A private bailout at taxpayer expense
We have always had great respect for Gov. Rell, so the recent announcement that she was about to ask for a $19.4 million bond issue to be used to build an access road and other improvements in connection with the third Fairfield train station gave us pause for concern. It made us wonder whether she was aware of the complete background that had led to her being requested to seek those funds. She should consider the following.
Apparently, Kurt Wittek of Blackrock Realty, the developer of the Fairfield Metro Center project, has once again outsmarted and gotten the better of our state and town governmental authorities at the expense of us taxpayers. The announcement that the state will now spend $19.4 million to complete what we thought were to be the contractual obligations of BRR is yet another example of how Mr. Wittek has been allowed not only to avoid those obligations, but to even have the taxpayers pay to complete them.
It all began with the agreement that Fairfield First Selectman Ken Flatto continually takes credit for having negotiated. It provided that BRR was to remediate the road land that was to connect with the ill-conceived access bridge over the tracks, then build the road and, when completed, donate the same to the town, all at BRR's expense. This BRR obligation and others in the agreement were supposed to be BRR's consideration for the state and town investing tens of millions to provide access to BRR's landlocked property, without which BRR's plans for a mega-sized commercial development would never be possible.
However, paragraph 6.4 (c) of the agreement also provided that if BRR did not obtain a brownfield grant from the state, it would have no valid and binding obligation to perform these improvements on the public portion, as well as other improvements on the project. Well, as we now know, BRR's application for the grant was in fact denied months ago.
The state and the town certainly must have expected that BRR would do this work since neither one of them had budgeted to do it. That being true, it is mind-boggling that our state attorney general's and town attorney's offices would approve an agreement that contained such an escape clause for BRR. Any lay person who could read would have realized that BRR was setting itself up to use none of its own money to perform the improvements it was supposed to do under the agreement. How did this simple realization fail to register with the high-powered state and town officials who were supposed to be representing the taxpayers' interests in negotiating the agreement?
In an attempt to cover-up this inexplicably flagrant error, we are now told that the state has assumed the cost of BRR's work because BRR was hit hard by the economic downturn. But BRR wasn't so hard hit. It had been able to increase its mortgage loan on the site by $10 million in 2006 (for a total mortgage of $20 million), plus $3,750,000 it received from the town for the parking land, and then it did hardly any work on the Metro Center. Why weren't those millions used to build the road we are now paying for? Wittek has even started another huge project in California recently, which also shows he wasn't so hard hit.
So the real reason for the state's gift of our money to BRR is not what we are being told, it's because the state and town have no choice because of their inability to hold BRR liable for non-performance of his promises as a result of their contractual negligence. Wittek obviously knew that once the state began construction of the bridge he could just sit back and do nothing without concern since the state or town would then have to build the road to the bridge -- otherwise the state would be ridiculed for building a "bridge to nowhere."
Proceeding further, we are told the state will build the road to run from Black Rock Turnpike to the access bridge. This means that the road will cross over BRR's property on which BankNorth has a foreclosure action pending. This raises the question as to whether any money from the $19.4 million will be paid to BRR or the bank to acquire the property necessary to complete the road. Wittek would be glad to cooperate with such a payment since it would reduce BRR's mortgage obligation. In that scenario, we would see BRR not only avoiding any obligation to build the road, but having the state pay to do it for him and on top of that reducing his mortgage debt.
The public has a right to know all the details of the current plans for completing the public project, not just the piecemeal statements we are being fed that cause us to wonder how much we are really being told.
It is interesting to note that BRR has suddenly decided to pay back taxes on the property in the amount of some $25,000. Now that it seems clear its property will increase greatly in value as a result of the state's additional $19.4 million investment, BRR wants to be sure it will hold on to its title to the land.
Originally, we were told that the budget for building the access bridge was $38 million. Shortly thereafter we were told that estimate had increased by $10 million. Most likely that figure has ballooned since then. That means the plans for an additional $19.4 million will add up to $67.4 million of our money for this project. If we add the town's contribution and future increases, we can be sure it will cost us close to $100 million for the train station project, which would still be only partially completed according to the terms of the agreement.
We have to ask ourselves if an investment of that size was worth it. However, we do know that it certainly was worth it to BRR since it will have made BRR's private property much more valuable.
All of this lays the blame for the costly mess the train station project has become right at the doorstep of the Flatto administration and that responsibility cannot be avoided.
Commuters should remember these facts when they find themselves slogging through the temporary gravel parking lot; or climbing the "stairway to the sky" to cross over the tracks; or fighting for space on the single small elevator provided for ADA compliance; or waiting in line at outdoor ticket machines in inclement weather because there is no indoor train depot for buying tickets; or stuck in traffic to enter or leave the station. If you want to verify these future discomforts, take a ride to view the project. It's the least you can do since you'll be spending about $100 million for it.
Alexis Harrison is a member of the Fairfield Representative Town Meeting. DeeDee Brandt is a former RTM member who was on the legislative body when the town's original agreement with Blackrock Realty and the state was signed.