Thomas MacMillan File Photo
In his quest to compel state lawmakers to send more money to New Haven, freshman Alder Michael Stratton has personally hired a lobbyist to win suburban support for creating a regional board that would oversee some city spending.
Stratton, who represents Prospect Hill and Newhallville, is trying convince the governor and state legislature to send more cash to New Haven, where 47 percent of the city’s land is not taxable. Stratton has launched two efforts to revive a perennial plea for more payment in lieu of taxes (PILOT) money.
First, Stratton is paying lobbyist Bob Shea to win over suburban lawmakers who may oppose full PILOT funding. In that quest, Shea, a West Hartford lawyer, is equipped with a new idea: If the state fully funds PILOT, New Haven could create a “regional board” comprising representatives of each of the towns that ring New Haven. The board would have non-binding authority to “oversee how we spend 5 or 10 percent” of PILOT money, Stratton said. That way, Stratton said, suburbanites could ensure that money spent on services in New Haven really does benefit the region, as New Haveners often argue.
Stratton is also trying to rally his colleagues on the Board of Alders to pass a resolution calling for the the state to fully fund PILOT. He has secured board President Alder Jorge Perez as a co-sponsor. Click here to read a draft of his resolution.
Fairness
“PILOT” refers to money that the city receives from the state to make up for the fact that so much property in the city is tax-exempt. Colleges, universities, and hospitals do not have to pay property taxes, the main source of revenue for the city.
By state law, the state is supposed to reimburse the city at a rate of 77 percent of the property taxes the city would receive from land belonging to university and hospital properties, and 45 percent for state-owned buildings.
In recent years, however, the state has not even come close to hitting the 77 percent mark. Most recently, according to Stratton, the state paid only 32 percent for college and hospital properties and 23 percent for state properties.
Stratton said the city should receive as much as $50 million more than it has been. That money would help the city lower property taxes by 20 percent overnight, he argued.
New Haven creates thousands of jobs that are held by suburbanites, Stratton said. “At present, they’re not paying for the benefit they’re getting.”
The suburbs reap the benefits of Yale and New Haven’s hospitals as sources of jobs and services, and Yale has “a massive impact on surrounding housing values” because of professors who live in the suburbs, Stratton said.
Stratton said the “biggest rebuttal” from suburbanites who don’t want to fully fund PILOT is that since Connecticut is one of the few states that even offers payments in lieu of taxes, any amount of PILOT is more than cities would get anywhere else.
“That’s another spurious argument, because Connecticut is a very unusual place,” Stratton said. Most states don’t have as many towns, and their cities are bigger, he said. “We [in New Haven] have only 18 square miles to work with” and almost half of that is not taxable.
“PILOT is the way you make this fair,” Stratton said. He said he wants to “make sure the rest of the region isn’t free-riding off the back of New Haven taxpayers.”
Informed of Stratton’s proposed resolution, Malloy spokesman David Bednarz said, “The governor understands their concerns. He will have more to say regarding municipal aid when his budget proposal is released next week.”
Prez Perez
“In general, conceptually it’s a good idea,” said Alder Perez, speaking about Stratton’s proposed resolution.
“We should advocate for 100 percent funding,” Perez said.
“Like any other idea, it may take multiple tries,” he said. Even if the city doesn’t end up with 100 percent PILOT funding, the effort might still yield an increase. “Every journey starts with the first step.”
Perez said he is working with Stratton on the wording of the proposal and has signed on as a co-sponsor.
Perez said he expects the proposal to be on the agenda at the Board of Alders’ meeting on Monday, likely as a fast-tracked “unanimous consent” item.
It’s important to pass it quickly, because the state legislative session is about to begin, Perez said.
Stratton welcomed Perez’s support: “That’s good news because Jorge has the credibility that I don’t.”
Stratton said that as of Friday afternoon, the proposed resolution had five other co-sponsors, all members of the newly formed “People’s Caucus.”
Everybody Likes Bobby
Stratton said he talked to the members of New Haven’s Capitol delegation and found that suburban lawmakers pose the main obstacle to full PILOT funding. Stratton has hired Shea to talk to “four or five” key suburban legislators, including Guilford/Branford state Rep. Pat Widlitz, who chairs the Finance Committee; state Sen. Joseph Crisco; Hamden state Rep. Brendan Sharkey, speaker of the house; and state Sen. Leonard Fasano, the only Republican in the group.
“I used to work with Bobby Shea,” Stratton said. “He’s terrific. Everybody likes him. I called him up and said, ‘Can you help me navigate the personalities? Help me understand what’s important to suburban legislators.’”
One of the ideas Shea and Stratton came up with is the creation of a “regional board” that would oversee the expenditure of a small portion of New Haven’s PILOT funds.
“[New Haven] would be called a ‘regional hub,’” Stratton said. Bridgeport would also be a regional hub. “Each town in the ring around the hub would have one member on the board. They would oversee how we spend 5 or 10 percent of that money.”
The board would help ensure PILOT money is used to “enhance services people in the suburbs enjoy,” Stratton said. Giving the suburbs this kind of input would make a vote to fully fund PILOT more attractive to suburban lawmakers, Stratton argued.
“The regional board recommendations wouldn’t be binding,” Stratton said. But if the city chose not to follow the board’s advice, it would have to demonstrate how PILOT spending serves the suburbs.
Stratton said the creation of a regional board would be way to increase regional cooperation in general. Stratton said his hope is that new board would lead to things like the regionalization of library systems, or fire service.
“We need regionalism,” he said. “And we need a vehicle to get us to do some more regional activity.”
Perez said that Stratton’s “regional board” idea sounds premature, and complicates what is otherwise a simple request to the legislature.
“Let’s get to the first base before we start talking about the second base,” Perez said.
The resolution itself says that New Haven should have control over the funds. “We shouldn’t negotiate against ourselves,” Perez said.
And the city shouldn’t make a basic request into a complex one, Perez said. “Our ask is very simple. We’re asking the state to fund PILOT fully.”
“Culture”
Stratton said PILOT funding is vital in part because it’s one of the city’s largest sources of unrestricted spending money. He said the state often gives New Haven money with strings attached, earmarked for very particular purposes.
“Then we say, ‘Where’s our PILOT?’ And they say, ‘We gave you those programs,’” Stratton said.
It amounts to a kind of “charity,” not full empowerment, Stratton said. “That’s the culture that’s developed.”
Politicians find money for “pet projects” but not for PILOT, which allows them to stand in front of a health clinic or a new youth program and say, “Look at the pity I showed New Haven.”
“It’s not malevolent,” but it is “patronizing,” Stratton said.
The current system is “incredibly wasteful and inefficient” and “it keeps us in chaos,” Stratton said. The city can’t budget effectively because it can’t know how much money it will get from the state.
This appears to be more political stunt and an early swipe at Harp than a well thought out attempt to impact policy. New Haven has had two members of congress on the appropriations committee. They fought aggressively for PILOT each year and PILOT dollars always increased over what was budgeted. However, the state is running at a deficit (despite its budget surplus - two very different things).
More important than any lobbyist is that Governor Malloy needs to carry New Haven, Hartford, and Bridgeport in order to win reelection. He has an ally in Mayor Harp who will undoubtedly use her influence, again, to achieve higher levels of PILOT funding. And while Mr. Stratton appears to have sights set on the Mayor's seat, he should be communicating with the governor and other delegates directly if that is indeed his desire.
Until then, this is little more than smoke and mirrors. And a City can't impose or pass legislation requiring a state fully fund PILOT or otherwise. Again, smoke and mirrors.