Residents Worried About Financial Viability Of Storrs Center Project

With thunderclouds of economic uncertainty gathering, a mood of caution has descended on the dream of building a downtown where this rural town and the University of Connecticut campus meet.

The $220 million Storrs Center plan for a vibrant village serving residents and students alike has been hailed as a model of urban center planning that has grown out of a unique partnership of town, university and business interests. The Mansfield Downtown Partnership just picked up a community consensus-building award from Connecticut Main Street Center and $10 million in state bond money for a parking garage.

The developer, LeylandAlliance, is upbeat about the project's prognosis.

"We wish we had a few more Storrs Center projects in our portfolio," Howard Kaufman, Leyland executive vice president and general counsel, said.

And, yet, as the project awaits a delayed groundbreaking, some residents are worried about its viability in a down market and fret about a proposal for the town to make a low-interest, $3.7 million loan to help the developers build a relocation building for existing local businesses and keep the starting rents low.

The town manager has required an update on the downtown project's status and is hiring analysts to look at the financial prospects before the town decides on a capital investment.

"It's not an easy thing to create a downtown from scratch," Mansfield Town Manager Matt Hart said last week. "We certainly do have a great partnership with the university and we've selected a stand-up developer in LeylandAlliance, but my responsibility is to the town and to make sure the town's interest is protected."

The issue is hot enough that it prompted a motion at a May town meeting to cut downtown project money out of the budget, a flurry of letters to the local newspaper and a petition forcing a referendum Tuesday on the proposed budget.

Camille Lavieri Forman, a 50-year Mansfield resident, wrote in a letter to the editor, "Why are the taxpayers in Mansfield being expected to pay for a new 'downtown' Storrs NOW? Mansfield taxpayers will be responsible for the bonds issued. Next, tax rebates will be expected by any private developer. And the town of Mansfield will have to pay to move the present tenants.

"WAKE UP AND VOTE NO to any more funds for this illusion."

Under new charter rules, the referendum is only advisory, and the push for townwide approval may be due to overall spending concerns about schools and town services as much as it is about the downtown issue.

In the 2008-09 budget, $125,000 is budgeted for partnership operations, $50,000 for legal and financial consultation and $293,000 in bonding for a 20 percent match to $1.2 million in federal funding for Storrs Road and streetscape improvements.

Partnership, town and university officials are solidly behind the downtown dream. In the first eight years of the project, the town and university have spent more than $500,000 each.

"This new downtown is badly needed now and for the future vitality of the town of Mansfield and the University of Connecticut," Mayor Betsy Paterson and UConn President Michael Hogan wrote in a joint commentary piece published recently in the Willimantic Chronicle.

The Mansfield Downtown Plan approved in 2002 calls for about 15 percent of the project to be financed with public money. About a $15 million gap remains. Most of it is needed to pay for a second parking garage, the developers say.

Kaufman says any investors Leyland approaches, including some in the last two weeks, express eagerness about Storrs Center.

"I think that money will be available even in the current climate. A year from now, pretty likely our start point, things will be better. I really look forward to that. We've got interest right now, good strong interest," he said.

The Mansfield Downtown Partnership and developers from LeylandAlliance updated the town council on June 12. Tonight, public questions and comments will be sought at a 6 p.m. special meeting in the council chambers at the town office building.

The downtown plan includes a mix of retail, entertainment, offices and residential units on about 48 acres, 30 of which will be preserved as open space. Public squares will afford meeting space and entertainment events.

A 2005 cost-benefit analysis projected that when complete the development would yield $2 million in local tax revenue, a figure Hart says is conservative, and about 900 jobs. Leyland will update those projections this summer, and the town will have them reviewed.

Town and development officials agree that the first step, groundbreaking on the relocation building for existing businesses, probably won't happen until mid-2009. The project awaits a few permits from state and federal agencies and the financial analyses from Leyland and town consultants this summer.

After a period of negotiation, the parties hope to have a proposal to the town council by the fall.

Kaufman projects that the project's four phases will take eight years to complete — 2018 if ground is broken a year from now.

Leaders at Leyland, who point out that Rockefeller Center was built during the Great Depression, say it's common for a long-term development to undergo peaks and valleys in the economy.

"You have these periods where there's a great year for the project and there's a slow year," Kaufman said. "You plan for that by financing it conservatively."

Contact Stephanie Summers at ssummers@courant.com.

http://www.courant.com/news/local/ec/hc-stocenter0622.artjun23,0,6781497.story

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Residents Worried About Financial Viability Of Storrs Center Project