Election clarifications: Senior Tax Relief, Workforce Housing costs, ‘tax credits’

Here’s some info inspired by comments made during this campaign cycle:

• Number of seniors getting tax relief has increased, interim Tax Assessor says
• A one-bedroom ‘affordable’ apartment rents for $1,792, less possible utility allowance
• Difference between tax abatements and tax credits

Elderly tax relief program

At the recent League of Women Voters of Norwalk Common Council at Large candidate forum in City Hall, Republican candidate Richard Bonenfant was among those criticizing the high cost of living for Norwalk seniors.

“Where’s the property tax relief for seniors who want to remain in their home? If you ever worked in your life and live on a modest pension, there’s nothing for you. You’re paying full value on your property,” he said.

The City does have an elderly tax relief program.

Interim Tax Assessor Paul Gorman, speaking at the Oct. 12 Common Council Finance & Claims Committee meeting, said the number of seniors getting tax relief grew from 600 in 2019 to 1,199 in 2021.

He attributed the jump to the maximum income allowed increasing from $70,200 to $72,320. “That brought a lot more people into the program,” he said.

This represented an additional $500,000 in reduced revenue to the City, Gorman said.

In 2022, the maximum income increased to $76,500, but the number of participants dropped, according to Gorman’s spreadsheets.

His stats show:

State program benefits:

• 2019: Maximum income $45,100
• 2020: Maximum income $45,800
• 2021: Maximum income $46,400
• 2022: Maximum income $49,100

Total state participants:

• 2019: 401
• 2020: 390
• 2021: 766
• 2022: 715

Total state benefits:

• 2019: $243,706
• 2020: $231,706
• 2021: $460,065
• 2022: $418,679

Norwalk Tier I, maximum tax relief $1,500

• 2019: Maximum income $57,000
• 2020: Maximum income $57,900
• 2021: Maximum income $58,700
• 2022: Maximum income $62,100

Norwalk Tier II, maximum tax relief $900

• 2019: Maximum income $70,200
• 2020: Maximum income $71,300
• 2021: Maximum income $72,300
• 2022: Maximum income $76,500

Total local participants

• 2019: 600
• 2020: 605
• 2021: 1,199
• 2022: 1,139

Total Norwalk tax relief:

• 2020-21: $1,057,343
• 2021-22: $1,044,189
• 2022-23: $1,556,642
• 2023-24: $1,554,325

Republican Council at Large candidate Glenn Iannacone also remarked on senior tax relief.

“I think taxes are crazy in the city,” he said. “My taxes went up $1,000 this year. For elderly people, you know, you’re going to get to the point where you won’t be able to afford the taxes anymore.”

Affordable housing?

“We have all this supposed ‘workforce-affordable housing,’ but if you look at the price tags on these rental units, you know, $2,000 and up for a one-bedroom unit, your per unit costs, and many of them are built at a cost of $600,000,” Independent Common Council at Large candidate Jo Bennet said in the League of Women Voters forum. “So of course, the developers, they need to get their money back.”

The high cost per apartment refers to developments receiving federal Low Income Housing Tax Credits (LIHTC), which come with legally mandated building standards.

In 2018, Architect Steve Schoch, who worked on Wall Street Place, said, “Affordable housing funded in this way is some of the highest-quality construction that you are going to find because in addition to what everybody else has to do for the building codes, there are additional higher performance standards that are set by every state… It is very far from the truth that affordable housing is cheap housing. It’s actually more expensive to build. It’s only affordable to rent.”

In Norwalk, the unbuilt Wall Street Place mixed use development has LIHTC in its funding stack, as did Soundview Landing and Colonial Village.

As for the rents, Norwalk Senior Planner Michelle Andrzejewski recently explained:

“Currently, all the workforce housing unit stock are restricted to 80% of the State Median Income Level. The 2023 numbers provided below are adjusted by household size based on the state’s guidance assuming 1.5 persons per bedroom. Tenants also may pay less based on utility allowances.

“Maximum rents allowed:

• “$1,673 for a studio
• “$1,792 for a one bedroom
• “$2,151 for a two bedroom
• “$2,485 for a three bedroom”

An applicant’s gross income is used for qualification.

This reporter lives in workforce housing. The $1,792 rent is reduced by a $240 utility allowance, making the amount due monthly $1,552.

That’s up from the $1,142 base rent in 2019.

A “one-time fee” of $250 for two pets was initially charged; new management requires a “nonrefundable deposit” of $600 for each pet. The pet fee per month was initially $25 each; new management charges $60 per pet.

Apartments.com shows that the market rate rent for a one-bedroom apartment at The Curb is about $2,260. A 760-square foot one bedroom apartment The Confluence at Norwalk is $2,675 and a 755 square foot apartment at the Brim and Crown is $2,255 to $2,310.

That tax credit issue again

Lisa Brinton, Chair of the Independent Party Norwalk Town Committee, submitted a letter to the editor urging more political diversity in local government.

“Single political party rule has concentrated power. Accountability and transparency have fallen by the wayside,” she said.

The main issue is affordability and quality of life, she said.

“Residents are concerned about aging infrastructure and generating enough tax revenue to pay the bills. Unfortunately, years of developer tax credits will be followed with more projects stretching from MLK Drive to Route 1,” she wrote.

In 2019, when Brinton was running for Mayor, NoN looked at this issue, posting a story explaining the difference between tax credits and tax abatement. 

Tax abatements

• Enterprise Zone tax abatements are awarded as of right. City officials are obligated to provide the benefit, due to an ordinance first approved in 1982. Originally effecting part of South Norwalk, the zone was expanded to include the West Avenue corridor in 2020.
• Tax abatements reduce the taxes owed only on the part of the property that’s been improved. Although developers pay less than they would on the improved portion, the City still receives more in taxes than it did before the improvements were made. The abatements expire on a sliding scale, with more taxes due each year until the developer no longer gets a break.

Tax credits

• Tax credits, on the other hand, are awarded on a case-by-case basis.
• Tax credits are federal and don’t involve City money or State funds. They can be sold to finance a project.
• Recent recipients include the Wall Street Theater and Soundview Landing, the Washington Village replacement. Wall Street Place is slated to receive Low Income Housing Tax Credits (LIHTC), should the 100% affordable housing complex be built. LIHTC were also mentioned as part of the Colonial Village funding stack.