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STONINGTON — A referendum on Tuesday to stop a previously approved tax abatement for an affordable housing project in Pawcatuck has exposed financial and social rifts in the community that extend into town politics.
At the Aug. 9 town meeting, residents approved by voice vote a $690,748 tax abatement over 10 years for WinnDevelopment, an affordable housing developer that has proposed the construction of 82 apartments — including 65 affordable units— on the long vacant Campbell Grain property, a 1.89-acre parcel at 15 Coggswell St. and 27 W. Broad St.
According to the agreement, WinnDevelopment will pay $695,000 in taxes during the 10-year period. The property, owned by Frank DiCiantis of Powhaten, Virginia, currently pays $3,000 in taxes annually.
Tracy Swain, of Pawcatuck, told CT Examiner that residents were asking “loads of financial questions and nobody was answering,” during the Aug. 9 town meeting. Swain said that she made a motion to put the question to a referendum, but Ted Ladwig, who moderated the meeting, told her she was out of order. The exchange is not recorded in the meeting minutes.
Swain said that the town did not check voters’ identification before or after the tally. She said that the vote was correctly counted as 71 in favor, but only 36 people were counted as opposing even though she heard people counting off numbers into the low 50s .
Afterwards, Swain said she spoke to an attorney who told her the only option to overturn the vote was to initiate a petition to force a referendum.
“So I went to some neighbors who were also against what happened at the meeting. Four people ended up being 12 people who were going around getting signatures — we got over 300 in 10 days,” she said.
She said she has more than 100 residents helping get the message out to vote “yes,” which will reject the proposed fixed assessment. A “no” vote will preserve the tax plan as approved at the August town meeting.
WinnDevelopment has estimated the project costs at $32.6 million, including $22.6 million is construction costs and $10 million for acquisition, design, administration, financing, and marketing costs. At the full project cost, each apartment comes to $390,560. A spokesman for the company said the developer uses the construction cost as the denominator, lowering the price per apartment to $276,585.
The company develops and manages mixed-income communities. It owns about 100 properties in 11 states and the District of Columbia, including 8 in Connecticut.
According to a document on the town website, WinnDevelopment can finance about 20 percent of the $32.6 million project with a traditional mortgage using rental revenues as cash flow, and approximately 5 percent of the total cost can be financed with “developer resources and energy rebates.”
To finance the remaining 75 percent, WinnDevelopment will apply for a $20 million grant from the Connecticut Housing Financing Authority as well as the Small Cities Community Development Block Grant, or CDBG, and the Connecticut Department of Housing FLEX fund. A spokesman for the company as well as town officials have said that if the company does not receive the $20 million grant, the proposal will likely be abandoned.
WinnDevelopment commissioned an analysis by Goman + York on August 31 that found the development would be “a net fiscal benefit for the Town of Stonington, producing more tax revenue (and users fees) than expenditures during (and after) the 10-year tax fixing agreement.”
“Once certified for occupancy, this needed affordable housing community will have a net positive impact for the Town of $112,520 per year during the 10-year fixed tax agreement and a net positive of $181,573 once the agreement expires,” which included a cost to government services of about $39,000 per year, wrote a spokesman for WinnDevelopment.
The analysis concluded that the development would not generate any new cost in the public schools “due to the continued decline in school enrollments in Stonington, which has seen a 19% decline in citizens under age 18 in the past decade.”
But Swain said was concerned about the financial fairness of the project as well as the impact on town infrastructure, schools and emergency services.
“Financially we are giving money to the developer in this proposal so they could seek state grants for the funding. There were questions — what is the town getting in return? And the answer is nothing, and that’s lopsided. We’re going to give you a large financial chunk of change for nothing,” she said.
Perceptions of the proposal
First Selectman Danielle Chesebrough told CT Examiner that the fixed tax agreement is critical to Stonington’s ability to compete for the state’s affordable housing funds. The abatement would show that the town has a financial investment in the project, which would increase WinnDevelopment’s grant application score.
She said that WinnDevelopment asked the town to hold a town meeting for a tax abatement plan last year, but the town decided to wait because of COVID. She said the company proceeded to apply for state funding without the tax abatement in place and was denied.
“I believe the feedback that they got was largely based on the fact that they were lacking a 5 percent local match, and they should reapply once they got the local match. We do know it’s a very competitive system and that towns and cities all across the state are competing for this,” she said.
Chesebrough acknowledged that some of the townspeople have questioned why WinnDevelopment, as a successful affordable housing developer, needed to apply for local, state and federal dollars.
“I think the only thing we have to say is this is a whole system at the state and federal level, and residents probably can and should engage with their representatives to better understand why it’s set up this way and take a deeper look at this. But for the time being, this is the system that we have to work in and it’s highly competitive. If we don’t go after this money and get this project, the money is just going to another town or city,” she said.
The town needed more affordable housing and that the parcel had been vacant for over a decade — WinnDevelopment was the only group to come forward with a solution for both issues, Chesebrough said.
“The way we’re looking at it is we’re going to get $695,000 over 10 years versus the $30,000 that we’re currently taxing the property owner, and achieving all these other goals for us. So it seems to many of us that it’s a really, really great project and it’s unfortunate that some of the negatives have really taken hold of the argument,” she said.
Leslie Driscoll, a member of the town Architectural Design Review Board, told CT Examiner she is against Campbell Grain project because it does not fit into the architectural vernacular of the town.
“It’s way too big. It doesn’t fit into the town. I’m against these developers doing things that make us look like any other urban center. [The project] is South Boston, it’s not coastal Connecticut. The architectural design is wrong and the site choice is wrong,” she said.
Driscoll said that phase two of Brookside Village, an 8-30g project at 111 South Broad St. (Route 1) that will have 130 market rate and affordable apartments — designed by Azzinaro Architects Associates — was in keeping with the town aesthetics.
“I approved that, even though it’s tall, but it looks so much better,” she said.
Dave Hammond, chair of the Economic Development Commission, said marketing the Campbell Grain site to investors has been difficult and that WinnDevelopment was the only investor to show serious interest.
There have also been questions in the community about whether the town approached the corporation or vice versa, but Hammond said the role of the Economic Development Commission was to reach out to potential investors willing to invest in the community, whether in a vacant building or open land.
“I think that the definition of an Economic Development Commission is to ‘unstick’ if you will, ‘stuck’ properties,” he said. “One of the EDC’s primary functions is to find interested investors and developers so that we can grow the grand list not on the backs of the average taxpayer as expenses continue to go up and up. If we don’t attract new investment that means that, you know, Joe homeowner asked to pay more in taxes to cover the expenses.”
Hammond said the town was funded by 80 percent residential and 20 percent commercial. He said the commission’s revitalization strategy for downtown Pawcatuck was to have more people living downtown who would support downtown businesses — sending a broader, positive message to investors.
“If we get an investment like this one in downtown, it gives a signal to the investor community, that we’re open for business and that there’s things happening in Pawcatuck and Stonington. It lessens the risk to the investor if they say, ‘It looks like things are happening, now I might take a look also.’”
Deeper issues
Beyond the financial implications of the project, Swain said conversation leading up to the referendum has centered on the ill treatment of citizens at town meetings and how to make officials listen.
“Ten years ago a lot of citizens attended town meetings but today nobody goes. Why? Because of the way citizens have been treated when they voice their opinion, they are treated so inappropriately,” said Swain. “People before were listened to. The people running the boards would listen to their concerns, their issues, would meet you halfway,” she said.
Swain said the petition was the only way to challenge First Selectman Danielle Chesebrough, Selectman June Strunk and Selectman Deborah Downey, who are all running unopposed in November.
“Residents have been ignored by town hall because they’re giving attention to a multimillion corporation that’s from out of state. Town people are tired of what has been happening. We have no other option but to challenge town board members, we can’t vote them out of office.”
Swain compared the support on social media for defeating the WinnDevelopment project to the groundswell against the Smiler’s Wharf proposal that would have added hundreds of apartments along the harbor in Mystic.
“Smiler’s Wharf was a massive thing — it was too big, too impulsive, too much traffic, and everyone rallied around. We have more than 100 people helping with “vote yes” in the referendum — extremely far left and extremely far right, this has brought people together. There is no red or blue in any of this, it’s a matter of people saying no.”
Chesebrough acknowledged that some of the opposition was related to other issues and she encouraged voters to research the facts about the project. .
“I think understanding that people who are advocating for it aren’t pushing it for some ulterior motive — it’s just a very long vacant property that was a major priority for the past administration and the current administration. We brought a solution to the table and people will be able to have their say — so democracy is working I guess in a good way. We hope people come out and vote and take the time to really understand the facts.”
The referendum will be held on Oct. 5 from 6 a.m. to 8 p.m. For more information, click here.