$3.4M Land Deal Rescues Budget

by Melissa Bailey | May 19, 2009 7:25 AM | | Comments (15)

IMG_3279.jpgAldermen approved a plan to plug a budget hole with one-time revenues by selling $3.4 million in land and land rights to Yale University.

The deal includes the sale of a parking lot at 156 Washington Ave. for between $3 million and $3.35 million, and the 99-year lease of the downtown Begonia Island (pictured in foreground) and Market Island (in background) for $400,000 in the first year.

Both deals passed by a unanimous vote at the Board of Aldermen’s monthly meeting Monday.

The approval came in time to fill a gap in the current fiscal year budget.

The sales will address a remaining $4 million gap in the budget year that ends on June 30, according to Larry Rusconi, the city budget director. About $3 million came from tax appeals spurred by a recent property revaluation.

Rusconi and crew released an action plan in December calling for a spending freeze to combat recession-era woes. The city has suffered a $2 million loss in investment income and a $2 million shortfall in state grant money this fiscal year, according to the latest monthly budget report.

To finish balancing the budget, the city proposes selling a third property, the former Dwight School at 130 Edgewood Ave. The city proposes to sell it for $4.51 million to Amistad Academy. (Click here for more background on the three deals.)

All three deals were considered at a public hearing before a special Committee of the Whole last Tuesday. The two Yale deals were discharged from committee so they could be taken up for immediate vote by the full board Monday.

The full board hasn’t voted on the Dwight School sale yet; the vote was delayed to give relevant parties time to negotiate. Amistad is negotiating an agreement to let the Greater Dwight Development Corporation continue to use part of the school for neighborhood activities.

The Dwight School sale was put in the budget a year ago, Rusconi said; the two Yale deals are recent additions.

“Once we realized we had a budget issue, we recommended to look at sale of city
assets,” explained Rusconi.

Yale Vice President for New Haven and State Affairs Michael Morand said the university sat down with the city to look at areas of mutual interest. They settled on two city properties that Yale is currently using and maintaining.

Yale has been leasing the 156 Washington Ave. for use as a parking lot for the Yale Medical School. The city agreed to sell it, with one important condition: That the city would maintain an easement on the property so that it can extend Amistad Street through the lot as part of a larger plan to knit two neighborhoods together over the Rt. 34 Connector.

One change was made before Monday’s vote: Instead of setting down a fixed price of $3.35 million, aldermen agreed to give the city permission to sell the land for as low as $3 million. The final price will rest on the results of two studies, according to Chrissy Bonanno, the city’s deputy director of economic development. The studies concern an old sewer easement and a driveway that may be a right of way, she said.

Yale intends to keep using the lot for surface parking, at least until the Rt. 34 work is done, said Morand. As city property, the lot is not currently taxable. Once transferred to Yale, the lot will be eligible for a small amount of state PILOT reimbursement, he said.

The Islands

Yale has already been taking on the responsibility of maintaining the two wedges of land it’s going to lease on Broadway. The 12,247-square-foot area does not include the parking lot. It includes a floral wedge of traffic median called Begonia Island, and a paved park area marked with trees and benches called Market Island.

The two properties provide a backdrop for Yale’s downtown shopping strip. The city plans to lease they to Yale for $400,000 in the first year, then $1 per year for another 98 years.

Morand said the lease “ensures that for 99 years, it’ll be maintained at a high standard. That has value for us as a long-term stakeholder in the area to have that comfort and confidence for the next century.”

Yale has no plans to develop Market Island, though Morand said in a few decades, the university may see fit to improve it according to its original conception, as the home to a small market.







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Comments

Posted by: stptia | May 19, 2009 12:54 PM

Perhaps the city can give Yale a little back so they can hire someone who knows how to garden these areas using sustainable methods. I curse under my breath every time I see this island you have pictured change during the seasons.

Everything is torn up and replaced with something new. My guess is the shrubs, flowers, etc. are simply tossed into the garbage bin. Even if the fodder is recycled, it is lame that they don't know how to garden more practically.

Thanks for giving me the occasion to post about this. I've been looking for someplace to complain for 4 years.

They get very low points in my book over this maintenance. They might as well be putting plastic flowers in the ground for the amount of respect they show for the art of gardening.gad

Of course, Yale is not alone here. The state could be growing fruit trees in places like the huge green patch of land where Trumbull Street connects with 91. I bet that green space is overloaded with pesticides and herbicides to grow simple grass that we must cut and cut and cut. And what do we gain from it?

There are too many green spaces like this doing nothing for us. At least let's plant something that can feed a couple of birds.

Posted by: anon | May 19, 2009 1:59 PM

I agree, Stptia. Fruit trees would be great for that barren stretch of wasteland along the Trumbull Street onramp, as well as on the other nearby ConnDOT properties, which are all currently useless, weed and trash strewn patches.

Unfortunately, even though that property is in the heart of the city and significantly lowers the land values on dozens of surrounding properties, ConnDOT won't even pick up its trash there, much less think about landscaping it into something attractive.

The only solution to this problem in the long term is to remove that on-ramp entirely. That section of I91 should be boulevardized; people can access it via the cross streets like they do with Route 9 in Downtown Middletown. Doing so will free up dozens if not hundreds of acres of prime real estate for dense urban development. The beautiful row houses that used to line both sides of Trumbull Street can be restored. If done right, such a project could easily solve the city's tax base woes. Maybe the city can even get some revenue when the parcels are sold off by the state.

Eventually this will happen; the question is when -- how many more generations have to suffer with blight, pollution, and disease? How much longer before we can stop continuing to give massive government bailouts each year to our money-losing highways and suburban homebuilders?

Posted by: anon | May 19, 2009 2:28 PM

P.S. If the section of I-91 near State Street were boulevardized, the city could create a "River Walk" along the Mill River, opening up hundreds of additional acres for development and recreation. This would tie together East Rock Park, Goatville and Fair Haven.

Here's an example: http://en.wikipedia.org/wiki/San_Antonio_River_Walk

Traffic on the boulevardized section of I-91 could be demand-managed (aka congestion priced) and alleviated through the proposed high speed commuter rail system as well as regional high speed buses. Some of the regional traffic currently funneled through New Haven would also easily be re-routed along the Wilbur Cross and Route 9, both of which are under capacity.

The most obvious difference between American and European cities is that the latter do not have massive highways running through their centers, in the process destroying literally thousands of acres of valuable urban land, and severely degrading thousands more surrounding them.

Look at what happened after San Francisco (Embarcadero Freeway), New York (West Side Highway) and other cities converted their urban highways into boulevards. New Haven could easily do the same, and reap untold rewards.

Posted by: Edward_H | May 19, 2009 3:09 PM

Sell the mayor's armoire and use the proceeds to buy something more sensible from Ikea or Fair Haven Furniture.

http://www.newhavenindependent.org/archives/2008/02/closet_pic.php

Posted by: Blue Dog Democrat | May 19, 2009 5:01 PM

Does anyone else think it is a joke that the City will sell the Dwight school to Amistad for millions, yet sell Shartenberg for $1? We definitely need better schools, and less commercial space, so it should be the other way around. Since Amistad is the only competitor to New Haven's poorly run schools, it must pay to buy a bigger building, as opposed to getting a gift from City Hall.

Equally important, what else is there to sell next year to balance the budget? I'm not sure anything of value is left, and next year will be much worse than this year.

Posted by: bebe1222 | May 19, 2009 9:37 PM

i agree with blue dog... seems like amistad has to pay for the competition it is giving nhps.alsot the neighborhood is soooo against the sale of dwight school to amistad. i read that they want guaranteed spots for the neighborhood children and use of the space when the need arises...

Posted by: Joe | May 20, 2009 2:43 AM

No, they're completely different types of sales. Shartenberg will generate tax revenue in the future, the Dwight School, owned by Amistad, won't.

Posted by: fedupwithliberals | May 20, 2009 7:56 AM

So this is how you balance the books. Sell off the city, bit by bit, to Yale. Brilliant!

Posted by: Almost ex-resident | May 20, 2009 9:55 AM

Yale can buy my house. Perfect for some new-hire academic type whose liberal ideas haven't yet been doused by the reality of living here.

Posted by: anon | May 20, 2009 10:44 AM

Blue Dog, Amistad didn't come with the burden of providing dozens of free parking spaces. Read up on the deal. The city would have sold Shartenberg for more money if it could have transferred away the parking obligations of the CT Financial Center tower.

Posted by: blue dog democrat | May 20, 2009 6:53 PM

I've always believed that competitive bidding gets the best price. I'm sure that any restrictions to the sale of the property would have been considered by anyone wishing to purchase the land. The City might have been able to double its money, maybe gotten $2 for the site.

"Generate future tax revenue" -- sounds kind of like the check is in the mail. How long into the future do we have to wait for this magical money to appear (reality vs. what City Hall is saying)?

I think I have the perfect solution for our City's economic woes. We can have the feds pay us to house all the people released from Gitmo. We have so much vacant and foreclosed property, we should be able to house a few hundred innocent Muslims. That way we can balance our budget and meet our pension and health benefit deficit (last year $50,000 contributed to a $26 million bill). It's a win win.

Posted by: Charlie O'keefe | May 20, 2009 9:10 PM

A few months back we were promised there would be no more sell offs of city assets. I am worried on whats ahead. Huge tax increases. The best idea here is to sell off the Mayors armoire. I think he should be locked inside it when it goes.

Posted by: Streever | May 21, 2009 9:35 AM

Blue Dog:

Selling Shartenberg let us out of serious & expensive obligations to the CT Financial Center Tower. It cost us more money to continue to sit on it then it did to sell it for $1, and we'll have a huge improvement by adding that density to the city.

You actually have your thinking a little backwards: building dense, downtown buildings, will increase the overall safety & finances of the City, allowing us to have better schools.

Better schools == serious money. Giving away Dwight School doesn't help us much, if Amistad has the $$$, because it's tax-free after they gain it.

The Shartenberg is NOT tax free, and will provide housing for hundreds & jobs for many all while also providing the City with significant tax money.

Both deals were smart & well - done, even if they didn't get an assesment on Shartenberg until after we sold it ;-)

Posted by: ParkStTaxPayer [TypeKey Profile Page] | May 21, 2009 11:19 AM

Mayor "I spend taxpayer money" Destefano better not blow the $400,000 on a new desk!

Ok, so this year the $400,000 will be used to plug a budget gap. Why not charge the same amount of money for the next 5 years?

A dollar per year for 98 years? why not lease the island to Yale for 1 year at a cost of $400,000 (where did that number come from?!) and each year after, we can be happy the city isn't auctioning off curbsides and jersey barriers for the sake of bringing the budget to the people, instead of trimming the budget?

Get the spending under control, Destefano! This is getting ridiculous!

10 more days till this shell-shocked downtown-resident moves to the 'burbs. And I'm taking my tax dollars with me!

Posted by: blue dog democrat | May 21, 2009 11:22 AM

Streever,

I don't know all the particulars, and you seem much more in the know than I in re: to Shartenberg, but I do work downtown and have shopped for commercial space. I don't know of one building downtown (or anywhere else in the City) that has 100% occupancy. I also am called once each month or so by realtors, asking if I want to move. I don't think having additional commercial space, when tens of thousands of square feet are available, will help the city. I could be wrong, but if I was asked to invest in the venture, I would turn them down flat. That should be everyone's guide into whether or not a project is viable.

In re: to education, yes the Amistad would not produce tax revenue, and the Dwight School didn't either. I just think that if an institution is valid on its merits, and I don't think anyone would argue that Amistad is a good school, then it should be helped. This City pisses away money to other less worthwhile tax exempt organizations, and if the City was honest in wanting the best for its citizens, then it would encourage and assist the students and faculty at Amistad.

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