Future of New London’s riverfront still in question
By Robert Cloud
New London Common Council members are reviewing their options for developing the city’s downtown riverfront property.
They met as a Committee of the Whole on Wednesday, Aug. 5, to discuss the project and its financing.
City Finance Director Judy Radtke explained how the development could be funded and the limits to New London’s debt capacity.
She said if the city wants to keep its interest rates low, it should have no more than $13.6 million in debt at one time.
“Financial consultants say don’t go beyond that point or bring it back down within two to three years,” Radtke said.
Currently, the city has about $8.6 million in outstanding debt.
The city can afford to take on about $4.7 million in additional debt, she said.
Radtke then referred the aldermen to a capital projects priorities list she put together after speaking with department heads.
That list includes construction on Werner Allen Road and Oshkosh Street, new roofs on at least six municipal buildings and a new tanker for the fire department.
She estimated New London would need to borrow about $2 million for priority projects, which leaves about $2.7 million for other projects.
Radtke noted the city’s debt capacity will increase over time.
First, New London’s total equalized value increased from $19 million to $20 million over the past year.
“If equalized value goes up, debt capacity goes up,” Radtke said.
Also, as the city pays off prior debt, it can take on new debt.
By 2024, New London may be able to borrow up to $5 million.
Ald. Fred Zaug asked about potential decreases in state shared revenues and the city needing to cover more of its expenses from local taxes.
“We’re going to be spending more of our own money from our tax receipts,” Zaug said.
While noting the uncertainty of future state revenues, Radtke said the city needed to control its expenses.
“We cannot have any increases in operational expenses,” Radtke said.
Among the difficulties with maintaining zero operational budget increases are health insurance costs.
Radtke projected a 16% increase in the city’s health insurance costs.
She also noted there will be future high-priority projects that will require bonding.
“We have streets we need to take care of. We have infrastucture we need to take care of,” Radtke said.
Riverfront development
Todd Hutchinson, who is consulting the city on the riverfront development project, told the council members, “The city needs a minimum and a maximum of what it is looking for on the site.”
“We have a lot of ideas out there, but we have no idea of what we’re doing,” Mayor Mark Herter said.
Hutchinson said he would review and summarize past housing studies the city previously commissioned, but he said the studies were more of a historical snapshot of New London’s housing market.
The city may choose a development plan that is not based on past marketing studies.
“Sometimes you create your own market,” Hutchinson said. “Somebody can have a vision and come in and drive the market through marketing, outreach and community support.”
Ald. Dave Morack said the council must decide its target audience for any new housing development.
“Do we want to attract young workers or are we happy with rich, older people coming in?” Morack asked. “Do we want town houses or affordable housing? What’s the preference of this council?”
Morack said, “Affordable housing can go up in a cornfield. We want to take advantage of the river.”
He also noted local businesses need more employees, saying Tyson is down 100 workers.
“We’re not going to attract business to New London if they don’t have workers to hire,” Morack said.
Herter said younger workers also like the concept of a town house. They are less likely to own a home due to maintenance.
Library
The city still does not have a clear design or plan for a new library.
Ald. Dave Dorsey said he does not see how the city can pay for a new library.
“How can anybody look at our numbers and think there’s any chance we have even $2 million to put toward the library at this time when so many people are complaining about the roads?” Dorsey said.
Dorsey suggested the city first develop the riverfront and generate tax revenues that could help cover the new library’s construction costs.
Library Director Ann Hunt said everything has been put on hold for several months, so there is no design, no plan and no ongoing efforts to raise funds.
In 2018, the city considered a three-story building, with the library on the main floor and senior housing on the two upper floors.
The library hoped to raise about $3.5 million in private donations for the library portion of the project, while a private developer would use loans and grants to pay for the remainder of the building.
The project stalled last year.