Norwalk leaders: Al Madany settlement impact should be minimal

Common Council Finance Committee Chairman Bruce Kimmel (D-At Large) studies financial figures recently.
Common Council Finance Committee Chairman Bruce Kimmel (D-At Large) studies financial figures recently.

NORWALK, Conn. – The burden to the average Norwalk taxpayer brought about by the settlement of the Al Madany Islamic Center suit will not be great, even if the entire weight of the payout is added to next year’s tax bill.

According to city finance officials, the impact could, for the majority of taxpayers, be held to double digits – if that.

The Common Council unanimously voted Tuesday to approve a suit settlement to the tune of $2 million. This includes buying Al Madany’s property at 127 Fillow St., paying the expenses, but not fees, of Al Madany’s lawyers, damages, and a contribution toward development costs at another location.

Mayor Harry Rilling and Corporation Counsel Mario Coppola confer during a recent Common Council recess.
Mayor Harry Rilling and Corporation Counsel Mario Coppola confer during a recent Common Council recess.

“The reaction is mostly positive, but some people are disappointed at the amount and the fact this could set a precedent,” Mayor Harry Rilling said in an email. “Some do not realize how important it was to cap our potential liability.”

Rilling explained, “In Federal court cases, settlement discussions are a mandatory part of the process, so we had no choice but to engage. Our maximum liability in this issue is now just over $1 million. Had we continued to fight the case and lose, our exposure could have been as high as $10- to $20 million. With information known to a very few, the likelihood of us losing was significant,” he said without revealing that information. “We felt it was necessary to protect the taxpayers from a huge financial liability. We are now out from under this federal lawsuit and we have protected, as best as possible, the taxpayers. We struggled over this issue for many hours and had a few alternatives from which to choose. We believe this solution was in the best interest of the community.  Gambling with our taxpayers’ dollars was not something we wanted to do.”

In response to a NancyOnNorwalk inquiry, Director of Management and Budgets Bob Barron explained the nuts and bolts of the tax dollar situation, starting with the assumption that the $307,500 being paid to Al Madany to cover the lawyer’s expenses is paid by the Connecticut Interlocal Risk Management Agency (CIRMA) at no additional cost to the city, and the assumption that the $585,000 spent to acquire the property would be recovered by selling it.

“The net unreimbursed expense to the city is $1.1 million. If this $1,140,000 was added to this fiscal year 2014-15 operating budget, it would have increased the average mill rate by 0.098184845 and the cost to the $257,600 median assessed single family home in the Fourth Taxing District this year would be $25.29,” Barron wrote.

However, there’s no reason to assume that the $1.1 million will be added to next year’s operating budget.

While Finance Committee Chairman Bruce Kimmel (D-At Large) said Wednesday that it would be hard to tell how much of a hit taxpayers will face in a speculative question, he pledged that he would like for it not to hurt at all.

The city had set aside $1 million for the lawsuit to begin with, figuring it would probably be used for legal expenses, he said.

“My feeling is preliminary, that perhaps our fund balance could absorb that hit,” Kimmel said. “We have to look to see if there are any spikes in our operating budget… but revenues have been up, we’ve been running surpluses. Again, this is speculative, but I have a feeling that our fund balance is generally above our benchmark. I’m not sure, but that’s the first question I would ask.”

If the fund balance is at 15 percent, the settlement money could be taken from that source, he said.

“I would like to make sure that we minimize the effect of the settlement on property taxes,” Kimmel said. “The reason is we just went through a re-val, so I think it is extremely important that we minimize the impact of this settlement on property taxes. If that means looking at our fund balance (that’s what we’ll do.)”

Finance Director Thomas Hamilton
Finance Director Thomas Hamilton

Finance Director Thomas Hamilton echoed these sentiments.

“I am still reviewing the terms of the settlement and will be developing a recommendation for the mayor on how best to cover the costs of this settlement,” Hamilton wrote. “It is premature for me to comment on precisely how these costs will be accommodated.  It is my understanding that the city’s insurance carrier (CIRMA) will be contributing $307,500 toward the cost of the settlement, and that $585,000 of the costs will be used to acquire a new capital asset (the land and building), representing the fair market value of the property.  The remaining costs will likely be charged to the city’s Insurance Fund, and as I said, we will need to determine how best to ensure that the Insurance Fund remains in a sound financial position over the long term. I am not prepared to offer a recommendation today, but we will develop a plan that keeps the Insurance Fund properly funded, while mitigating the impact on operations.  I would also note that a settlement such as this is a one-time cost; it does not represent a recurring expense.”

He compared the settlement to the Board of Education situation in 2012, when the city’s insurance fund was used to cover a $4 million deficit uncovered in the BoE’s insurance accounts. Although the board was expected to pay this back over three years, it was actually repaid in two fiscal years.

“We will endeavor to limit the impact of this settlement on both services and taxes, and there is no need to rush into a decision,” Hamilton wrote.

The city has agreed as part of the settlement to commit three years to helping Al Madany find a new property. Some commenters suggest that the Main Avenue location coveted by BJ’s Wholesale Club would be a good spot.

Rilling said back in June that a developer was eying it as a possible site for an assisted living center, but on Wednesday he said, “No movement on any potential buyer for the property on Main Avenue, although I’m sure there will be some discussion in the near future.”


36 responses to “Norwalk leaders: Al Madany settlement impact should be minimal”

  1. anon

    Precedent setting ≠ capping potential liability

    “…some people are disappointed at the amount and the fact this could set a precedent,” Mayor Harry Rilling said …. “Some do not realize how important it was to cap our potential liability.”

    Rilling and Cappola capitulated with a premature settlement.

    Spinmeister as you will, this WILL impact taxes and it will impact services with no taxpayer gain.

  2. Aga Khan

    @anon you missed the pertinent part of Rilling’s statement: “With information known to a very few, the likelihood of us losing was significant,” he said without revealing that information.”
    You may think he is posturing, but I can assure you after studying this case for years that the City did the right thing for taxpayers. The mosque’s board and especially It’s spokesperson Farhan Memon need to be commended for exercising moderation. They had every ability to press on and exact a high toll from the City.

  3. Screwed Taxpayer

    $25.29. That sounds like a good start for a donation to Rilling’s opponent next fall. If the entire city were to match this we would see what “minimal” impact $2 million would have for a mayoral campaign to get real leaders.

  4. DeeeeMoooo

    @anon: “no taxpayer gain”?

    There’s a very vocal group of West Norwalkers who would disagree with you. Those taxpayers got exactly what they wanted, as did a very vocal group of commenters on this site.

    Nonetheless the precedent is troubling as there are scores of “neighborhoods” in Norwalk besides West Norwalk, and I expect none will hesitate now to look to the city for a cash bailout when large development considers moving to their end of the city. Zoning regulations need to be updated yesterday to keep it from happening again, and I haven’t seen any news on who is making that happen.

  5. Al Bore

    Norwalk Mayor and council did what they had to do based on the residents who spoke loud and clear. We are very unfortunate to have such an inept zoning board and we need to overhaul both our zoning laws and our zoning commissioners. I think the settlement was good since this could have ruined the neighborhood with such a large structure that would be so out of character to the residential community and adversely affect their property values. I think we need to be sure this does not happen in the future and the residents must push for change, as we saw the zoning board couldn’t care less about the neighborhood and the community. We need good planning and zoning people who are willing to make tough decisions and not take the easy way out by being cowards. This was a no brainer too big for the property and way out of character for the neighborhood. The community spoke to the zoning board and they ignored us. Thank you Mayor Rilling and council members for cleaning up after the zoning board and please now let’s clean out the zoning board.

  6. Taxpayer Fatigue

    Unfortunately, P&Z is only answerable to the Zoning Commission, which is headed by the person who promoted the current director into his job over 20 years ago. The Zoning Commission as led by Joe Santo and Emily Wilson, aren’t going to do anything (and we certainly don’t want them to because they are the ones who got us to here in the first place). The only way the City can do anything about P&Z is to cut off their funding. The department needs to be dismantled and then built back after there is new leadership on the Zoning Commission, which won’t happen until after July 2015. But, the BET, the Mayor and the Council all have strong input into the departmental budgets, with the BET having the last word. They should cut their $1.9M budget at least in half, if not more. This would also give us the money to pay for the settlement without going into our rainy day funds.

  7. Bill

    @Aga Khan, if Farhan Memon had “exacted a high toll”, I am certain taxpayers would have exacted a high toll on the group gouging taxpayers too. Lose lose for everyone. Not something to boast about. This turns neighbors into enemies…sad really.

  8. EveT

    One imagines Santo, Wilson and other zoning commissioners breathing a sigh of relief and thinking, “thank goodness that’s over, now we can go back to business as usual.” Public pressure will need to be strong and constant if anything is going to change for the better.

  9. OhNoNorwalk

    Why is this Great Loss of our Tax money sugar coated by the city. The Axe should come down on the Incompetent persons that caused this financial loss. If the Mayor is not part of the solution then he is part of the problem. Why are theses people who manage and Board members being protected by the Mayor. Do your job Mayor or get out of the way. Is it election time yet. !!!

  10. Carol

    if the tax impact is expected to be so minimal let it come out of the mayors and council members pockets not ours!!!also zoning.

  11. DeeeeMoooo

    To @OhNoNorwalk and others anxious to use this as a WMD against the mayor:
    The problem is and has always been the zoning regulations that are on the books, and in this case you can add in, as an exacerbation of the problem, the handling of this case by zoning. At the foundation of the mosque’s case is the zoning regulations.
    So give it a rest: the mayor isn’t in the way of anything, and he doesn’t have the power to unilaterally change the zoning regulations. BTW the last mayor didn’t do much to resolve the issue and, for better or worse, it’s now resolved so stop pretending like the city has accomplished nothing. The city was between a rock and a hard place and Rilling didn’t put us there.
    What you *ought* to do, instead of looking for lame opportunities to turn this into some problem with the mayor, is call your councilpersons and organize, like West Norwalk did, to push for immediate changes to zoning regulations.

  12. Scott

    The dollar amount steel feels like extortion. Are these real world numbers for their expenses? Can we see receipts or something for validation. Most people would say that sounds like they (the litigants) hit the lottery. I know this was the cheaper route for the city but exactly what restraint did Al Madany use? This is money from the residents of Norwalk that pay taxes, not an individual that may or may not have “discriminated” against the group. We are not a for profit private corporation. We are the public. The People.

  13. piberman

    Lets see if we can agree on the facts here. Al Madany’s application for a Mosque was rejected by the zoning board and that decision was supported in state court. Reportedly that’s a unique experience for a religious organization here in Norwalk. Ordinarily organizations and their attorneys submitting “community sensitive” zoning applications bend over backwards to meet with relevant community groups and individuals, discuss their plans in detail, attempt to ameliorate neighborhood concerns and then submit plans fully expecting zoning approval. That’s what the attorneys are expected to do – obtain zoning approval for their clients. Presumably the attorney’s hired by Al Madany were knowledgeable about the importance of meeting and discussing the plans with the neighborhood, ameliorating concerns expressed and fully knowledgeable about the City’s zoning regulations. Presumably they were hired to secure application acceptance by the zoning authorities. They failed to win acceptance. Blaming the zoning code for the failure amidst a long history of acceptances by relgious orgnizations previously seems inappropriate.

    What might have been done differently after the application rejection ? Al Madany’s legal team might have redone their efforts to again meet with the neighborhood with new revised plans that did have every expectation of meeting the zoning board’s criteria. After all the tradition in Norwalk is that religious organizations seek clear and positive support from the neighborhood before erecting a new structure. Instead, having been rejected initially Al Madany went to state court, then federal court where they claimed “discrimination” and the rest is history.

    Rather than criticize the City’s zoning codes we might well ask why Al Madany’s legal team didn’t do their homework and secure acceptance of a suitable application before the zoning commission the first time around ? Or present a suitable alternative when rejected ? That’s what they presumably were hired to do. Secure acceptance. And, customarily that requires extensive meetings with the neighborhood about the proposed facility, informal meetings with City staff and extensive knowledge of the City’s zoning codes and regulations.

    Perhaps with a different set of long experienced attorneys Al Madany would have had a more successful outcome without litigation. I’d like to think so. At day’s end when a religious organization involves the City in extended litigation and settlements its “not a proud day for Norwalk”. Finally, approval of zoning applications by religious organizations in the past reportedly has not been “automatic”. There have been “back and forth” discussions after the initial application was submitted in order to obtain approval. Again, the question is why Al Madany’s legal team pursued a different course of action – litigation. Having been denied the first time around they had ample opportunity to seek approval on future applications. They chose litigation.

  14. Deesgusted

    Can you please explain to me what “Damages” he suffered, if I am correct, it was Al Madany who chose the location, and pursued this, knowing well in advance he would have to be subject to the scrutiny all of us are subject to, when purchasing properties, So what damages other than the damages we all face when dealing with P&Z, is he dealing with, that should warrant this type of compensation. I personally think theres much more to this than meets the eye. In addition, this does not set a good example for those who find cracks in the system, I wonder if I were to propose the same thing to the City of Norwalk, if those same guildelines would apply to me, this paves the way for anyone to become rich quick, find a location that is not suitable for your structure, and hire a lawyer, and whala, you just won the lottery! Furthermore, I resent haveing to pay for something, even if it is a nickel for dare I say the word, but, gosh darnit, the use of that property was plain and simple, NOT SUITABLE FOR A MOSQUE,NOT EVEN A CHURCH, period. I will regretfully, now find a way to abandon my once fond memories of the City I grew up in, I refuse to pay on the grounds of feeling like this city allowed this type of bullying to happen. And although I know, we settled in the best interest of the city, taking the lesser of two evils, it’s a reminder of how the City has been operating, Seems lately everyone has their hands in the pot!

  15. Lisa Thomson

    I agree with DeeeMooo – The buck stops with the Common Council. Not having a central planning group has worked well for developers and council people supporting or defending their pet projects. It is by design that residents find out about most developments AFTER the fact. I encourage everyone who reads this blog to write your council person and demand that they make cleaning up P&Z a priority. It is for the mayor, as indicated in his State of the City Address – so too it must be for the council, which purportedly represents the residents – who incidentally FUND 89% of the city – not the double speak lawyers and developers.

  16. Scott

    Deesgusted it’s simple. Get your friends to be your congregation, declare the name of your new religion, get a tax exempt ID and then shake the city money tree and see what drops. I’m considering it . I’ll call it The Church of the Great Debate because I enjoy it so much

  17. Deesgusted

    Dear Scott,

    Ms Debbie Troy stole a good portion, Malady is working on the rest, whats left to shake? Oh yeah our taxes..

    I’m still shaking my head about Debbie Troy stealing from the City and getting a simple AR, and using her so called cancer as a ploy to get her co-workers to give her more money to support her greed, and now Al Malady, adds insult to injury, what are they breathing at City Hall, Angel Dust?

  18. Scott

    The Islamic Center may have played within the rules that are the laws (which we all can do) but it doesn’t make the results any less of a giant bitter pill that everyone has to swallow.

  19. Dennis DiManis

    Vote against everyone involved.

  20. Lisa Thomson

    To several of the posters: Your anger is misdirected at the Mosque folks- look to your Common Council and P&Z Board of Norwalk and their years of turning a blind eye to unrestricted development in the neighborhoods. The urban core and thoughtful city planning languished, while developers got extensions and residential neighbor fought neighbor, until exhaustion set in.
    Rowayton may be the next neighborhood with a lawsuit directed at the city, if it allows building on the Farm Creek Peninsula @ 2 Nearwater Road.
    Lifetime politicos love it when xenophobia, NIMBY-ism or whatever you want to call it sets in – because it distracts the taxpaying homeowners and allows the politicians to horse-trade development favors.
    Stop the cronyism. Stop the madness.

  21. Scott

    Lisa if you choosr the same route to extort taxpayer money from the city then you’re no better.

  22. Very Concerned

    Zoning personnel should have their salaries cut 20% immediately to fund the cost for this mess.

    Norwalk taxpayers should not pay the bill.

    As a Norwalk resident, I cannot allow these outrageous salaries to be paid. Also the benefit packages.

    Have you seen the salaries and raises online? This is public information you know.

  23. Very Concerned

    585K is outrageous.

    Maybe there is 1.5 acres in total. However, a chunk of this property is a big ditch in the back of the house on 127 Fillow.

  24. sofaman

    Norwalk got off easy.

    Thank you Mr. Memon for taking the high road.

    There should be no more wonder of what the cost of xenophobia is. The bill has arrived.

  25. Lisa Thomson

    @Scott – We are those taxpayers. What do you suggest the neighborhoods do to get the attention of our City employees and politicians?
    Perhaps one of the best takeaways from all of this mosque business was the awareness it created regarding unrestricted Floor Area Ratios (FAR) in the zoning code – explaining in part the McMansions that we see on our side of town. Supposedly, size (and) traffic was the issue for West Norwalkers…or was it?
    If the city allows a McMansion to be built on a trolley line, in the middle of a tidal creek – due to outdated zoning regulations, why wouldn’t we challenge it while the mosque debacle is so fresh in everyone’s minds. The precedent has been set.
    Alternatively, the city could do the right thing and make the owner of the property build on the road like everybody else in the Farm Creek area or perhaps the city will offer to buy the land until it’s code catches up with the 21st Century.
    It will be very interesting to see how the city handles the situation.

  26. jlightfield

    @Lisa Thomson, let’s be clear about the farm creek issue. There is a cottage of somewhere near 1200 sqft on the property. It is a single story. Property owners have the right to replace their buildings as long as they comply with current zoning regulations. Buildings in the flood plain now require a 12ft elevation at zero grade to comply with FEMA regulations. Current zoning regulations allow for residential houses to be restricted height based on ground elevation. It’s a complicated calculation but essentially it allows for two stories, or 50 something feet (more or less).
    Certain parts of Norwalk have a unique neighborhood characteristic where the houses sit close together and have essentially a village look. Farm Creek is one of them. Pine Point is another one them.
    So, just to be crystal clear, are you advocating that a zoning regulation now prohibit two story, FEMA stilts and decrease the lot coverage? Because one good storm knocking out 90% of the homes along Farm Creek would be unable to be fixed or rebuilt.
    This is exactly what happened to Harborview, and there’s a lot of anger there about how that changed the look and feel of that neighborhood.
    I think, btw, that we should be talking about what it means to have waterfront communities and what should be the way in which we preserve waterfront access and the look and feel of charming villages. A good direction would be to develop a master plan for Rowayton that goes beyond what the Village District designation covered.
    And maybe in the short term Pine Point and Farm Creek can engage in a dialog of what to do with replacing a small cottage on a waterfront parcel should look like.

  27. Scott

    Lisa i can understand the need for leverage when fighting what feels like a losing battle. I’d like to believe that you would not collect on the threat of litigation but simply use it as a tool.

  28. Lisa Thomson

    @jackie this is a unique and extraordinary property (on a trolley line in the middle of the water) that has had a benign ramshackle structure on it from 1949…or whatever. It has been unoccupied for decades. How it ever got there in the first place is another matter of speculation. No doubt cronyism was alive and well in Norwalk back then. However, it has no place in 2014. I don’t understand the code or the loopholes well enough to comment on the implications for other homes along the waterfront or what happened to Harbor View. But I do know this, some properties are so unique and extraordinary as to impact the heart and soul a town’s character and this is one of them. Public opinion is as strong in Rowayton about this property as the Fillow Street property was to West Norwalk residents. According to Norwalk zoning code…both structures in each of these neighborhoods would be allowed. The difference was one group of people were Muslim and one is a prominent developer in town. Regardless of the code, politics drives planning and zoning in this town. Will the city respond to Rowayton’s cries for help on this zoning matter as they did West Norwalk or will we be thrown under the bus. Only time will tell.

  29. Mr. Ludlow

    Setback requirements, limits on the number of stories and height restrictions control the size of homes. Not wanting to be the one to impede good old-fashioned class warfare to one wailing about “McMansions”, but arguing about FAR is a red herring.

    If you want to reform the zoning code, look to the overcrowded neighborhoods in Norwalk where multi-family dwellings have resulted in more and more cars being parked on the streets. Streets become tough to navigate and snow removal less efficient– all of which contribute to dangerous conditions. Let’s spend some time worrying about the folks who take their lives into their hands every time they back out of their driveways. Let’s try to help the families who can’t let their kids walk in their own neighborhoods because of unsafe traffic congestion (caused by overbuilding).

    If you don’t like what you see in Farm Creek or on the fabled and toney Nearwater Avenue, turn to “your” Commissioners for a solution.

    But please, don’t raise my taxes anymore to “preserve” Norwalk’s more affluent neighborhoods at our expense.

  30. Suzanne

    I resent the implication that the objections to the mosque were a result of NIMBYism or xenophobia. Nothing could be further from the truth. It has been elucidated enough on these threads but, to be very, very clear, neither of those objectionable terms had anything to do with it.

  31. Lisa Thomson

    Mr lLudlow – bad zoning is bad zoning. And I agree with you about over congested neighborhoods and the impact to the street congestion in Norwalk … But consistency is lacking in P&Z and cronyism reigns large. Attempts to turn Farm Creek into a class warfare argument only serves to leave Norwalk’s zoning issues unchanged politicians complacent.

  32. Lisa Thomson

    @Suzanne, In previous threads, I refer to the FAR overdevelopment and street congestion with regard to the mosque which was the basis of the West Norwalk argument. Sadly, there were anonymous xenophobic comments made (not by you) on this blog and it is unfortunate, as it distracts from the real issues in P &Z which point to reform of the code, processes and by some – personnel. The NIMBYism that I referred to was in reference to our own dispute here in Rowayton with regard to Farm Creek.
    Mr. Ludlow just posted some ‘class warfare’ comments about toney neighborhoods at taxpayer expense. I will reiterate, so long as neighbor fights against neighbor or neighborhood fights against neighborhood – Norwalk’s code will remain out of date and politicians will remain complacent about fixing it.
    I believe there are ~ 1600 Rowayton households out of ~ 42,000 properties in Norwalk and our tax contribution to the city factors in ~18% of the city even tho we make up less than 4% of the households. Bottom line, when the city does stupid P&Z stuff because of outdated zoning code or whatever, we pay.
    BJs was halted, the would be mosque land purchased – and what of Farm Creek? That’s all I am saying.

  33. piberman

    It’s unclear what “lessons” are to be learned from the Mosque controversy. Zoning regulations in Norwalk as elsewhere will always be “incomplete” so blaming the zoning regulations as the “causal agent” seems premature. Perhaps the lesson to be learned is that when seemingly difficult or contentious zoning applications are made City officials need get involved informally to secure an agreeable outcome. Of course, if an applicant is determined to not yield then litigation cannot be prevented. Reportedly this is the first time in CT that a religious group sought relief in Federal Court. That in and of itself ought to give some pause for serious reflection rather than a quick pointing of fingers. The stigma of discrimination suit filed in Federal Court is not apt to be easily forgotten. One would have thought that all parties involved would have moved “heaven and earth” to avoid such a contentious outcome. Rather than a “proud day for Norwalk” it might be better to declare “a day for reflection”.

  34. anon

    Spot on @Berman

  35. EveT

    Perhaps the most important takeaway is that we the Norwalk taxpayers should NOT let this headline come true: “Al Madany settlement impact should be minimal” — meaning that there should be a strong impact on P&Z, Planning Commission, Zoning Commission, Common Council, mayor’s office, etc. such that they will clean up the mistakes we’ve all been writing about here. If we just vent online and don’t organize, it will be business as usual.
    I know the comment in the headline about “minimal” impact refers to tax dollars. We need to turn it around and make it refer to curing the ills of P&Z.

  36. Suzanne

    There will always be the few who are part of the pendulum swing we do not like. That comments were made claiming NIMBY or xenophobia was part of that swing. The vast majority of neighbors and citizens reflected their concerns based upon Zoning issues. Those who had negative comments regarding Al Madany or Muslims are in the minority and while they are allowed their opinions, they do not represent most comments on this and other threads. I just think it is important to recognize this as Norwalk as a diverse community spoke, more thoughtfully than those that denigrated a particular group.

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