Share
DARIEN — Local officials touted this year’s boost in residential property values, commercial development and town assets during a recent State of the Town Address, but also noted a $100 million increase in the town’s debt load.
At the Monday Representative Town Meeting, Darien’s top Republican leaders — newly elected First Selectman Jon Zagrodzky, Board of Finance Chair Jim Palen, Board of Education Chair Jill McCammon and Planning and Zoning Commission Chair Stephen Olvany — gave attendees a glimpse into the town’s performance over the last year.
According their reports, the value of Darien’s commercial properties grew to nearly $1 billion this year and residential property values increased by an average of 28 percent. The completed construction of the new Ox Ridge Elementary School and the town’s purchase of the 60-acre Great Island were also highlighted.
Zagrodzky said the town’s progress earned them a November visit from Gov. Ned Lamont, who congratulated officials and asked how he could encourage other municipalities to follow suit.
“All these other towns — if they could take a lesson from Darien’s playbook, I think you’d actually find a lot smoother development processes,” Zagrodzky said.
But with new development came an additional $100 million of debt. Darien now has about $184.3 million in debt, an all-time high.
The majority of the boost, officials said, can be largely attributed to the $85 million purchase of Great Island and the completion of the final phase of Ox Ridge construction for about $7.5 million.
With planned renovations to three elementary schools beginning in 2024, work at Great Island, and investments in flood resiliency, Zagrodzky said the growing debt could continue to rise to at least $250 million over the next few years.
While this is the most debt the town has ever incurred, Zagrodzky reassured residents that the payments will be “smoothed out” over a long period, lessening the impact on taxes.
“It’s not something to panic about, but it’s definitely something to watch out for,” Zagrodzky said.
Palen explained to attendees that because the town has maintained a AAA credit rating – the highest-quality rating from Moody’s – it can borrow at a lower interest rate and spread the payments out over a few decades.
Over the last few years, Darien has budgeted between $9 million and $13 million to pay off its multimillion-dollar debt – less than nine percent of the total town budget. The finance chair estimated that the payments on the $100 million boost would only increase the impact to the overall budget by about 1.5 percent.
Palen recognized that planned projects over the next couple of years would continue to increase debt service, but underscored the town’s overall financial health.
“I think we’re well situated to be able to finance those, if needed by, bonding, and to do it in a way where it doesn’t force our debt service to creep up as too-high of a percentage of our overall spending,” Palen said. “We don’t want to be crowding out operating expenses because, in the end, taxes are not infinite.”
The officials said they would do all they could to keep taxes lower as it is a key reason why people move to Darien. But they also acknowledged two other important draws – schools and the town assets.
While the school board has completed construction of Ox Ridge and opened the doors last year, its contribution to the overall debt will continue by way of costly fixes to the Hindley, Holmes and Royle Elementary Schools. As they are now, the schools are without air conditioning, require renovations to classrooms, libraries, offices and parking lots and need new roofs. The project will also include removing aged portable classrooms.
The school board estimated that the renovations will cost about $86 million. But when the building committee invited contractors to bid on the project earlier this year, they were met with limited participation and high deviations from the budget, prompting them to re-bid the project in October.
According to McCammon, the building committee will review the new bids over the coming weeks and get a better understanding of the final project costs. While it is a large, costly project, the school board chair urged its importance.
“It is critical to continue to invest intelligently and proactively in our school facilities,” McCammon said.
McCammon said the district has continuously provided top-notch facilities, staff and programming to Darien families, earning them “exceptional” standardized test scores and a four-year college enrollment rate of about 94 percent for the class of 2023.
As for Great Island, Zagrodzky said the town needs to hone in on making the costly investment worthwhile.
Between the planned widening of the access road and ongoing environmental remediation on the property, the island will not open until next summer. In the meantime, Zagrodzky said officials need to think of ways to develop Great Island to be profitable – especially given that the purchase was the crux of the debt increase.
“We need to keep costs in mind. That was an $85 million acquisition – that is not a trivial amount of money,” he said. “And that is a lot to spend, so it cannot be just a cost center, in my judgment, going forward. We need to figure out a revenue component.
Photo credit: Darien TV79. You can watch the entire 2023 State of the Town Address on Darien TV79.