RE:  COMMERCIAL ZONE ON UPPER WASHINGTON STREET
        ANOTHER PERSPECTIVE ON POTENTIAL TAX BENEFIT 
 
 

     In recent discussions with both Council members and candidates, it has become rather apparent that some have been led to believe that a 3-acre project in this area, consisting of three buildings covering approximately 25,000 square feet, could deliver some $ 250,000.00 in tax benefits to our city.  This prompted a cursory review of a complex on Route 82. This complex, consisting of a Big-Box store and a grocery store, occupies some 195,288 sq. ft. and sits on 29.98 acres.  It delivers $207,080.00 in Real Estate taxes and $68,068.00 in Personal Property taxes, for a total of $275,148.00.  The disparity in these figures initiated a more in-depth review of assessor records.

     As you are aware, taxation for commercial structures relies on three basic evaluating factors: Income approach, Market value, and Comparisons to similar businesses.  In addition, taxes on Personal Property become part of the equation.  And, since there are no leaseholds available or structures built to assign value, it would seem prudent to utilize Comparisons to similar businesses to formulate a relative tax projection.  As I have not been privy to any renderings,  I have based the following information on the three businesses often mentioned;  a 20,000  sq .ft. chain store,  a free-standing bank and  a coffee shop, to comprise the remaining  5,000 sq. ft.

     This page contains a summary of those findings gleaned from public tax records. The following page quantifies the records reviewed for comparable tax returns to support the projections.

     It should also be noted that 24 homes between Arnold Place and Julian St. provide

$ 83,679.88 in taxes to our city for an average of $ 3486.00. Each home razed, 6, 8, or 10, results in a $3500.00 tax loss. The remaining perimeter homes could conceivably lose some

25-40% market value, and they would surely pursue assessment appeals. Taxes lost per home at 30% reduction would equal $1050.00 each…12 homes granted = $ 12,500 lost, 24 homes granted = $ 25,000.00 lost.

     I acknowledge the possibility of inadvertent omissions, and that some assumptions were made. Argument is welcomed,  for the records researched  are current and available for you to review and evaluate.  I courteously solicit a few minutes of your time to assess their validity  and impact on your eventual position.  Please know that this exercise was undertaken to challenge the premise of  “Economic Opportunity for Norwich”,  and to question the ultimate value of what has been suggested as  a  “ Tax Relief for all 39,000  Tax-Payers” . 

      COMPARATIVE TAX BENEFIT PROJECTION:                                                                        

     Bank                       $ 24,000.00                      Raze 8 houses          - $ 28,000.00

      Coffee Shop            $ 16,000.00                      Appeals 18 houses   - $ 19,000.00

      Chain Store             $ 40,000.00                      Potential tax loss      - $ 47,000.00                

      Sub-Total                $ 80,000.00                     Net Tax Benefit         $ 33,000.00