Our City Hall is not professionally managed. Witness the Mayor’s “Reorg Plan”. Avoiding Prof. Search to secure Top Talent. Making embarrassing hires. Not employing mgmt. consultant firms for advise on how to reduce City outlays. Not asking/encouraging residents with major league business mgmt. expertise to provide assistance.

To be fair our former Mayors and Council members also ran City Hall in the same “amateur style”. So the solution is not changing elected officials but demanding they secure professional management of our City to provide affordable services. That’s a big challenge. Neither Norwalk’s GOP nor Dems have ever run candidates promising to reduce City budgets. So help is not on the way. Only ever higher taxes. And lower property values. Without major change in how our City is managed we know our sad future.

A good first step would be Mayor Rilling asking for help in lowering City outlays and taxes. There’s no shortage of professional managers among Norwalk residents. It’s not rocket science.

Bill Nightingale July 31, 2018 at 3:54 pm

Totally agree. The status quo of 3-5% budget increases every year has to change soon. It is unsustainable.

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