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Opinion: Proposed Norwalk incentives would increase tax revenue

Head of the Harbor South, above, is essentially the only completed development in the Wall Street area in 30 years, according to the developer, who supports proposed tax incentives that would spur new construction and thereby increase City tax revenue.

The Norwalk Redevelopment Agency has previously proposed a plan for real estate tax incentives to spur investment in the redevelopment of the Wall Street and West Avenue areas. This proposal was earlier referred to as the Innovation District and is now a proposal in the form of an ordinance. There has been some opposition voiced to the notion of tax incentives in general, but the reasons articulated are counter-intuitive to the goals of tax incentives and redeveloping designated areas of the City. Any discourse on tax incentives should begin by making sure that the community understands what a tax incentive actually is. We believe this discourse has been missing.

First and foremost, there exists a myth that tax incentives are an abatement of taxes that already exist and are currently collected by the City, thus resulting in a decrease in the City’s tax income collection. This is NOT true and is actually just the opposite of what the main goal of tax incentives are. Tax incentives are a tool for ADDING tax income to the City. Tax incentives are a short term discount on NEWLY created taxes when a business, developer, builder or any other entity creates something new that becomes part of the grand list and adds new tax income. New tax income is immediately paid to the City and this is tax income that did not previously exist. When a tax incentive is granted, this newly created tax income is allowed to be partially discounted over the short term as a way to spur investment. As will be further discussed below, potential projects or business opportunities would not be pursued without the economic benefit of a tax incentive.

Our company, M.F. DiScala (including strategic partners) has projects in the planning stage that cannot move forward without some type of tax incentive. When one invests money (in anything) there is a fundamental requirement during the formulation of an investment or business plan that the equity investment creates a return or profit. One cannot knowingly invest with good fiduciary faith in an investment that merely breaks even or yields almost no profit. This brings us to redevelopment areas. Unfortunately, when investing in areas that are designated for redevelopment (such as the Wall/West area) there generally exists some economic degradation and/or current lack of desirability. Many would refer to these areas as “up and coming” or in need of “renewal”. These areas, which provide hope and opportunity for many are sadly, typically, economically depressed areas. As such this creates an environment where investment is risky and any normalized financial returns on an investment take many
years to come to fruition. What tax incentives do, which is their crucial role and the exact reason they were invented and are used widely, is to create a level playing field.  Tax incentives reduce some of the elevated risk and allow a business/investment plan to mitigate substandard equity return dangers. In other words, tax incentives allow investors and businesses to make investments that otherwise do not make sense financially.

We recently completed a project in the Wall Street area which is essentially the only new development (completed) in the area for over 30 years. The only reason/way we were able to make sense of our investment plan in the Head Of The Harbor South project was because we were going to occupy a portion of the property as a user/owner. Our new
offices are located within the project and this allowed us to go ahead with a project that did not make sense from a financial/investment analysis in the redevelopment area. If we had not made the choice to relocate our offices to the project we would not have been able to move forward with that project without tax incentives. And frankly, our real
estate taxes today far exceed the projections we had based on historical information. If we had known previously the outcome of our current real estate taxes, we likely would not have built Head of the Harbor South even as a user/owner. I think most people in the City agree that, since its completion, Head of the Harbor South has been a positive addition to the Wall Street area and Norwalk as a whole.

Local business overall is not thriving in the Wall Street area as half of the storefronts are vacant. This is not a new phenomenon but has been one that has troubled us and the community for years. The key to retail success in the Wall Street area is people and we do not have anywhere near enough. Very few people come to Wall Street and the
northern part of West Avenue directly as a shopping destination, unless they happen to already be there. The area needs more people that actually live and work in the neighborhood in order to help local businesses and property owners become successful.

Over the last 30 years we have had a business in the area, been property owners in the area and have been vocal supporters of the area and Norwalk. As such, we say with expertise and optimism that the proposed tax incentive ordinance is required for the area to continue forward with its renaissance. From a business perspective, the high risk level and inability to forecast a profit makes it near impossible to initiate smart investments in the area without tax incentives. It is for this reason that the majority of the small cities around us (Stamford, Fairfield, Stratford, Trumbull, Milford, Danbury, Waterbury, Bridgeport, New Haven, Port Chester, White Plains, New Rochelle – just to name some in proximity) utilize tax incentives and why we fully support the proposed ordinance.

Another myth in regard to tax incentives is that they are “just for big developers” but this is simply not true. All property owners and business owners can take advantage of tax incentives; they just have to be comfortable with the level of risk and the profit potential of their investment – just like any other investor, big or small. Yes, it does require an investment into property, but that comes with owning real estate whether big or small. The risk and potential are the same regardless of the size of your equity investment. Our company committed to this area over 30 years ago and continues to do so today. In fact we doubled down on our commitment to the area by building Head of the Harbor South. However, over those 30 years, we have seen virtually no other significant positive change to the area. It is time for it to happen and we firmly believe that the tax incentive ordinance will be a primary tool in advancing the success of the area. And again and with emphasis- at no cost to the City or taxpayers, contrary to the often promulgated local myth.

In closing, it has appeared that no one has taken the lead to step up, clear the record and communicate plainly about tax incentives – even as vocal opposition has continued to speak a distorted rhetoric. We feel it is time for us, as longtime stewards and stakeholders of the area, to stand up and speak factually, frankly and favorably for the tax
incentive ordinance. The area needs it and we fully support it. We would be happy to sit down and further the conversation, on an individual basis, with anyone who would like to get a more in depth understanding of our views.

Thank you.
Michael F. DiScala – President, M.F. DiScala & Company
Alan Webber – CFO, M.F. DiScala & Company
Jason Enters – Principal, EDG Properties
Bryan Dietz – Principal, EDG Properties

 

 

38 comments

Dave McCarthy March 10, 2019 at 7:15 am

Seems to me the company has a project they want to do, but they really want to do it if they will make tens of millions instead of just single millions. A basic rule of proper governance is to not change rules for one player..and that goes double when the single player has been hosting fundraisers and channeling money to the mayor for years.

Lisa Brinton March 10, 2019 at 9:32 am

Gentlemen,
Nice opinion piece advocating for tax incentives, but until we get rid of the alternating ‘thug, obstructionist, good old boy and cronyism culture’ at city hall, many residents are weary. It is NOT a level playing field as Milligan can attest and there is nobody at city hall that understands the complicated risks associated with real estate and commercial development.

This ‘biased optimism’ to put a more ‘positive spin’ on large development projects has resulted in residential taxpayers picking up the bill or bailing city hall out (think the OHPA restaurant, Police Station and Poko) when things invariably go wrong. It will also be years until the mall starts paying their fair share of property taxes to the city due to poor negotiation by the city. Why? It’s not their money.

As I said to you Mike, I am not against development, but I am against the repeated incompetence at city hall and the deceptive practices that may or may not exist with the Norwalk poster child of tax credits and financing – POKO. I am sympathetic to the ‘years’ it takes to get anything built or done with our silo city government, but I cannot support justifying that waste with tax credits. Making the taxpayer pick up the slack, so it’s easier for developers to improve their bottom line and justify wasted years at city hall does not deal with the root cause of Norwalk’s stagnation. We need professionalism at city hall. I’m sure you would agree.

Mitch Adis March 10, 2019 at 9:39 am

@MDiScala can you share with the rest of the class what incentives are available to the small real estate investor? Last I checked there were none. For example, if iI buy a depressed property and invest money in it for major improvements the City raises my taxes. Is that the incentive you are talking about? That differs from the benefits you recieve. By A LOT. No pun intended since you are asking for a free lot in the Wall Street area as an incentive to develop the property.

Mike Mushak March 10, 2019 at 10:21 am

Thank you.

A much-needed perspective, as it appears the debate has been taken over by a few folks who comment incessantly on this site and in the Hour with negativity and nastiness towards city staff and elected officials, including a strategy of deliberately spreading misinformation to frighten people.

Much of that nasty commenting is nothing more than self-serving political nonsense by folks who would rather see the city fail than succeed, just to score a few brownie points in their small community of bickering no-growth naysayers.

As the letter points out, the tax incentive program Norwalk uses is not a “giveaway” of public funds, but a temporary delay in paying the full amount of taxes owed on new projects bringing new residents and businesses and jobs to our struggling downtown, that add to our tax base through private investment.

It’s a strategy used by every city in the country, and not using it will basically direct that investment elsewhere to nearby cities that do offer generous incentives. Taking ourselves out of this proven system will insure Norwalk slows down as an engine of economic growth, which will affect every single taxpayer and business owner in a bad way and at which point the naysayers would all disappear into the weeds to avoid being blamed. It always happens that way.

In fact, it would be the stupidest mistake the city could ever make to discourage investment in our urban core at this point in time, just as Norwalk is creating a momentum for high-paying job growth and expanding housing choices in an area with a severe housing shortage including affordable housing.

Change can be scary but Norwalk has always changed in its long 368-year history. In fact, historical census data shows Norwalk often increased in population by 30-50% over 10 year periods, including all through the 19th century and into the 20th, most recently in the 1950’s and 60’s. Our growth rate now in the last decade was about 5%, a far cry from the past eras of great change. The fear that we are “becoming Stamford” or even “Manhattan” as someone said recently is so far from the truth as to be absurd.

We have strict zoning in place to prevent that ever from happening, yet we need to continue to grow to attract new residents and businesses or we will surely decline into a city of deserted downtowns with a stagnant grand list. Been there, done that. That’s not a healthy vision for any vibrant, diverse, and healthy city to have.

Mitch Palais March 10, 2019 at 10:23 am

Good morning

I have two questions.

1. If the mandated subsidized housing component was removed how would that change the economics of planned projects?

Would the projects – with greater income be more financially do able?

2. What other regulations could he removed that would add to the financial success without tax abatements?

Alan March 10, 2019 at 10:28 am

The Norwalk Redevelopment Agency is a group that apparently operates beyond the scope of city government. This agency is the biggest do nothing, myopic, group in the city. I have been in Norwalk since 1959. It was a vibrant city. Post anchor store bail, this city has stagnated for decades. Ok so now apartments have appeared. And the city reaps what? A bigger burden? Now the agency is expecting for tax payers; who recently have been subjected to an insane evaluation, will be expected to pay more? Not happening. Fire ALL of these people who have no viable vision for the city. Reuce taxes by streamlining and bring in business willing to pay their fair share.

Jason Milligan March 10, 2019 at 10:55 am

The greatest incentive of all would be a low mil rate. The city mil rate is applied evenly to all taxpayers!

The best and fairest way to provide short term tax incentives is to make them available to all. No application or special relationship rewuired.

Jason Milligan March 10, 2019 at 11:48 am

Tax incentives often do not provide the desired results and they can have severe negative consequences. Not the least of which is to unfairly advantage large and well connected business owners. The incentives can give said businesses an unfair advantage and allow them to out bid others in the market place.

Google-Do tax incentives work. You will find that the incentives often are a political tool that have limited positve effect and often negative consequences.

https://www.citylab.com/life/2017/03/business-tax-incentives-waste/518754/

Piberman March 10, 2019 at 11:50 am

Thousands of cities across America successfully encourage major business development focusing on bringing good well paying jobs. Not handing out the monies. What’s the “secret”’. Hiring senior level Business Development Pressionals at City Hall with demonstrated accomplishment. Electing City Hall leaders with business experience and knowledge of eocnomic development fundamentals. And a citizenry proud of their City’s governance. Together with recognized competence by the business community in how the City is managed.

Stamford showed how to bring good jobs and major development to a City once similar to failing Norwalk. No amount of monies handed out in tax incentives will bring significant new jobs and major corporate investment to Norwalk without a far more capable City Hall team staffed with Development Professionals earning a strong reputation in the business community.

Norwalk’s shabby Downtown remains a long standing illustration of ineptness at City Hall.
Hiring an Economic Director from tiny Newtown followed by a transporation successor illustrates the point. Before handing out the millions of incentives the first order of business is to install a City Hall team capable of overseeing the project. Otherwise its just another giveaway shouting “bring on the renters”.

PIBerman
Co-President, FEI, CT Chapter
FEI is the nation’s organization of major firm Chief Financial Officers.

Piberman March 10, 2019 at 12:12 pm

Does Norwalk have the major league Professional Business Development Team in place to oversee granting of millions of taxpayer funding to encourage good jobs and major business investment to a City with a long shabby Downtown ? Past hires of an Economic Director form tiny Newtown followed by a transporation staffer suggest otherwise.

Are Norwalk officials studied how Stamford City officials transformed their City into CT’s “Greatest City” ?

Or is the goal not bringing vitally needed good jobs and major corporate business investment but encouraging more developers and more renters transforming Norwealk into a “renters City”.

Bryan Meek March 10, 2019 at 12:15 pm

Where did the $5 million in cash to Poko go? Where did the $900k fraudulent wire transfer go? FINCEN would be able to track all of these payments and where they ended up eventually with a few exceptions like Iran and North Korea? Why are tax payers not allowed to see where our money is going? How many more years will it take to get a full accounting of Poko? Will we ever know where the $900k ended before it walked out of some bank in a bag of cash?

Mike Mushak March 10, 2019 at 1:55 pm

I see Florida resident and former Norwalk troublemaker (and notorious peddler of racist flyers) Dave McCarthy is back again helping his dear friend and favorite candidate Lisa Brinton spread slander and misinformation to try to help her get elected, a nasty formula voters always reject in Norwalk.

And reading a lecture from Lisa about “thug” behavior by others is pretty ironic. Lisa can’t seem to be able to make a comment anywhere, in person or in writing, without acting like a thug and trash-talking the city and so many folks who work hard every day to make it better. It’s tiring, really.

The published letter clearly did not ask for preferential treatment. It is absurd to suggest that a local resident and developer with the good reputation of Mike DiScala, with a long-standing record over decades of investment in Norwalk to make it better, is going to profit from illicit activity in City Hall.

If I were DiScala, I’d get a lawyer and sue McCarthy immediately for slander for making that baseless charge, clearly meant to do harm to his business and reputation.

Discala has done more to help Norwalk on any given day than Lisa Brinton or her main supporter and dirty politics henchman Dave McCarthy have ever done over many years.

It’s all on the record.

Ron Morris March 10, 2019 at 3:27 pm

Oh I see that Mr. Generic copy and paste of the same old same old fact less nonsense Piberman has been hard at work. Tell us Piberman are you capable of making a post without the same old nonsense? Do you ever have anything good to say about Norwalk? Also you may want to actually look at the resumes of these city employees that you claim have no professional experience, as you find that you are wrong once again.

Lisa Brinton March 10, 2019 at 3:27 pm

@ Mike Mushak, Nice try. My reference to ‘thug culture’ refers to the ‘fear of retribution’ that hundreds of residents and businesses have shared with me regarding City Hall’s political behavior if one dares challenge the status quo – not Mike DiScala. Your repeated false diatribes and ‘dog whistle’ statements against me are reprehensible and the opposite of my few polite conversations with Mr. DiScala. However, I think even he has grown weary of the silo culture of mismanagement, added expense and decades of delays. Tax incentives won’t fix City Hall’s mismanagement, but I suppose I can’t blame his organization for trying.

Adolph Neaderland March 10, 2019 at 4:53 pm

Mike. suggest you focus on the reference to Richard Florid’s article before you berate folks who do not think the way you do.

Alan Kibbe March 10, 2019 at 6:22 pm

This discussion boils down to who takes the risk when building in Norwalk? In the case of tax deals (deferral, abatement, giveaways) it is the Norwalk taxpayer who absorbs much of the risk that a project will be successful and profitable. If the taxpayers’ gamble works out, the benefit to the taxpayer is more taxable activity (incomes, sales, property) in the state and community as well as more cars, more residents, more school children, and more civil servants in City Hall the PD and the FD. If it doesn’t work out, millions of taxpayer dollars are gone and we have a POKO-like eyesore in our downtown making the area less even less desirable than we were told it was. What the taxpayers deserve is an analysis of what the return on the investment of taxpayer money to assist developers actually is. Then the taxpayers via their Common Council can decide if the investment is worthwhile.

Norwalk Lost March 10, 2019 at 9:01 pm

Promoting crony capitalism has been a signature feature of city hall with sub-optimal results to date as residential taxpayers can attest. Tax incentives are also antithetical to a free market system by subordinating the competitive dynamic of development to backroom deal making. The depressed market values of Norwalk’s downtown should be incentive enough to attract development by potentially reaping multiples of their original capital from innovative concepts. Further, the higher tax creep and decade long property stagnation should be pause enough for the city to restructure its planning/development process.

Mike Mushak March 10, 2019 at 9:35 pm

@Adolph, you should read the Richard Florida article first, including the research it’s based on which the research authors admit themselves is incomplete and doesn’t include geographic-specific incentives like Norwalk has, before lecturing others to read it or that it somehow proves tax incentives don’t work. The research cited doesn’t prove anything at all pro or con about Norwalk, and in fact the article talks mostly about permanent incentives to specific industries on a state-wide basis, excluding any discussion of temporary incentives in geographically-specific zones in downtown areas that we have in Norwalk. The article you reference therefore is a moot point to this discussion. Nice try however.

@Norwalk Lost, why no real name? Ashamed to stand behind your statements? If your claim that economically depressed properties in our downtown are incentive enough to attract new investment, where is the evidence? We’ve been waiting decades for Wall Street to come back. How many more years should we wait for this economic miracle you predict to occur, 20 years, 30 years? Sorry, been there done that.

And news flash: taxes in Norwalk are stabilizing with most taxpayers not seeing increases this year, and the grand list is increasing (16% increase or over one billion). Also the city is restructuring its planning/development process on many levels, from zoning reform to marketing the city to rebuilding its schools and infrastructure. And your bogus claim that tax incentives are “back room deal-making” is nonsense. Where is your evidence that this has ever happened? Or is that a claim made behind a phony name for good reason?

Jason Milligan March 10, 2019 at 11:13 pm

Mike Mushak,

I find it interesting that you have so much to say to everyone else who posts. You are such a big shot, but you will never engage with me in person or in these comments. I actually think you are a smart guy with some decent ideas and obvious passion. Your die hard partisanship and protection of the mayor does grow old though.

I ask for and require no tax incentives. In the past year alone I have bought 4 properties on Wall st and I have another under contract. I am pouring money in to fix them.

I stand ready to build apartments above FC Bank, put a dentist in a former Chinese food restaurant and so many other things.

I am blocked at every turn by bureaucratic red tape and stagnant thinking.

The answer to solve Wall Street is not to follow the same failed approach with the same people in place.

A new approach with new people is needed. How many losing seasons should we endure before we fire the coach or the general manager?

Norwalk should roll out the welcome mat to small business and then get out of their way. Provide adaptive reuse regulations that encourage and reward the preservation and improvement of the historic buildings.

That’s all. Less cumbersome rules and process. Less government “assistance.

Tony P March 11, 2019 at 7:10 am

Long winded developer speak summed up : Taxpayer subsidizes the risk, the developer privatizes the profits.

Bill Nightingale March 11, 2019 at 9:56 am

DiScala and Sheehan are a near perfect echo chamber of each other. It is pretty clear who the Redevelopment Agency works for and it’s definitely not the resident taxpayers of Norwalk.

The bigger picture issue is that the Opportunity Zone feature in the new federal tax code provides all the incentive we need to redevelop Norwalk without any local tax giveaways. This is just all the more reason why it is time to abolish the Redevelopment Agency.

Jason Milligan March 11, 2019 at 10:15 am

I like and respect Mike DiScala. He is a stand up guy and a pillar of the community. I also understand his position about the tax incentives.

The problem in Norwalk is systemic and the tax incentives will do nothing to solve the larger issues. (lipstick on a pig) They make it easier to make money given the bad system and bad rules.

Tax incentives are a two wrongs trying to make a right.

Tax incentives are not the answer, but if Norwalk is going to employ them then they must be available to all who are willing to provide the results that are desired. There should not be a lengthy cumbersome and highly subjective process that will only reward the well connected.

Isabelle Hargrove March 11, 2019 at 12:16 pm

I disagree with the binary choice always presented by city hall and redevelopment – No growth or fortress projects with big tax breaks. There is a third option, promoting smaller developments with natural positive ROI that make sense financially without considerable, pre-set tax breaks. These will bring revenue, preserve our city’s natural character, and create an attractive town people want to live in and invest. These are the long-term sustainable options, not bureaucracy-force-fed fortresses.

I also disagree with Mr. DiScala on 3 of his points.

#1 – Redevelopment is not the party pushing for the tax breaks. Per the Ordinance Committee own statement last month during their monthly meeting, Mayor Rilling is pushing this. Tim Shehan himself confirmed that during the same meeting. Redevelopment has nothing to do with the tax break ordinance. They are only focused on their Wall Street – West Avenue “blight” plan. Granted it is a 2-punch strategy, but redevelopment is not the only problem here.

#2 Smaller players cannot possibly take advantage of these tax breaks. They can’t raise the capital or take the risk to fund projects that will increase their property value by a minimum of 100%. This is built to snuff out smaller players and pave the way for huge projects.

#3 With all due respect to Mr. DiScala lecturing us about tax breaks. Once again, I am offended by the continuous narrative from city hall, redevelopment and their operatives that the residents of this town are too stupid and ignorant to possibly know what is good for them and Norwalk. This culture must change!! We fully understand that developers will get an abatement on their taxes, not a $10M check. The problem is we still don’t like it. Our tax dollars will still be spent on needed infrastructure improvements to suit the behemoths or increased education needs. Also, smaller, more organic projects could be developed without large, pre-set tax breaks given at the discretion of city hall.

Finally, why are cities like Danbury negotiating “student impact fee” with developers to the tune of $500,000 – $850,000 annually as Norwalk votes to give blanket tax breaks without any negotiations. Not smart!

https://www.newstimes.com/local/article/Boughton-Matrix-redevelopers-to-pay-student-13450197.php

Mike Mushak March 11, 2019 at 3:35 pm

@ Isabelle Hargrove, I think you are onto something brilliant here!

Since you think requiring developers to pay for educating the kids their projects may generate is such a good idea, surely you would agree that any household with children, apartment or single family, should pay $17,000 per year for each child they have in the schools, right? I mean, what’s fair is fair.

Otherwise it’s just socialism, and we couldn’t have that now could we? Oh the horrors of it all!

Oh by the way, I have news for the naive folks who continually spout the nonsense with a straight face that “renters don’t pay property taxes”. They actually pay more per square foot on average than single family homes. Oops.

Which means renters in the larger mid-rise apartment buildings, most of them without children as we already know, are actually subsidizing the large single family households with children. Which means the more rental apartments we build, the more it helps fund our education budget!

Now there’s a revelation sure to ruffle some feathers, especially among the die-hard “down with renters” crowd.

Isabelle Hargrove March 11, 2019 at 5:57 pm

@Mike

I think this is exactly what people are concerned about. Renters no longer pay taxes when developers are getting tax breaks!

As far as schooling costs, education is expensive and maybe too expensive. Families with children can be looked at as a burden on their communities as you just did. But what does a community become without children? Educated children are future taxpayers and community pillars.

I am looking for balance and fairness for all players large and small and for a town with character and spirit as opposed to fortresses absent of soul.

Finally, as far as the user fees for developers, it is apparent that you are much more willing to give away the store without a fight than I am!

Mike Mushak March 11, 2019 at 8:30 pm

@Isabelle Hargrove, yes, you are so right. All those folks who live in those new apartment buildings don’t spend a cent in local businesses, don’t work every day in local shops to large corporations, and don’t contribute anything at all to society. In fact they are all leaches living off of us us good folks who live in “real” homes and are the only ones who pay “real” taxes! (This was sarcasm.)

Seriously, you need to “snap out of it” as Cher said once in a movie a long time ago.

First, a “tax break” given to a new project does not mean they pay no taxes at all. They pay the taxes the property always paid historically, and the higher taxes based on the improvements made are phased in usually over 7 years. The tax break is ALWAYS temporary only, and is NEVER a full tax break on all taxes owed. So let’s stop saying that a tax break means no taxes are paid, ok?

In the meantime, with each project you have of hundreds of construction jobs, construction materials being bought locally, and delis and restaurants feeding the crews at mealtimes. Basically its a huge stimulus to the local economy supporting many jobs and small businesses for the duration of construction that can last years and adds up to millions per year.

And now lest look at when the building is filled up with residents, many of whom are already Norwalkers who have chosen to downsize or upgrade or get their first apartment out of college in a walkable neighborhood where a lot of folks wan to live now. I know a lot of folks personally who live in Avalon and Waypointe and Ironworks etc., of all ages from early 20’s to retirees.

What is that stimulus worth to the local economy, in terms of money spent for everything from restaurants to healthcare to transportation to hair salons to you name whatever you spend money on to live? The Urban Land Institute has figured it to range from $60 k for a 1-bedroom single occupant to $90k for a 2 bedroom-2 income household per year..

For the 230 East Ave project by the East Norwalk train station, that annual economic benefit came out to over $13.5 million a year, including $800,000 in annual property taxes (they received no tax break) and $12.7 in local economic activity from the residents in the 195 units which are mixed studios, one- and two-bedroom units. (10% or 20 units are permanent affordable workforce housing.)

The schoolchildren anticipated for that project is 20, based on 0.1 child per unit which is based on accurate data from other similar projects. At $17k per child per year, that cost of $340k is easily absorbed by the total economic benefit of $13.5 million, leaving a net benefit still over $13 million a year. Thats an awful lot of tacos and haircuts and car repairs and doctors visits and whatever helping to support hundreds of small businesses and thousands of jobs. I agree with Linda McMahon on one thing she has always said, in that small businesses are the backbone of our economy. As a small business owner, I know she’s right, an dI know each new project in Norwalk supports an entire ecosystem of jobs, which benefits all of us.

The 230 East Ave project will also need water, electricity, and sewer service which is all paid for and supports the local utilities, and all their respective engineers have determined the infrastructure can support it without upgrades as they are all consulted for sign-offs during the approval process.

So Isabelle, what was that you said about “giving away the store?’ I beg to differ, as do hundreds of other small business owners employing thousands of local folks! And let us not forget why both Diageo and GE said they were leaving CT for Boston or NYC. It wasn’t taxes (although GE played politics with that for fun for awhile). No, they both said it was the “scarcity of talent”. Big corporations and start-ups want to be where talent is, and Norwalk is building a pool of talent with each new project to keep the talent here instead of migrating to bigger cities which is happening all over the country.

Isabelle, please, snap out of it! I say that with love in my heart.

Adolph Neaderland March 11, 2019 at 9:21 pm

Mike, I didn’t plan to continue this exchange, but after rereading the Florida article as you suggested, I conclude that perhaps you have not yet read his article.

Let me point out to anyone reading this exchange, it is my understanding that Norwalk does not have a requirement for a developer to submit a formal, verifiable ROI (prepared by a reputable accountant) justifying a project.- We, the public get “words” such as “will increase the Grand List” with no supporting data.

Incentives are, in effect a loan by the taxpayers. As such, should require an ROI, just as any bank would require , for a 5 or 10 year projection, with some specified return. If the ROI does not meet thier criteria, no loan.

urther, our requirements are rather sloppy. As I understand the process, there isn’t a penalty if the the recipient defaults. ( I may be incorrect on this point, but I couldn’t find evidence to a penalty. viz POCO).

In a recent report by RED, it lauded an increase in taxable income over the past 5 years of development, however over that same period our Grand List hardly moved (a approx 3% total). Hardly justifying taxpayer supported incentives.

So, my friend, you may interpret the Florida report any way you see fit, but it provides some data. You choose words, not data. Why not push for a justifying ROI and hold the sponsors accountable.

Mike Mushak March 11, 2019 at 10:45 pm

@Adolph, first, our grand list increased 16% over the past 5 years, not 3%. That equals over one billion but I couldn’t get an exact figure at the time I asked. I’ll try to find out but it was good news by all accounts.

I pretty much ignored the blanket opinions stated by the author of that article you referenced, and instead looked closely at his research he based his conclusions on. It’s clear he had a bias in his interpretation as it is completely misleading for him to claim “tax incentives don’t work”, as the researcher himself admitted he was only looking at permanent industry-wide incentives on a state-wide basis and not on temporary geographic-specific zones in urban areas like enterprise zones, like we have in Norwalk.

The researcher stated it himself, buried in the 100 pages of so if research I had to read. I am always curious when folks make outrageous click-bait claims to get their readership up so they can sell ad time. Always a good idea to dig deeper.

In other words, don’t believe everything you read on the “internets” as George Bush used to say.

Lisa Brinton March 11, 2019 at 11:25 pm

@ Mike Mushak, Can you comment on the pending sale of the Garden Cinema, so it can be turned into a parking lot to make up for the Poko mistakes made by the city and redevelopment agency? As a former zoning commissioner, current planning commissioner, landscape gardener and someone who wants to preserve Norwalk’s history, I’m curious to your thoughts?

Mike Mushak March 12, 2019 at 12:48 am

@ Lisa Brinton, I’m sure you know just the guy to ask about that subject, who I’m sure can explain why that transaction may be necessary. I won’t comment on pending sales, but I’m flattered you value my opinion nonetheless. Good night.

Jason Milligan March 12, 2019 at 1:05 am

Tear Down the Tyvek Temple NOT the Garden Cinema.

Redevelopment in conjunction with Citibank and JHM want to Pave Paradise & Put up a Parking Lot…

Lisa Brinton March 12, 2019 at 7:08 am

Mike Mushak, You personally attack those of us who question the secrecy and convoluted nature of Norwalk’s land use which has cost taxpayers millions. However, when I ask you a legitimate question, you hide behind the secret deals as well. You my friend, have become City Hall’s most vocal status quo advocate. Keep the deals quiet and under the public radar, then attack anyone who challenges. Good morning.

Holden Caulfield March 12, 2019 at 2:24 pm

“If we had known previously the outcome of our current real estate taxes, we likely would not have built Head of the Harbor South even as a user/owner…”

Is that an argument for larger tax breaks and a do-over in a nearby lot? It’s as if Norwalk Residents’ top priority is generating profit for MFD (including strategic partners).

Literally nothing in this piece presents a compelling case for letting a developer come in and do what they want. If Norwalk is willing to give MFD a tax abatement, why should the City grant it upfront?

If it won’t attract a new employer or guarantee permanent salaried jobs, why is this worth doing? How does this benefit a Norwalk resident?

What say you M.Mushak? March 13, 2019 at 1:03 pm

Of course Mike won’t answer your question Lisa. Isn’t his partner a commissioner on the RDA?

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