Is it possible to stimulate business growth in Hartford? Is there any hope for real "economic development" with a mill rate almost 30 mills higher than the next closest Connecticut city, New Haven at approximately 43 mills?
One of the challenges in running for Hartford City Council is trying to figure out what to do if I am successful in my campaign and actually get there.
One of the things that I think is necessary is a plan that will actually allow us to compete with other towns to attract business back to Hartford. What business owner would locate or start a new business in Hartford with a tax rate of 73 mills when they could travel probably a mile in any direction and see their tax rate almost half of that in our neighboring suburbs.
I know this plan would need a lot of work, but Hartford has had a history of giving tax breaks and incentives, primarily for large corporations, to move into Hartford. But shouldn't that also be done to encourage more small business development. The reality is that small business, typically the businesses with under 50 employees, are the engine that drives any City, not just Hartford.
As an example I use Sunshine Laundry on Maple Avenue. Sunshine Laundry employed probably over 40 Hartford residents, many of whom actually walked to work from the surrounding neighborhoods. After a devastating fire, Sunshine Laundry did not rebuild on their site primarily because the property taxes on a new building would have killed the business's profit. The owner actually looked at properties outside of Hartford and considered moving his operation to a neighboring town where the taxes would be close to half of what they are in Hartford. The fire site is now basically a vacant lot and the business operates out of a few storage sheds on Prospect Avenue, near the West Hartford town line
Now my question. Does it make sense to develop a program that any business willing to move into Hartford, or anyone starting a new business in Hartford, and willing to make the commitment to hire Hartford residents would receive a tax abatement to equal the mill rate of comparable suburban towns? This would hopefully make Hartford able to compete with Windsor, Bloomfield, West Hartford, East Hartford and every other town that is willing to make the effort to lure small business away from our City.
I would probably prefer to see the abatement's issued only on new construction or for abandoned or vacant buildings not currently generating revenue for the City, but that could be open for debate. I guess my thinking is that nothing times nothing is still nothing. If we were able to convince businesses to take a chance on Hartford while only asking them to bear the tax liability they would incur if they started in a suburban town, I think that would at least give them a reason to consider Hartford.
Hopefully at the end of the term of the tax abatement, whether 5, 7 or even 10 years, Hartford will have its act together and the Grand List will be growing, the mill rate will be decreasing to a competitive rate and a lot of our vacant businesses will be occupied by companies that can compete and are committed to Hartford.
I know it is just a thought, but let me know how you would tweak it or if you think it would even work at all.
Very interesting! Most certainly worth exploring for those small businesses with 50 or less.
ReplyDeleteI think it is a step in the right direction. But I also think you need to consider the potentially higher insurance costs and/or security costs they have to pay to operate in Hartford, due to the high crime rate. Taxes are one reason not to open a business there, the chance of getting robbed every other day is another one.
ReplyDeleteI largely agree with Kevin, he is on the right track.
ReplyDeleteKevin, you would need a change in state law to do this, which is possible, though not a certainty. The permissible abatements are set by statute, so you would need a modification to existing law to do this. It is still a good issue for a municipal official to advocate for, but you're going to need help at the General Assembly to actually make this happen.
ReplyDeleteHartford will have its act together and the Grand List will be growing
ReplyDelete----------------------------------
Kevin:
Your suggestion, "...tax abatement to equal the mill rate of comparable suburban town...," on the right track. Implicit is a recognition that taxes are a necessary evil, all other things equal, damaging to the city because tend to drive folks out towards lower tax districts. Also implicit is the assumption that profit-making businesses are desirable. As opposed, however, to picking winners (businesses hiring residents or doing new building), I'd simply cut tax rates across the board.
But, either way, since Hartford can't print money balancing the budget with tax cuts requires spending cuts; i.e., Hartford's getting "its act together." Unfortunately, even if there were a clamor for cuts, the bulk of the budget is off the table because it's School District. Further, even if we were to cut taxes (and don't get me wrong, it's the best we can do), there are a ton of other factors alienating potential immigrants, factors related to Hartford's having been relegated by the State to ghetto status for decades now. (See anonymous @10:19.) But, now that I've thrown a wet blanket on it, let me re-iterate; cutting taxes on business is an attractive notion.
Rich,
ReplyDeleteI'm being told we already have the authority, but I guess that is what we have Corp. Counsel for.
If the State can give $71 million to CIGNA to create 200 jobs, I think we could do a lot better with a lot less.
I have received quite a few phone calls about this post and everyone thinks it is a great idea and something that needs to get started.
I like this idea a lot. It is proactive. We need more businesses and we need more attractive businesses. There are tons of small plazas in this city that look like hell. Its all about enforcing ordinances saying we mean it. There are tons of bodegas that sell expired food and do not comply with health and safety codes. A good business does not want to open up shop next to a bad business. Sunshine Laundry was a force on maple avenue. We can not allow these type of companies to walk away. I think maple avenue has great hope and looks good for the most part. I would love to see franklin have a little more consistency and help. They were once shining. Bring back our avenues. All of them. Start a clean the avenues program. You can have Hartford business adopt an avenue or other community groups and have quarterly clean ups scheduled. There are endless possibilities to get back on track.
ReplyDeleteI don't know what to say, someone actually ruuning for Office that has an original thought rather than more empty promises. And a thought that really seems to make some sense.
ReplyDeleteCan it actually be a sign of change for the way Hartford is run?
You have my support Kevin.
Kevin, there is an abatement statute (actually, I believe there are two) and it outlines the permissible forms of abatements. I don't recall seeing anything like this being authorized. If someone shows you a section in the General Statutes that would permit this, please share that citation.
ReplyDeleteKevin,
ReplyDeleteGreat idea and my office would love to work with you on the creation and implementation of this concept.
Treasurer Adam M. Cloud
I think it would be a good idea, but it would anger existing businesses to see a newbie get tax relief while they've been suffering all these years.
ReplyDeleteCutting taxes across the board would be the only way to keep other businesses from leaving.
Anonymous, 3:42PM :
ReplyDeleteI agree, that is also something that needs to be worked out since the businesses that have been loyal to Hartford may not be able, or willing, to wait to see the results of a tax decrease five or more years from now. Maybe some sort of incentive to add new jobs that would allow them to be part of the incentive program. I'm sure with a few minds working together we can come up with an acceptable program.
Adam,
ReplyDeleteI have to say at first I was reluctant to open your comment figuring it would be a typical City Hall response with a 101 reasons and excuses why this wouldn't work.
I am pleasantly surprised by your attitude and hope this will become the attitude at City hall for everyone after the November elections. Your "let's get it done attitude" works for me and it is the attitude we need to move forward.
As my campaign slogan says "No more excuses, it is time for results". With all of us working together to accomplish what is best for Hartford is what will change this city for the better
Kevin,
ReplyDeleteI am not your typical politician and my focus is and will be to make the city that I love better by being a resource and a partner to all of its stakeholders.