Stonington — A large number of residents flocked to the polls Tuesday to soundly reject a proposed tax break for the developer of an 82-unit affordable housing project on the former Campbell Grain site in downtown Pawcatuck.

The vote was 2,764 to 1,173 to overturn the August town meeting vote that approved the $697,748 tax break over 10 years for Winn Development of Boston. Almost 4,000 voters — 3,937, or 27% of registered voters in town — cast ballots, the most for a referendum in more than 34 years. The opposition was led by Pawcatuck voters, who rejected the fixed-rate assessment by a vote of 1,539 to 314.

Residents also voted 2,106 to 1,816 to reject a proposed ordinance that would have prohibited a cannabis establishment within the town. This means the town can now permit one marijuana shop and one producer/grower to operate.

The retail business is expected to not only be lucrative for its eventual operator due to its proximity to Rhode Island, which has not legalized marijuana, but also for the town, which can place a 3% tax on its sales. That would result in hundreds of thousands of dollars of annual tax revenue for the town.

Tax break was controversial

The defeat of the tax break was a blow to town officials who have worked for years to develop the site as part of the effort to revitalize downtown Pawcatuck. They have said a defeat now means Winn will have difficulty in obtaining the $20 million in state funding and tax credits that ask for a contribution from the host municipality. The vote, though, does not kill the project, which could still be built.

Dave Hammond, chairman of the Economic Development Commission, whose members have focused on revitalizing downtown Pawcatuck and have worked on attracting a developer for the grain building site for years, said he was "really, really disappointed."

He called it "shameful" that people "imagined and prioritized" issues such as parking and traffic over creating affordable housing  for residents.

"It's hard to understand their motivation for overturning this," he said. "But we'll continue to work to attract investment to lessen the burden on taxpayers, including those who voted against this project." 

Winn's project director, Matt Robayna, said Tuesday night that his company still will apply for the state funding but said it will face an uphill battle against other projects that have a municipal contribution. 

"We still feel strongly about this project," he said. "We feel it will provide needed affordable housing, bring economic development to the downtown and generate revenue for the town."

He said Winn would have to fill the $697,000 gap with money from other sources.

Robayna said that while Winn was surprised by the amount of opposition, he said it understands affordable housing can be a "hot-button issue for communities."

First Selectwoman Danielle Chesebrough called the the size of the opposition "disheartening" saying some of it was spread on social media by residents who did not understand the facts and "played on people's fears."

But Chesebrough said it was time to move forward and called on residents to become involved early on in the process by attending meetings or talking to her or other town officials. In addition to criticizing and pointing out flaws, she called on residents to offer solutions and opportunities.

"We want to move forward in a positive way. We need people to be engaged," she said.  

"Public service is not easy, but it is important, and we genuinely ask that you choose to stay involved and help us identify solutions to the challenges we face as a community and build on opportunities before us. It is much easier to criticize each other, but what we need is people willing to come together to bring about solutions that will work for our community," she added.

But voters in Pawcatuck were clear about their opposition Tuesday afternoon.

"Everything about it stinks," resident Colleen Schultz said about the four-story building planned for the end of Coggswell Street next to the Pawcatuck River and the Amtrak rail line.

She cited a lack of parking (92 spots were proposed), restricted access on the narrow street, a location next to the railroad tracks and giving a developer a tax break that residents don't get, as reasons why she opposed the plan.

Voter Anne Sorel said there had not been a lot of publicity about the town meeting vote, and said she felt town officials "were pulling the wool over our eyes."

Her husband, Jeff, said that with 75% of the project to be funded by state grants and tax credits, along with a $697,748 tax break from the town over 10 years, Winn was "making out like a bandit."

The Pawcatuck voters also were worried about the traffic the project would generate in an already congested downtown and pointed out other newly built affordable housing in Pawcatuck is not yet rented.

But Chesebrough said this was one piece of misinformation being circulated by opponents. She said town officials monitor vacancies, and there are none. On average, she said every affordable housing facility in town has a wait list of 2 months to 2 years.    

Opponents of the tax break also have said the building would be too large and not attractive, and questioned why more affluent areas of town, such as Mystic and the borough, do not host any affordable housing.

Residents at the Aug. 9 town meeting voted 71-36 to approve the fixed-rate assessment, but a group of residents then collected the signatures needed to force the referendum vote. While Winn Development would have saved $697,748 in taxes over 10 years, it would have paid $695,000 in taxes to the town during that same period. If the parcel remains vacant and undeveloped, it will generate less than $30,000 in taxes over the same time frame.

The project calls for a mix of studio, one-, two- and three-bedroom units that would be rented at prices affordable to people who earn 30%, 50% and 80% of the area median income. The project also would contain market-rate units. Plans also call for extending the public Pawcatuck Riverwalk to the property.

Winn is seeking $20 million in funding from the Connecticut Housing Finance Authority and the Connecticut Department of Housing through a competitive grant process that asks for a match from the host municipality.

Town officials see the site as crucial for the redevelopment of the downtown and said the project would provide more housing options for working-class residents who struggle to find affordable units. They say it would generate more pedestrian traffic downtown that would patronize existing businesses and possibly spur more investment. And it would generate much more tax revenue for the town than it does now.

Marijuana sales are OK with voters

Voters The Day spoke with in Pawcatuck on Tuesday were much less interested in the second question, on marijuana sales and production in town, saying they supported the idea or didn't really care.

"We should have been doing this for decades," voter Justin VanDuine said about allowing cannabis sales.

The proposed ordinance would have prohibited a "cannabis establishment" within the town. It defines such an establishment as a producer, dispensary facility, cultivator, micro-cultivator, retailer, hybrid retailer, food and beverage manufacturer, product manufacturer, product packager, delivery service or transporter.

According to the state law that legalized the recreational use of marijuana and took effect July 1, municipalities have discretion to allow or prohibit cannabis businesses within their borders, as well as regulate signs and operating hours of such businesses.

The law allows one retailer and one retail grower for every 25,000 residents, which means the town and Stonington Borough each can have one grower and one retailer. Municipalities also can bill cannabis businesses up to $50,000 for the extra police and infrastructure required for the businesses to open. Towns also can implement a 3% tax on marijuana sales.

j.wojtas@theday.com