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DARIEN — After a discussion that included public access and zoning, the Board of Finance approved a bonding resolution for the purchase of Great Island for $103,465,000 on Wednesday night — a move that will likely lower the town’s bond rating but may have little impact, according to a municipal bond advisor.
Mark Chapman, of Munistat, told the board that although the town’s bond rating may drop a notch, from the highest at AAA to AA1, the town will continue to be able to borrow.
“It won’t affect your access [to capital]. AAA is obviously the gold standard. AA1 is still very attractive paper to investors,” he said. “Darien has been AAA for as long as it’s been part of the bond market. … and it just might be more of a psychological shock of losing that AAA, the caché of it, versus how much is this going to cost over the life of the community.”
As CT Examiner previously reported, the purchase will increase the taxes of a median-priced home in Darien — valued at $1.22 million and assessed at $854,420— by $641, totaling $14,722 for fiscal 2023.
Board Chair James Palen also projected that in five years the median home’s taxes could increase by $2,429 to $17,140, with $641 attributed to Great Island acquisition debt.
David Martin, a member of the board, said he expected the town will lose its AAA rating. He said he believed that the ongoing capital needs for the project will “likely keep debt levels and service higher than is shown in the projections” because debt will be issued or reissued.
“When we do approvals for operating budgets and capital spending in town. We question everything and we don’t approve things until we have answers. So approving a purchase of this magnitude with so many uncertainties, is a very difficult ask if you’re evaluating it purely on a financial basis,” he said.
Taylor Carter, board member, said she was concerned about approving a purchase that will increase residents’ taxes without first going to referendum.
“This, in light of what’s already an increased budget with inflation the way it is for families on a fixed income. I am very, very concerned about voting to voluntarily do this for a property they may or may not even care about,” she said.
Carter said she was torn because the economic outlook is “not favorable,” but buying the land is “an opportunity of a lifetime.” She said she shared Martin’s concerns that the costs and increase were underestimated.
“I know that our children and grandchildren will be happy to have this someday. I also hope that given that we have spent $250 to $300 million to renovate all these schools, the timing is terrible, but it’s lumpy, and hopefully things will be tough for a little while but then get better and that we’ll all look back and be happy that we hold our nose and did this because I do not like it but I will support it.”
She also said she was concerned the board was losing sight of the town’s future infrastructure needs.
“I just need to put it out there that not that long ago we were talking about flood mitigation and the need to invest. I was concerned about that because I felt like it was sort of a blank check of potentially large proportions — where do we stand on that after something like this?”
Public access delayed, zoning could expand land uses
Even though the purchase may close in August, First Selectman Monica McNally told the board that Darien residents will not have access to the property until at least March 1 because tenants on the property hold leases until the end of February.
She said the leases generate $431,000 in net revenue annually.
“We intend to put [money] aside and accumulate those funds as long as possible. So until we make [our] plans, which will be generated from our community — as well as I could see investing in a third party consultant to help us come up with some of those ideas — we would be limited in what we would do there,” she said.
Once the town develops its plans, she said her expectation was that there would not be tenants on the property.
McNally said the town will likely form a building committee to work with the community to shape the future of Great Island. “It would be a very transparent and inclusive conversation,” she said.
She estimated the town will spend about $5 million in infrastructure improvements — for example, running sewer to the property, expanding the roads and creating parking areas.
“But until we know what we’re going to do with the property, that’s an estimate,” she said.
Jeremy Ginsberg, director of planning and zoning for the town, told the board that the property is zoned residential, which allows public schools and public parks as of right. By special permit, the town could apply to build municipal buildings on the site, for example a police station, town hall, library, or fire station. The town could also apply for “town uses” like walking paths or parking areas.
“Or, [the town could apply for] social, cultural and recreational uses serving a community need or convenience and not including any activity carried out primarily for profit – that’s the section of the regulations that allows the commission to grant a special permit to, say, the YMCA, the DCA, any of the the country clubs, the Middlesex Club, et cetera,” he said.
Board member Taylor Carter asked if the town could build a restaurant on the site.
Ginsberg said it was possible if the restaurant was an accessory use, like a snack bar next to a golf course.
Last chance, preventing development
Board member Dan Bumgardner said he believed the town’s purchase of the property will prevent unwanted development of the site.
“The scarcity of undeveloped waterfront property in our area would undoubtedly generate significant interest and the potential acquisition of parcels for residential development. The town is convinced, and I have no reason to doubt, that there was and remains substantial interest from developers who would turn this parcel into 20 or more new waterfront homes,” he said.
Responding to some detractors of the purchase who voiced concerns that the purchase would divert money from education, board member Paul Hendrickson pointed out that Darien has spent between $250 and $300 million on new school construction and renovation — and that the Board of Finance approved a 3.7 percent increase in the school budget for fiscal 2023.
Hendrickson said that when his parents moved to Darien in 1962, a third of the town was undeveloped.
“Now it is only 3 percent undeveloped. This is our last best chance. It is said that you regret two things in life — the things you do, and the things you don’t do, but it is the things that you don’t do that you will regret more. That is why I will vote for the purchase of Great Island.”
The board voted 6-1 in favor of the resolution, with Martin as the opposing vote.
The Board of Selectmen approved the purchase of the 60-acre property on Monday.
The resolution is contingent upon RTM approval of the appropriation and bond authorization for the purchase. The RTM will vote on June 27.