Darien discusses tax abatement for Allen O'Neill project

As part of a project to increase the number of units available at Allen O'Neill, the Darien Housing Authority presented a tax abatement agreement that would give the project time to stabilize before paying taxes.

Currently, the AON maintains 56, units but the new project would increase the capacity to 106 units, according to a memorandum from the Housing Authority. The memorandum stated the Town had received $70,000 in PILOT money (payment in lieu of taxes) in the past for the 53 units and could expect to receive about $106,000 for the 106 units at the new AON. However, the memo says the payments would most likely end once construction of the new AON is completed.

Housing Authority Chairman Jennifer Schwartz presented the agreement and outlined the potential impact on the town.

"In short, the reason for the tax abatement is to help the project in the early years," Schwartz said. "One of the key aspects of the operation is the assumption that all the existing tenants will be coming back."

Schwartz pointed out that the town has an existing policy of granting abatements but acknowledged that once the project was completed, the town would be unlikely to receive any PILOT money.

As proposed, the AON project would be exempt from taxes through the construction phase plus the first five years of operation, Schwartz said. The property would start paying full taxes by the 15th year, Schwartz said.

"Eventually this property will pay more taxes than it ever has," Schwartz said.

Republican Selectman Gerald Nielsen questioned why the AON project couldn't start paying taxes sooner. Schwartz said there wasn't any reason AON couldn't start paying taxes sooner because the Housing Authority was using assumptions to determine a timeline for the project.

Democratic Selectman Callie Sullivan questioned whether there was a connection between the years of tax abatement and more moratorium points.

Schwartz said the Housing Authority anticipates about $1,000 per unit in taxes and that Allen O'Neill Drive would be included on their application.

"There is," Schwartz said, "but you would be looking at about one more point. A point's a point," Schwartz said. "We're in a position where we can be more competitive."

Nielsen also asked if there could be any improvements made to the building while the new units are being constructed.

"We had an Oct. 26 public meeting and we discussed building materials," Schwartz said. "The money we can lever will go directly into construction."

Schwartz noted that curb appeal is an important aspect for both tenants and the town.

"If there's a chance for an upgrade, we'll do an upgrade," Schwartz said.

Democratic Selectmen David Bayne asked why the construction period seemed so vague and wondered if there was a specific construction period.

Schwartz said the project must be completed within two years because once the current tenants are relocated, they must be able to move back in within one year.

"We can't do it in more than two years," Schwartz said.