Amazon Proposal - A Double Header, Followed by a Single Game

To use the baseball analogy, the Amazon development has a double header today, with both games played at the same time (a split squad, to use a spring training term).  In the Ludlow Room, at 7 p.m., is a Finance Committee meeting regarding a recommendation of an abatement, or to consider changes to the abatement policy.  And, at the same time, in the TC chambers is the Wetlands Commission.

Tomorrow, is the TPZ meeting at 7 p.m. in TC chambers.

Regarding Wetlands, I talked to the Wetlands officer a few weeks back.  My only input was to over involve Bloomfield, since the water run off will go south into wetlands in Bloomfield.  Since I favor the development, I do not want Bloomfield to hold up the project later.

Regarding the Finance Committee, I sent the TC (and some Town staff) an E-mail this afternoon.  It contains an EXCEL spreadsheet summarizing the lifetime of abatements since the fiscal year ended June 30, 2009.  (A copy of the E-mail is below.  If you want a copy, of the attachment,  please call me, and I will forward the spreadsheet to you. My phone number is in the phone directory.  I plan on getting the E-mails of the developer, and Amazon, the tenant, tonight and sent it to them tomorrow.)

Next week's TC meeting on Monday may bring a vote on the abatement to be granted, if any.

(Later, I will update the status of the unfunded $74 million unfunded OPEB liability that I wrote about earlier this summer in Patch land.  I will explain, as best that I can, what this unfunded liability is for post employment medical benefits (read what IBM just announced with respect to what they are doing to their 110,000 retired employees regarding medical coverage. )   Something needs to be done (or Dunn, if you understand the pun - I'll explain later) about this unfunded obligation, sooner rather than later, or never.)

Here is the text of my E-mail to the TC, and others, sent today:

Sorry about sending this out so late.  I was going to send this Friday, or over the weekend, but I did not see an agenda for a Finance Committee meeting until this morning (I looked again as late as last night).  I did not want to send this out too early.

Attached is an EXCEL spreadsheet I've prepared over the last three or four weeks.  It provides a history of the abatements granted to five taxpayers (ING, Hartford Life, Emhart Glass, Walgreens, and Dollar Tree) and three options for Amazon.  It also provides a total property taxes paid section.  If you want, you can modify the three options for Amazon for scenarios that you want to evaluate.  On an actual basis, the spreadsheet reflects fiscal years ended June 30, 2009 through June 30, 2014.  On a forecasted basis, it reflects fiscal years ended June 30, 2015 through June 30, 2023.  It has ten NOTES at the end (on a separate sheet of paper when printed).

Some of the highlights from the spreadsheet:

1.  For fiscal years ended June 30, 2009 through June 30, 2014, the total received for the six projects are $4.3 million, $3.7 million, $4.1 million, $3.8 million, $3.4 million, and $4.7 million.

2.  For fiscal years ended June 30, 2015 through June 30, 2023, the total received for the six projects, will increase by $2.0 million for fiscal year ended June 30, 2015, and then it increases by $3.1 million for fiscal year ended June 30, 2017.

3.  You have approved abatements for three years (Emhart), four years (Dollar Tree), five years (ING and Hartford Life), and seven years (Walgreens).

4.  You have approved constant abatements (Emhart, Walgreens, and ING), decreasing abatements (Dollar Tree), and increasing abatements (Hartford Life - for a later phase?).

5.  Due to the timing of when the projects went into service, the following did not receive a full benefit in Year 1: ING, Walgreens), and the following skipped the first year of abatement in order to receive a "full" abatement in Year 2: Hartford Life, Walgreens, and Dollar Tree).

Some comments about Amazon:

A.  Amazon will be a lease (per the documents in the 9/3/13 TC meeting documents package). 

B.  If you do not grant a level abatement, I would recommend a declining one like 80%, 80%, 75%, 70%, and 70%.  To care of the in-service date not coinciding with October 1, I recommend 60%, 80%, 75%, 70%, and 70%, and then 20% (to make up for year 1 being a partial year).

C.  As John Dunn has advocated, as the abatements for Amazon (and Hartford Life, Walgreens, and Dollar Tree) roll off, please consider using some portion (50% in Year 1 of the roll off, 30% in Year 2, and 10% in Year 3) to fund the unfunded OPEB liability.

D.  With respect to the building permit reduction, and in connection to comment C, grant a 50 percent reduction, but reduce the reduction by $10,000 (or some other amount) which will be used to fund the unfunded OPEB liability.

E.  Like comment D, for the property tax abatement, should the first $20,000 a year not be abated, for five years, so it too can be used to fund the unfunded OPEB liability.

A recommended change to the abatement policy:

A1.  The developer of the Amazon property will subdivide the property into Parcel A and Parcel B.  The abatement policy should be amended so that the development of Parcel B will automatically be considered for 100% of the "normal" abatement as long as the development goes into service within three years of the Amazon property (Parcel A).  Then it would be eligible for 80% of the "normal" abatement if Parcel B is completed withing 4 years of the completion of Parcel A (60 percent for five years out, and 25% for six years out).  This would only apply if the Parcel B project did not otherwise qualify on its own.

A question:

AA1. Is the abatement policy a matter of public record?

A comment about this message:

The EXCEL spreadsheet is on another computer, so I will send this now, and attach the spreadsheet in a few minutes.