Nystrom off to good start, but Norwich agenda must include CCD tax

Peter Nystrom has set an ambitious tone at the start of his second term as Norwich mayor. Defeated in his 2013 re-election bid, voters in this traditionally Democratic city returned the Republican to office in November after incumbent Democrat Deberey Hinchey did not seek re-election.

In his recent State of the City Address, Nystrom asked the City Council, where Republicans hold a 4-3 margin, to consider expanding the revitalization investment program — which has had success of late in driving revitalization in the downtown — to adjacent urban areas.

While the proposal is now only a concept — the mayor did not provide a specific financial request — it is an interesting one.

Voters in 2010 approved the revitalization investment program, making $3.8 million available to fund a mixture of redevelopment grants, loan programs, rental rebates and other incentives to encourage development of vacant or underutilized downtown storefronts and residential units. After an initial slow start, the program more recently has encouraged development on Franklin and Main streets and lower Broadway.

Nystrom proposed expanding the program to the Greeneville neighborhood, along West Thames Street (Route 32), including a former industrial area along the harbor, and to the West Main Street section that connects the downtown to the city’s commercial strip.

Incentives to drive development in these areas, which are gateways to the downtown and the harbor, would have the added benefit of making downtown investment more attractive to potential developers.

The mayor would face a challenge in selling the idea, which would likely require another bond issue, to the council and ultimately to voters. But the credibility Nystrom and the past council gained by holding down the general tax rate could help in generating broad support for such a proposal.

Nystrom should also continue to explore whether the municipally owned utility, Norwich Public Utilities, could boost from 10 percent to 12 percent the percentage of gross revenues it contributes to offset city expenses.

NPU General Manager John Bilda has pushed back against the idea, noting that NPU already contributes the highest percentage of gross revenues to its host municipality among all the publicly owned utilities in New England. He has made the case that NPU would have to pass along a rate increase to provide the additional 2 percent of gross revenues.

Controlling taxes by raising electric, water and gas bills is not a sound strategy. Maybe the idea will prove not to be a good one. But Nystrom and the council need to test Bilda’s contention and explore whether savings can be found within the utility operation, without detracting from service or raising rates to cover a 12 percent contribution.

One area Nystrom does not appear eager to explore is the back-breaking and development discouraging special tax that property owners must pay in the City Consolidated District — consisting of the downtown and surrounding neighborhoods. This is largely the same area Nystrom wants to target with his revitalization investment program. Addressing the high taxes there should be part of any redevelopment strategy.

Property owners in the CCD get hit with a 7.84 mill added tax to pay for the paid Norwich Fire Department which protects them, but which also offers assistance in surrounding neighborhoods served by volunteer departments. Property owners outside the CCD pay 0.47 mills in added tax to finance the volunteer services.

Add the special CCD tax to the regular mill rate, and property owners in the downtown end up with a nearly 50-mill tax bill, excessive by any measure. Expanding the tax burden citywide is the solution, but Nystrom has chosen not to touch this third rail of Norwich politics or offer a viable alternative to address the issue.

In the interest of economic development, and fairness, he needs to do so.

 

 

The editorial board is composed of the publisher and four journalists of varied editing and reporting backgrounds. The board's discussions and information gained from its meetings with political, civic, and business leaders drive the institutional voice of The Day, as expressed in its editorials. The editorial department operates separately from the newsroom.

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