Chairman's View: "Please, Tell Us What a 2% Budget Looks Like" - my column for the New Canaan Advertiser March 5, 2018

Darien schools are requesting a budget increase of 2.34% (including the new tuba). Wilton’s school board is asking for 2.24%. Note, in the last 3 years Wilton has averaged less than a 1% per year. The Stamford public schools requested an increase of 1.48% after coming in last year at 2.2%. Stamford’s low increase was largely the result of a new employment agreement with teachers that moved them from a private insurance plan to the state’s, saving money for taxpayers and teachers. Two months into the budget season New Canaan’s Board of Education continues to request 3.48% saying this is the price of excellence. Think about that: two months into the budget season and there have been no attempts on behalf of the BOE to debate and cut their own budget, no attempt to bring it in line with BOF and BOS guidance of 2%, saying instead that “priorities are purposefully in tension with the Town Council and BOF” 

Half of the Town Council was in attendance at the last Board of Finance meeting and one veteran member said, “I was waiting for someone to simply ask to see the 2% budget as Bryan must have that ready by now…the BOE has been preparing for a couple for months for this.” 

BOE lawyers might say its legal, but without public meetings of a Curriculum Committee or at the Board of Education level we do not know where cuts to the budget will be felt. Advertiser stories on pages 1, 3, 4 and 6 all point at the problem most citizens have in not knowing where cuts will be felt until after we’ve made them. 

A few years ago the Administration needed curriculum development in response to state mandates for social and emotional learning (SEL). New Canaan took the lead statewide and developed a new curriculum, probably the best in the State.  Curriculum development money is still in in the budget, compounding every year. We spent $15,000 on Happiness training for teachers and $31,500 on a Climate workshop. This year we are adopting the Yale RULER curriculum for $42,000. We are already number 1. Can we please take one year off from curriculum development?

Please don’t threaten to cut favorite programs. Reduce the budget in non-teacher headcount. In the last 3 years enrollment went from 4174 to 4184. We added 10 new students but we added 19.5 net new staff, a $676,147 increase. If you add insurance, pension and benefits that increase exceeds $1 million. In the last 10 years the Board of Ed has added 64 new full time equivalent staff and teachers during a period of relatively flat enrollment. 

Teacher stipends have increased 56% from $622,939 to $970,116 since 2016, offset in part by parent donations and ticket revenues. But that money still comes from parents one way or another. 

Connecticut requires 1.0 credit of health and gym. Darien and Wilton meet the 1.0 credit minimum. New Canaan requires 2.25 credits including substance abuse counseling. Could reducing gym and health to state minimums be part of an opportunity to shorten the school day and provide later sleep times?

2018 is not business as usual after State cuts. As Tom Butterworth correctly points out, we run the risk cutting to 2% without knowing where its coming from. Please, tell us what a 2% budget looks like.

Chairman's View: "Its Getting Harder to Find Woods and Meadows Where a Dog Can Roam Off-Leash" - New Canaan Advertiser January 22, 2018

Its getting harder and harder to find woods and meadows where a dog can roam off-leash. Under Article 6, Section 8 of the Town Charter, dogs aren’t allowed off-leash anywherein New Canaan public parks except in Spencer’s Run at Waveny. 

That includes the Bristow Bird Sanctuary, whose deed requires it “forever [be] maintained as a Bird Sanctuary and Wildwood Preserve and used for no other purpose whatsoever.” That language prompted a recommendation by Parks & Rec in 2014 to ban dogs from Bristow. Dog lovers responded and the Town Council took up the debate in 2015. We ruled with the dogs when Animal Control Officer Kleinshmitt testified that deer, not leashed dogs, have the greatest impact on ground-nesting birds. Vice Chairman Steve Karl recognized the importance of green corridors to our community saying, “Hopefully between the Conservation Commission and Park & Recreation Commission, we can make some improvements over there to make it nice for everybody—people, birds and dogs.”

Now what? The Land Trust off-leash policy is under review. When off-leash dogs are not controlled they present a problem for neighbors and walkers. Recently, there was a complaint over large dogs jumping on an 18 month child in the 40 acre Watson-Symington Woodlands. Another dog ignored his owner’s pleas and followed a jogger down Wellesley Road. 

All other Land Trusts in Fairfield County require that the dogs be controlled on leashes (with one exception). Some board members believe the intensity of use on more popular parcels warrants rethinking land trust policy there. 

New Canaan is proud of the fact that we can offer off-leash walks, a rare privilege indeed. The response to traffic is increase our holdings and open up more parcels to public visitation, saying we have enough land to accommodate everybody. Chris Schipper called the incident the rare exception saying, “We’ve had 2 complaints in 5 years. Neither were members of the Land Trust. Don’t create blanket rulings to deal with exceptions. There are many other parcels to visit.” Discussion continues. 

Sunday April 22 is Earth Day. The Land Trust will open a new Green Link trail between Irwin Park and the Nature Center, completing a 3-mile walkable loop. As New Canaan “nature sanctuaries” become more popular should they be managed like Parks? Write your vote on the back of a $100 bill and send it to the Land Trust at Box 425, New Canaan, CT 06840

Chairman's View: "New Years Resolutions" my New Canaan Advertiser column for January 11, 2018

I’ll begin with 2018 New Year’s Resolutions from Town Council members:

Penny Young wrote, “Keep an open-mind and listen, listen, listen... the path forward will become evident.I will be mindful of our responsibility to preserve, maintain, and address the physical and operational needs of one of our most valuable resources— our buildings.”

Elizabeth Gores-Donovan said, “Top priority to take advantage of the "building momentum" of the recently published Building Use Report. Also plan to push for development of appropriate public/private partnership process and guidelines.”

Tom Butterworth weighed in saying “We're giving fast-track consideration to Dr. Bryan Luizzi’s breakthrough idea to put the long-vacant "Outback" building to a money-saving use as an alternative school for students with special needs.”

Cristina Ross added “Create defined procedures that address the financial appropriations process for all construction projects pertaining to our infrastructure, in order to better manage the contract administration process.”

The immediate priorities for the Town Council center on decisions around three buildings: the Outback, Waveny House and the Police Station, each of which is projected to have a large line item in this year’s capital budget. This week we consider the Outback where Superintendent of Schools Bryan Luizzi has made a proposal to create an Alternative High School there.  He will need a quick decision from the TC in order to begin planning and budgeting a Fall program. It may cost the Town between $500,000 and $1 million to rehabilitate the building whether or not we use it as a school and Dr. Luizzi’s plan shows potential cost savings over $100,000 per year to us versus the current practice of outsourcing this program out-of-town. Questions remain: How viable is this plan? Are there any alternative uses for that building that respect the intent of the original donors? Can we make more than $100,000 per year renting the building to a private party? The clock is ticking.

Steve Karl wrote, “I fully support the idea and the concept and welcome the BOE’s input on this initiative. The only prerequisite I have is that we are shown the exact financial path forward that allows the town to have no ongoing expense associated with this project. And no debt associated with putting money into it to get it started to see “if it will work” . . . We can’t afford to simply fill a building because it’s empty.”

What are your resolutions for your Town Council? Let us know.

Chairman's View: With Compliments and Thanks

By John Engel

Town Council Chairman

Christmas is behind us. Before the New Year’s excitement I’ll take this opportunity to thank some volunteers.

Government

To Bill Walbert and John Sheffield, departing chairmen of the Town Council and Board of Finance. Neither asked for the job of chairman. John is a fiscal conservative: voted against an appropriation for land acquisition, an increase in the treasurer’s salary, and in the tax collection rate. It’s hard to say no, but you were tough. We will consider ourselves privileged to have a similarly involved leader in our next Board of Finance chair. Bill Walbert managed to lead the Town Council without ever saying a cross word. He told me the best part of the chairman’s job was thanking the incredible volunteers who serve this town everyday. Bill inspired this column.

The New Canaan Library

To Bob Butman and his Library board, the greatest example we have of a public-private partnership: The town pays only a fraction of your budget, far less than surrounding towns, and we recognize how deficient your current space is. We’ll ask you to build us a spectacular new library and tell us how you’ll pay for most of it privately (please!). All of New Canaan needs you to succeed. What you propose will last for generations.

The Waveny Park Conservancy

Thank you Bob Seelert and the Conservancy Board for exceeding all expectations in the 50th year of the Lapham gift, polishing the jewel of New Canaan. Trails are done, the cornfield is being renovated, gardens are planned, and restoration of the pond is a certainty after an outstanding gala earlier this month. Bravo.

The New Canaan Land Trust

To Art Berry and the Land Trust Board: Thank you for adding not just six acres in Fowler purchase but a vital public park in a neighborhood that had none. Thank you for linking the Nature Center to Irwin Park, pushing for a Land Acquisition Fund, and making us more appreciative of open space.

The Historical Society

To Mark Markiewicz and the other Historical Society board members working overtime to move beyond your revolutionary roots: Besides the Ice Cream Social, “House of Cars”, “Waveny, Then and Now”, “Art America,” and “New Canaan Modern Architects” in the Carriage Barn, you’re planning an art show on Orientalism, a belly-dancing performance, the Mad for Moderns gala, and the bi-annual Modern house Day Tour (Oct. 20, 2018). There’s a reason to go to 13 Oenoke besides the Advertiser Coffee.

"New Canaan Made Plain" (my column for the New Canaan Advertiser)

This column is making good on a promise of transparency. As your bow-tie wearing Town Council Chairman, rarely accused of being shy, it’s my charge to let people know what is going on in New Canaan.

Bankwell is quitting the residential mortgage business. Based on Bankwell’s tremendous history and visibility here in New Canaan (sponsoring just about every non-profit event in town) this is a shock. It reflects how competitive the residential mortgage business has become. It’s a funny time to leave the business, just as rates are about to tick up and the business could become more profitable.

The Town Council confirmed Board of Finance nominees: Colleen Baldwin returns; Todd Lavieri is new. When the BOF issued their guidance last month setting a cap of 2% on all budgets and the First Selectman reaffirmed that guidance we set the expectation for a tough budget season.

Town Council announced subcommittees last night. We had huge interest in the Infrastructure and Utilities Subcommittee where we will review potential cell tower sites on town properties (note new cell tower P&Z regulations are in draft for private properties), the roll out of gas service and the newly released Buildings Committee recommendations. Penny Young and Cristina Ross chair our subcommittee with Sven Englund, Joe Palladino, Tom Butterworth and Liz Donovan. New Canaan signaled low appetite for school and park sites. Private cell sites may now emerge.

The Town Council is beginning a new tradition: start each meeting with the Pledge of Allegiance led by local Boy Scouts, Girl Scouts and Cub Scouts. Good for the scouts, doubly good for the adults. We will stand.

People keep asking me what is happening in our real estate market and how will it affect our budget. As of December 1 the number of single-family home sales is up 36%. The median sale price is exactly $1.5 million. Sales below $1.5mm are up 41% while sales above $1.5mm are up 32%. The bottom half took off early this year, sales under $1mm were up 147% in October. Now, we see strength at the higher end as confidence moves up-market. Four sales this year over $5 million with another 2 sales pending is a good sign for the New Canaan market.

All 4 performances of the NEAD Nutcracker sold out last (snowy) weekend, 3000 tickets, the first ever with a live orchestra. Bravo. There’s one (charity) show this Saturday.

www.ncadvertiser.com

November Market Report for New Canaan and Fairfield County

We are having a very good Fall market here in New Canaan, not just in comparison to 2016. This chart makes it apparent that 2014 and 2015 were exceptional years and that 13 sales is more typical.

This chart of cumulative house and condo sales over the last ten years is a more sobering view. 216 single family house sales and 43 condo sales is fairly typical and last year was particularly poor here.

279 Active House listings is too many. This number has doubled from 145 back in 2000 and about 220 in 2013. The number of people in New Canaan has remained unchanged in the last 20 years so why has the number of active listings doubled? A good deal of this has to do with the financial and tax situation in Connecticut. There are many more opportunistic sellers than there were 10 years ago.

The number that jumps out on this chart is the number of closings under $1 million, up 147% year over year.  There is always a buyer for a relatively inexpensive home in this market, given the high quality schools and low taxes. So why did that number jump this year? One factor could be the relatively low number of inexpensive rentals on the market. When faced with limited options to rent many people opted to purchase instead. A second factor is the increase in inventory. Given the record levels of inventory, and the relative stability of prices and low interest rates, buyers did respond.

There is still 6 years of inventory above $5 million. This has to come back into balance. The number of active listings under $1 million is only 41 which makes it unlikely that we can sustain the current level of sales of 52. In the $1-2 million category we have about 1 year of inventory and that is a balanced market. 

Ah, condominiums. The condo market follows the housing market. When houses are selling then it produces buyers for our condo market. As we can see in the chart above there are sales at all levels in the condo market, and the current level of about 4 condo sales per month is consistent with condo performance over the last ten years. We expect that the increased volume in the housing market will result in higher median prices in the condo market.

What's wrong with Greenwich? Nothing. A 5% drop in volume is statistically insignificant because they had a relatively strong year last year. Prices are now $300,000 higher than New Canaan and Darien and this could account for the drop in volume. As I recall the prices were much tighter between the three towns a year ago. What is significant are the large increases in volume in 4 markets and small increases in volume in another 5 markets.

Inventory keeps climbing. While it is true that we're having a brief respite after hitting new records again in 2016, inventory levels are still much too high and reflect a whole generation of opportunistic sellers. Rather than settle into a home for 20 years people are much more willing to regard their primary home as an investment (and take a profit when it is presented).

This chart shows the seasonality of the number of listings is still a factor, with the peak number of listings in June before all of the pending Spring transactions have cleared.

The volatility in the November December months comes from houses coming off of inventory for the Christmas holidays. 

The absorption rate dives between November and January as people take a break from the market and pull their houses off with the expectation of re-listing in February or March. By May everything is back on the market and the number of sales outpaces the addition of new listings.

Ninety five percent is typical for the ratio between listing prices and selling prices. We have found that buyers will not typically make credible opening offers below 90% of asking price and prices tend to settle at the mid-point of the bid and the ask, 95%  What is far more instructive is the ratio to original list price which is consistently below 90% for the first time in recent memory.

New Canaan Advertiser Endorsement for Town Council 2017

Thank you, Greg Reilly and the New Canaan Advertiser for endorsing the New Canaan "Core Four". — with John Engel, Richard Townsend, Penny Young, Tom Butterworth, John Engel for New Canaan Town Council, Rich Townsend for New Canaan and New Canaan Republican Town Committee in New Canaan, Connecticut.