Chairman's View: Picking Priorities (Dec. 6, 2018)

Chairman’s View: Picking priorities

DECEMBER 6, 2018 BY JOHN ENGEL. CHAIRMAN, TOWN COUNCIL

“I do have to pick my priorities. Nobody can do everything.” — Ray Kurzweil

We held the first joint offsite meeting among the four funding bodies (Board of Selectmen, Town Council, Board of Education, Board of Finance) in over 10 years, an important step toward approaching our town and school budgets with a spirit of cooperation.

Critical takeaways: 10 of us think that the budget is driven by the Board of Finance, 10 believe we all share it, and nine votes were scattered among Town Council, Board of Education and Board of Selectmen. It’s a shared responsibility but clearly, the BOF is driving the bus. Most of us believe that the budget should come in at an increase of between 0% and 1% this year, a big change since last year’s debates between 2% and 3.5%. We agreed a joint meeting should bookend the budget process every year: November and May. And, support was nearly unanimous for conducting a professional town-wide survey.

We had our last forum on town buildings in April. It is time to listen again. The Town Council is scheduling a public hearing for Wednesday, Jan. 9, to solicit input from the public and discuss our buildings within the context of the 5-year Capital Plan. Why is it necessary and why now? In April the focus was on preservation of important buildings and the need to decrease building expenses. There have been several articles over the last six months floating different possibilities for the Library, the repurposing or demolishing of Irwin House, purchasing the Covia Building, renovating the old Police Station (or repurposing it as housing), selling the Vine Cottage and renting the Outback. These options are interrelated and now we know the costs. Some of these initiatives should be put in the Capital Plan and others removed. We need to get serious and specific about our priorities and make sure they are accurately reflected in the Capital Plan and this year’s budget, reflecting the towns people’s appetite.

The Library was put in the 5-Year Capital Plan for $5 million by First Selectman Robert Mallozzi. It would help the Library board secure additional private funding and allow them to “think big” if we put the Library in the plan for $10 million. That is incredibly hard to do during the revaluation, but if we were to plan for a matching gift, 2-1 behind private donations, and stretch that commitment from three years to potentially five years it works within current Board of Finance guidance. I believe a $10 million earmark has the support from the majority of the selectmen and Town Council. If the Library cannot raise $20 million then Town Hall is not committed. But, by signaling a cap of $5 million in the capital plan, the Board of Finance is essentially killing the project. If you feel strongly that a new library will be transformational to the health of our downtown, let the Town Council and Board of Finance know.

Chairman's View: Revaluation (Dec. 20, 2018)

Chairman’s View: Revaluation

DECEMBER 20, 2018 BY JOHN ENGEL. CHAIRMAN, TOWN COUNCIL

New Canaan’s real estate grand list fell by $570 million (7.15%) compared to 2017.In the recent revaluation:

• 4,861 parcels saw average decreases of 11%.
• 2,308 saw average increases of 13%.
• For homes worth more than $3 million, the average decrease was 14%.
• For $2 million to $3 million homes, the average decrease was 10%.
• For $1 million to $2 million homes, the average decrease was 7%.

Homes less than $1 million saw an average increase of 1%. Multifamily homes decreased 4%. Commercial properties increased an average of 13%. Condominiums increased 9%. 

We will not know what the new mill rate is and the new taxes are until the MuniVal consultation period is complete (this week and first week of January), then the Board of Assessment appeals process is complete (February) and then the (town and school) budget process ends with the Town Council vote April 4, 2019. 

If your revaluation is factually wrong then schedule a meeting this week for early January with MuniVal, the revaluation company and correct the facts (203-292-5500 or newcanaanreval@munival.com). If unsuccessful, then you must appeal in person to the Board of Assessment Appeals with facts about your house and comparable sales that occurred between Oct 1, 2017 and Oct 1, 2018. Appointments are given February 1 to 20 and the appeals take place in March. Sales that fall outside of that 1-year window are considered but carry less weight. 

After the 2013 revaluation the Board of Assessment Appeals increased two assessments and reduced 187 of the 285 appeals filed. Some homeowners appeal alone, others take a Realtor or an attorney. Some attorneys charge by the hour. Others work on contingency, taking a percentage of a successful appeal. If an appeal process is unsuccessful, the recourse is a lawsuit. Five years ago, 13 homeowners filed lawsuits against the town. Two were subsequently withdrawn. It takes three or four years to resolve a lawsuit.

Assuming health care rises 5%, town salaries rise 2.8%, school salaries 2.2% and $2.5 million comes from the general fund I expect expenses to increase 1.47% with “level services” and 1.86% if we follow Board of Finance guidance. Therefore, the mill rate announced in May will be between 18.61 and 18.69. That’s up 10% from 16.96.  A homeowner’s revaluation would have to decrease 9% in order to see a drop in taxes. To calculate your 2019 taxes multiply .01862 by your new valuation. (The spreadsheet is posted at johnengel.com).

Darien is revaluing now. Their assessor predicted most revaluations within 3% or 4% of their previous valuation. He expects the Darien mill rate to remain close to their current 16.08 rate. Wilton, now at 28.19, will send out revaluation letters in early January. Ridgefield’s grand list rose one half of one percent in their February 2018 revaluation, a 28.78 mill rate. Westport’s mill rate has been flat at 16.86 for 2 years and they won’t revalue until 2020. New Canaan experienced a 3% drop in the 2013 (reval) grand list but gained 1% in most years since (up $84 million, $85 million, $81 million, then $51 million in 2017).

Chairman's View: 11 Resolutions for 2019 (Dec. 31, 2018)

Chairman’s View: 11 resolutions for 2019

DECEMBER 31, 2018 BY JOHN ENGEL. CHAIRMAN, TOWN COUNCIL

When Advertiser reporter Grace Duffield asked for a New Canaan resolution, I could hardly stop at one. Here’s 10 more. We have much to do in 2019.

1. Bike paths from New Canaan to the Darien beaches. Darien suggested this. Get state permission to paint the bike stripe down South Avenue. What are we waiting for? Also contract to add bike rental racks at Waveny, Irwin Park, Waveny Park, Kiwanis Park, the Glass House and Grace Farms. Stamford is offering bike rentals downtown.
2. Recycling: Let’s get serious. New Canaan now pays $197,000 to sort garbage, up 5 times, and this is just the beginning. We must separate glass from plastic from garbage. Ban supermarket plastic bags. Reuse and recycle paper bags.
3. Caffeine & Carburetors: Bring it downtown permanently. Ask all stores to open those mornings. Help wanted in stores? Tell us what you need. We all volunteer to help.
4. It’s time to paint the big Waveny water tower and take the unused tower down. It’s metal, so put a massive New Canaan Rams  car magnet on it. Change it periodically. Special messages for Darien games.
5. Resolve to post more positively, not negatively, on social media with constructive ideas and thanks. The rest of the world is watching.
6. No more stolen cars. Resolution for everybody to get in the habit of taking their keys with them. Strengthen neighborhood watch. Work together to watch out for each other.
7. We have new Board of Education leadership. With this change I hope to see the board present a budget within Board of Finance guidance instead of passing the Superintendent’s budget without challenge and then fighting with town government for status quo. Change the paradigm.
8. The end of political yard signs. We can’t ban them. We need a gentleman’s agreement. All it takes is the willingness of the two parties. If a candidate sees he is the only one littering the town with signs for a month he won’t do it.
9. The end of real estate signs in residential neighborhoods. P&Z promised they would address this. All other commercial signs are banned so why is real estate the lone exception? This one is obvious.
10. I want preservationists to objectively rate our buildings and work with the town on a long-term public private plan instead of criticizing each new proposal one at a time.  What restrictions should be put on the sale of Vine Cottage, the Playhouse, the Police Station? Is the Library really sacred? It’s time to make choices. How can we sustain rentable assets like Gores Pavilion, Vine and Waveny as long-term break-even propositions?
11. High speed electric car charging stations downtown? This initiative is aimed at tourists since residents charge at home. Encourage Merritt Parkway transients to shop or eat here while charging. Our Parking Commission should identify ideal locations, both public and private, and market their existence online.

Chairman's View: Not to Eliminate Buildings, But to Eliminate Expense (Jan. 22, 2019)

Chairman’s View: ‘Not to eliminate buildings, but to eliminate expense’

JANUARY 22, 2019 BY JOHN ENGEL, CHAIRMAN, TOWN COUNCIL

In the fourth week of a federal government shutdown it’s a good time to reflect on the state of Connecticut and town government. There is cause for optimism.

Newly elected State Sen. Alex Bergstein announced the State is pursuing a policy of “shared risk.” I asked “Shared between whom?” because last year’s plan was to add a $4 million burden onto New Canaan.  The senator clarified she meant shared between the union workers and the State. If Gov. Ned Lamont agrees and the renegotiation and restructuring is finally underway, then this is great news.

Our grand list went down 7%: First Selectman Kevin Moynihan says he can bring in a town budget growing 0% to 1%. Is this because of a 1-year anomaly in the debt service? Does this assume only 5% rise in health care costs? Or, are we making the hard choices? It should be 0%. 

The Brick Barn: A relatively minor building in our portfolio, it has taken on outsized proportions for our citizens. We cannot ignore the fact that Town Council and two selectmen demanded to see alternatives to demolition. We owe it to the electorate to explain why we must spend $65,000 on demolition when the New Canaan Preservation Alliance says it is fully funded and ready to restore now at no cost to the town. The Board of Selectmen is at a stalemate until the first selectman convinces his fellow selectmen or they convince him. If a stalemate then the demo money is returned.

The Police Station: It feels reckless of us to talk about a new $16 million to $20 million police station between Saxe and the YMCA when there is only $7.8 million in our capital budget. And, that is the absolute worst location. Where is the money coming from? What other locations are being considered? Will this spending come at the expense of library or Waveny renovations? How far does $7.8 million get us?

Irwin House: First, it was to be a museum. Then, offices for nonprofits. Then Board of Finance members asked for demolition costs. The Town Council was understandably anxious to hear that we were talking about amendments to the deed with no explanation. Russ Kimes made an excellent case that it be repurposed as the school administration building, saving us $300,000 per year.

Vine Cottage: Make this charming building part of the historic district. Put out a Request for Proposals by May 1. There are businesses that will sign a long-term ground lease and fix it up. Any proposal that preserves Town Hall parking and which transfers restoration responsibility to the tenant should be considered.

Keep these buildings at no expense and with benefit to the public. The most important thing is not to eliminate buildings, but to eliminate expense.

Chairman's View: Revaluation and the Condo Market (Feb. 28, 2019)

Chairman’s View: Revaluation and the condo market

FEBRUARY 28, 2019 BY JOHN ENGEL, CHAIRMAN, TOWN COUNCIL

Condominiums rose 9% in value in a 5-year total revaluation that was down 7.19% The average condo owner will see a double-digit increase in their taxes, Specifically, 955 condos will see average increases in taxes of $1,137. Many condo owners are upset. They’re organizing behind their condo presidents saying this is a regressive tax on our seniors and demanding that something be done.

What are our options? New Canaan could have asked the State to throw out the entire revaluation if we had a basis to do so. Or, we can follow the process, appealing assessments individually. Four hundred and ten people have filed appeals, a bit more than f years ago (285), but a little lower than 10 (419) or 15 years ago (421).

Here’s the math: In 2013 47 condos sold at an average price of $798,807 and a median of $760,000. The high end was supporting the market with five sales above $1.2 million in 2013 and six sales over $1.2 million in 2012.

In 2018, 46 condos sold averaging, $778,962 and a median of $690,000. We had only one sale above $1.2 million last year. The high-end of the condo market is struggling. Not so at the bottom end, where demand is strong and prices on a per-foot basis constant.

In 2018 condos sold for $417 per foot and 1.56 times their assessments. Contrast this with five years ago, when they sold for $420 per foot and only 1.32 times their assessments. That multiple of assessment is the key. They are selling for a greater multiple versus their assessments. Their assessments had to catch up. Contrast that 1.56 multiple with houses, which are selling at 1.26 times their assessments.

Why are condos selling? It’s a relatively inexpensive way to buy into the New Canaan school system. And, Darien has far fewer condominiums, only about one-quarter the number we have in New Canaan. In contrast to the single-family house market, the condo market is remarkably consistent, four sales per month for the last 10 years, the result of continued demand for workforce housing, entry-level families and downsizing seniors for only 13% of our housing stock.

Munival, based out of Fairfield, (for $222,000) was New Canaan’s choice instead of choosing Ryan or Vision, both out of Massachusetts. Munival also works for Greenwich, Stamford and Norwalk. Darien chose Munis/Tyler Technologies for about the same price, $209,900 (but without a full inspection on their commercial)

Condos are in demand faster than they are being built, prices on less expensive condos are rising, and if we don’t like that we should ask ourselves if our zoning laws adequately address an affordable condominium solution for the next 10 years. That’s the tool we can use. In my professional opinion as a Realtor and based on these values, the current re-valuation is accurate.

The opinions expressed in Chairman’s View are those of Chairman John Engel and not necessarily those of other Town Council members.

Chairman's View: Spoiler Alert. I Like New Canaan's Prospects (April 11, 2019)

Spoiler alert. I really like New Canaan’s prospects. Here are 5 observations taken from the revaluation, the town budget, the state election, and the first quarter real estate sales. There is a happy ending.

1. The uncertainty coming from Hartford is probably worse than anything Hartford will actually do to us. We accept a certain amount of pain is coming and we adjust. But when house-hunters from New York say, “I heard the New Canaan train is going away” or “What’s going on with your schools?” we know the headlines are worse than the reality will ever be. 

2. New Canaan government is working leaner and smarter. Our budget went down .43%, the greatest cut in a decade while improving services. We built new playgrounds, turf fields and gas lines while putting solar on town roofs. Our roads will be new, and our schools will remain #1. Town Hall will sell antique buildings and find a way to co-invest in the world-class library our residents want. Progress is being made on parking, senior & affordable housing and improved cell service. It’s a great time to live right here.

3. The Waveny Conservancy, Land Trust, Library and Athletic Foundation are examples of the high-energy volunteer organizations we have in New Canaan restoring treasures like Waveny Pond with donations, paying it forward.

4. New Canaan real estate is stable. First quarter house sales are up 20% with average prices in the $1.3’s, (same as 2012-2013 & same as Darien). New Canaan is drawing buyers out of Westchester and NYC. (If we speed up the trains, wow, the landscape shifts more dramatically in our favor.) Why is the market recovering from the bottom-up?  75 million Baby Boomers are trying to sell their houses to 66 million GenX’ers (like me, late 30’s to early 50’s) and there are just not enough of us. Be patient. There are 83 million Millennials (23-38 yrs old) who are starting to discover that Texas and San Francisco are expensive. They have to live somewhere. Why not here? We are downright cheap.

5. New Canaan’s downtown is healthy with less than a 5% vacancy rate. A few years ago vacancies were lower and rents unaffordable. Rents are attractive again. P&Z and the new Tourism & Economic Development Commission are responding to changes in the market, giving us the flexibility New Canaan needs to compete in a changing retail environment. Developers respond with exciting new projects all over town. The Grand List is growing again. Consider the new developments built or planned for downtown: Pine Street Concessions, Oxygen, The Merritt Village, a new Post Office, a new Merrill Lynch, new mixed-use on Forest, Locust, Cross and Vitti Streets. Soon look to the corner of South & Elm and for more development on Pine Street to keep the next station to heaven vibrant.

Change is hard. For a town of steady habits that fears change New Canaan is adapting well, improving in so many ways, poised to compete for the next decade and beyond.

Chairman's View: On Bags and Budgets (Feb. 4, 2019)

Chairman’s View: On bags and budgets

FEBRUARY 7, 2019 BY JOHN ENGEL, CHAIRMAN, TOWN COUNCIL

The Town Council is considering a proposed townwide ban of supermarket plastic bags. Letters are starting to pour in. Supporters of the ban cite the environmental impact. Opponents of a ban say we are chipping away at freedom and personal choice.

Greenwich, Stamford and Westport banned the bags; Darien will be next. Will New Canaan’s decision rest on the more successful write-in campaign? Fewer than 25 people have weighed in. We all want to get greener but do we need more laws? We want to hear your thoughts.

The Budget. The First Selectman declared victory this week, proposing the lowest budget increase in a decade, up 0.16%, with two highlights: One is the way we look at contingency, consolidating department contingencies into one account at the town level. The second is a hiring freeze. Both seem sensible. If passed the mill rate will increase from 16.96 to 18.32 this year. Unfortunately, next year our debt service is forecast to rise and I fear the mill rate may rise with it, making us less competitive with Darien and Westport.

Our Superintendent of Schools brought in a school budget, up 2.05%, and believes we are done because they met Board of Finance standards published in the fall. We are not. Board of Finance models were based on changing assumptions. The whisper number from the Board of Finance and Town Council is we need another $1.5 million (from a schools budget that only rose a modest $1.4 million). Sound impossible? It may be too hard to turn the ship in one year. We did not get to this point in one year and we may not solve it that quickly. 

Consider that over the past 13 years spending increased 42% while enrollment was flat. In the last seven years spending increased 24% while enrollment decreased 3%. 

Consider that Darien teaches 4,726 students with 767 teachers and administrators whereas New Canaan teaches 4,113 with 749. If we managed to Darien’s ratio of 6.16 we would have 81 fewer staff across our schools. 

This is not a criticism of our schools or a statement that their budget is “fat” It is not. It is simply recognition that to meet Board of Finance debt targets of debt service below 10% in a period of rising interest rates we will have to make long-term systemic changes. If zero growth is too much in one year then perhaps a 3-year plan growing 1% per year is something the Board of Education and Board of Finance can agree on together. Such a plan would bring the mill rate back to a level below 18, reassure a jittery housing market, provide less stress to our schools than year by year cuts, meet Board of Finance long-term debt guidance and would be consistent with “stable but slightly decreasing enrollment” projections from our demographer.

Chairman’s View represents the views of the Town Council chairman and not necessarily those of any other Town Council member.