City officials in Rutland are urging residents to approve a $3.9 million bond on Tuesday, Oct.7. They argue the money is vital for new downtown development and housing.
The funds will enable the city to bury power lines and replace aging water and sewer infrastructure underneath Center and Wales Streets, according to Ed Bove, Rutland City’s planning director.
“Because without those infrastructure upgrades, [the current system] cannot support development like a hotel," he said. "It cannot support the development of some of the upper floors of our downtown buildings because of the water pipes being from 1880 that can't support modern day fire suppression systems.”
Developers hope to build a seven-story, mixed-use building on the corner of Center and Wales Street that would feature a 99-room hotel, 26 market-rate apartments, a restaurant and rooftop bar.
The historic Berwick hotel had stood on the site from 1868 until 1973, when it burned down. It's been vacant since and is known locally as the "pit."
The proposed $35-40 million building project would transform the city's downtown and send a clear message that the city is ready for new development, said Rutland City Mayor Michael Doenges.
"This bond vote is an opportunity for the entire city to say, 'Yes, we want to see growth,'" he said.
Besides the underground infrastructure upgrades, Center Street, where the Paramount Theatre and a number of restaurants, cafes and other businesses are located, will also undergo a makeover.
New streetscaping is planned, along with traffic flow and parking changes. The city announced this summer it had won a $3 million grant to help pay for this work from the Northern Borders Regional Commission.
All of this combined, Doenges said, is the culmination of several years of work to make the city ready for new development.
Some residents have concerns about the city taking on debt right now, like Bob Haynes. As someone who is retired and living on a fixed income, he said he doesn't want homeowners like himself left on the hook.
But local homeowners won't see their property taxes impacted by the bond, Doenges said, because the renovations will be made in a specially designated downtown area known as a "TIF" district.
The city won state approval for the designation this summer.
TIF stands for Tax Increment Financing, and it’s a tool that municipalities can use to finance expensive public infrastructure projects like streets, sidewalks and water systems.
The idea is upgrades made within a TIF district will increase the value of the property and encourage private development. So any new restaurants, apartments, shops or hotels built within the district will add to the city’s grand list. For a 20-year window, up to 70% of the increase in property tax revenue generated within the district will be kept by the city to pay back the bond.
"So while some taxpayers may be concerned about the debt load that the city is going to have, you know, we have guarantees from before we take that money out from this project developer, that we're going to see those tax revenues for the next 20 years," Doenges said.
Rutland resident James Tibbits admits he's not sure he understands how the TIF district works. But he said he likes the idea of revitalizing Rutland and thinks a new hotel would bring in more outside consumers and help the downtown. He plans to vote "yes" on the bond.
So does David Balfour.
"Particularly since part of the hotel is going to be designated as housing which we really need," he said.
"People are always nervous about spending money," Balfour added, especially when it's in the millions. "But you have to invest in order to get a return, and I think this is a wise investment."
