Times are tough for developers seeking financing all over. It’s not just the credit markets that are stuck in paralysis over the exposure of falling dollars, rising energy costs and liquidity meltdowns in mortgage backed securities. Even the state of Connecticut, under a pro business Republican Governor is taking pause on a bill that cropped up authorizing the DECD and CT Innovations to dig around for $25 million for the Waypointe project. The Advocate reports:
Gov. M. Jodi Rell vetoed a bill on Friday intended to help developer Stanley Seligson obtain funding for his long-planned overhaul of West Avenue. The legislation authorized the Department of Economic and Community Development, the Connecticut Development Authority and Connecticut Innovations to find $25 million to help with environmental remediation, building construction and infrastructure for Seligson’s Waypointe project.
Rell said her veto did not reflect the value of the project but called it a “questionable funding mechanism” that “circumvents” the traditional process the state uses to provide aid to community and economic development projects.
She said the bill would give state agencies clearance to divert available funds to Seligson.
“The practical effect of the legislation is to ‘rob Peter to pay Paul’ and to deny funding to other worthy projects in our cities and towns,” Rell wrote in her veto letter to the Secretary of the State’s office.
A Naugatuck redevelopment was also included in the bill.
House Minority Leader Lawrence Cafero, R-Norwalk, and Rep. Christopher Perone, D-Norwalk, both supported the legislation.
“By no means was there any guarantee these funds would be available,” said Perone, a vice chairman of the legislature’s Finance, Revenue and Bonding Committee.
Perone said Seligson requested the bill as a sign of state support for Waypointe which he could then use to attract private investors.
“We bent over backwards to make sure there was no way it could be perceived or taken it was a done deal they’d receive the money,” Perone said. Cafero added DECD often sets aside money for projects that never come to fruition.
“It says if, in fact, they have funds available to them … that this would be considered,” Cafero said.
Rep. Cameron Staples, D-New Haven, helped craft the bill as chairman of the Finance Committee.
Staples said he had initially shared Rell’s concerns and worked to craft the legislation so it would not appear to play favorites.
But Staples also acknowledged that, simply by naming Waypointe in the bill, it might appear the General Assembly was fully endorsing the Norwalk and Naugatuck projects and wanted DECD and the other state agencies to provide funding.
“They would still have to go to the agencies they’re looking for the money from and (the bill) still allowed those agencies to vet the projects and approve them,” Staples said. “It might put pressure on an agency to fund them …There is a question as to why these and why not others? And what does that say to the agencies? Does it put any pressure on the agencies? I can’t answer that question. I don’t know.”
Seligson could not immediately be reached for comment.
Timothy Sheehan, the director of the Norwalk Redevelopment Agency, said the bill was requested by Seligson and city officials were not involved.
Questionable funding and circumvention of process? That certainly is an interesting take by the Governor. It’s strange that once again, we have a bill benefiting Norwalk developers showing up in Hartford. The last time it was the special taxing district with its unique provision that would essentially declare the district responsible for all its own municipal services.
source: Advocate, Norwalk project vetoed by governor: Rell calls Waypointe funding “questionable”, By Brian Lockhart, 06/13/2008
