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Naugatuck to Consider Tax Abatement Program for Businesses

Businesses that invest significantly in Naugatuck could get a tax break under a proposal being considered by officials.

 

Businesses that are willing to invest in Naugatuck could see an extra incentive to do so.

Local officials are considering a tax incentive program that gives Naugatuck companies, and those looking to locate here, a break on their taxes for up to five years if they invest significantly in the borough. Those who are eligible include businesses that are moving to Naugatuck, constructing new buildings or improving existing buildings.

“For many years, we have struggled, as many communities have, in attracting businesses,” said Mayor Bob Mezzo. “We have many vacant buildings. ...In an ideal world, you wouldn’t have to offer an incentive. But because the way the world works, extra incentives are becoming necessary to help communities like Naugatuck.

“We are not a big city, and we don’t have the demographics of a Fairfield County,” he said. “However, this will give us additional tools in our arsenal to try to entice businesses to come here or to expand here."

He said the borough has had success in luring businesses to the industrial parks because of a state Enterprise Zone tax abatement program that was enacted in the 1990s. That program is for manufacturing and distribution companies only, not general commercial businesses.

Naugatuck's tax abatement proposal, which was drafted by a committee of the Naugatuck Economic Development Corp., would be adopted in the form of an ordinance if approved by the Board of Mayor and Burgesses. On Tuesday, it was given a favorable review by the joint boards of Mayor and Burgesses and Board of Finance.

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The following is a breakdown of what the companies would be eligible for based on their investments:

Cost of Improvements 1st year 2nd year 3rd year 4th year 5th year Term Greater than $3M 100% 80% 60% 40% 20% Up to Five Years $500K to $299.9M 100% 50% 0% 0% 0% Up to Two Years $25,000 to $499.9K 50% 25% 25% 0% 0% Up to Three Years
SuperDave October 10, 2012 at 01:01 PM
So companies get a tax break, we the people get to pay more taxes. There better be much more to this than what is written. This happens all the time: Companies move in. They get tax breaks that do not come close to covering the real tax liability. Therefore the taxpayers in town pay more for the ownership of companies to save on taxes, thus make more money. Then the abatement ends, and they move away! I guess its better than zero in the short term, but there must be a better way. What way is that? CUT SPENDING IN TOWN, TAXES LOWER, BUSINESSES ARE ATTRACTED! BUt we never think that way. We just look for more ways to take more money from taxpayers while preserving the same old obsolete government configuration.
Rob October 10, 2012 at 01:49 PM
Lets do some tax breaks for the little guy. Those that hire 5 or 10 unemployeed local people. The ones that can barely keep their business going but suffer to keep their people employeed until the economy picks up. How about helping them out
brutus October 10, 2012 at 02:35 PM
awesome. just got a letter in the mail yesterday letting me know my mortgage payment was going up. guess why? that's right, property taxes went up. funny how my house has lost so much value the last few years, yet my taxes keep increasing. and don't even get me started on how much property taxes I have to pay on our cars. WHERE'S MY TAX BREAK!?!? and look, I understand the greater significance of this. if we can attract more business, that would increase the town's tax base, and theoretically that should translate to some tax relief to the homeowners. but does anyone believe that the town will lower our mill rate if taxes from businesses goes up? or will they just find more ways to spend it all.
Silence Dogood October 10, 2012 at 05:31 PM
The Republicans are always crying that the Democrats want big government, they are socialist and want everything for free, another welfare program. Well here we go again with business needing a hand out, talk about a socialist program. Both side of the aisle are in it for themselves, none of them wants to fix the issue and provide a solution. We are a society that is always looking for something for nothing when it helps us. Let's get our act together and make our tax system fair for everyone, stop the games. If you can't make money without paying your taxes you should not be in business. If you don't go to work then you should not get paid. I realize it is not that simple but where is shame looking for something for nothing, we reward bad behavior.
Mr Mike October 10, 2012 at 06:42 PM
I agree with the first 3 comments. Residents of Naugatuck have their homes and cars valued much too high by the town compared to what they can be sold for. Also, too much money was wasted on the ill-conceaved Renessance fiasco. Who benefited from that I'd like to know?
Jimmy Ayash October 10, 2012 at 06:44 PM
I don't like my taxes increasing every year, in fact it upsets me that I might not be able to afford them one day, currently my yearly taxes are about 35% higher then my social security would be. With that said, I do like a plan to get more work in our city, I say we supported our elected leaders sometimes and not handcuff them for every idea that they got. I do think the 25K number on the chart is to low, maybe 50 or 75 or 100 to start and that will help eliminent anyone that has a special interest in it if you know what I mean. That being said, comedown and have a burger, I am currently serving great food in town and very proud about creating my own job in the same town I live in.
Naugatalk October 10, 2012 at 06:57 PM
Just a reminder Silence : The Democrats are running this country state and town .... are you one of those who always blames the Republicans for all the misfortunes that happen ? The Democrates run this state and its going right into the ground. The business climate for small business in this state is disgusting and getting worse. Is there any hope for a fix..? not as long as the dumacrats run the show.
Silence Dogood October 10, 2012 at 07:09 PM
Naugatalk, you missed the point. Both parties have their own agenda and none of it is supportive of the majority of American. Why do you feel business needs a tax cut at the expense of property owners? Cut taxes for all. Good luck with the party of blame they are both the problem!
Naugatalk October 10, 2012 at 09:13 PM
Small business people don't usually get the perks that those in big business and government jobs receive. A single proprietor pays double on his social security since he is his own boss. Double taxation there is one example. Those of you who work in corp get your share of SS and Medicare taken out of your pay but your boss pays the matching amount also I was surprised that some folk didn't know that. If something is broken fix it before it isn't fixable . Get the real facts then go Vote.
Silence Dogood October 11, 2012 at 12:05 AM
You are still not getting it, your asking for a hand out. If your issue is taxation then lets work to fix it, not give out more freebies. Unfortunately there is not a Reb. or Dem that really wants to change the tax code so it is fair. A sales tax on everything (no exceptions), touches every dollar in the economy.
brutus October 11, 2012 at 03:44 AM
Silence, you're right. unfortunately the vast majority of americans resign themselves to the two-party monopoly. a sales tax on everything (the "fair tax") isn't a horrible idea, and certainly better than what we have now, but it's far from "fair." the current fair tax proposal calls for a much too high sales tax while doing nothing to address state and local sales taxes, income taxes, property taxes, etc. and even better than the fair tax, I support the land value tax (LVT) as the only tax we should pay. but this is a different discussion for a different forum. our mayor can't control what our federal and state tax code is....he can only do what he can do to woo business to come to Naugatuck. can't fault him for thatQ
Silence Dogood October 11, 2012 at 08:55 PM
Brutus, great to here your viewpoint but I disagree. I'm for one tax and that is a sales tax as it cover every $ in the economy, including the black market (drug trade, under the table cash payments etc.). The LVT is subjective and look at the games that have been played with the housing market. Yes some of that could still take place but not on the level that it would with LVT. Remember a sales tax on everything, business or personal, steel or milk. Everyone pays, no exception!
Mr Mike October 11, 2012 at 11:58 PM
Silence Dogood, Sales Tax is an option, but it is not totally fair. People making less money will pay a larger percentage of their income to obtain the basic things needed to live - shelter,food,clothing, etc, leaving them less discretionary income to spend on other things.Also, do you really think the drug dealers and other illegal bussiness people are going to declare and pay sales tax on their illegal income? I prefer a flat tax on all income regardless of source, including dividends, interest from offshore investment, rental income, stock sales or receipt in lieu of wages, etc. If you live here you pay taxes on everything you get coming in no matter where or how it is generated. Then we could formulate a method to distribute it fairly, and eliminate all other taxes.It won't be easy, but it can be done.

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