Councilman David Bauer is worried about a financial tsunami that could be even more damaging to the city, its grand list and its tax revenue then even the current crisis portends. When Aetna leaves Middletown for good, the financial impact could be devastating, Bauer claims.
"Two years from now we'll feel an impact of a $30 million decrease in revenue over five years," Bauer said Sunday. "Nobody's talking. I challenge anyone, the chamber, city hall, anyone who has a different interpretation of these numbers, to bring them forward."
In an email to city hall staff on January 16, Bauer says:
Correct me if I am wrong, but doesn’t Aetna contribute about $ 8 Million per year in property taxes. Your suggested course of action seems tepid at best. Were we hoping that the problem might go away if we ignored it? The Common Council has a fiduciary responsibility to the City and this potential revenue shortfall eclipses any other budget issue. I am stunned and insulted that hard information concerning our #1 taxpayer has been withheld.
I recommend immediate action by the Council, the Mayor, Finance Director, PCD Director, and whatever outside expertise we need to enlist, to deal with Aetna and this impending revenue shortfall.
They mayor's administrative assistant Geen Thazhampallath replied to Bauer the same day, writing:
Councilman: We assure you nothing was withheld and that the Mayor is working the multiple facets of the issue along with the Chamber President, Finance Director and P&Z Director with the highest levels of Aetna. We'll be happy to meet with you to share any facts and data we have.
Not satisfied, Bauer points to recent information published by Moody's Rating Service which states "Management does not expect an adverse financial impact from the reduction in Aetna Life’s operations." and Standard and Poor's which reports "City officials project that the property Aetna plans to vacate will be quickly redeveloped." Moody's and S&P determine the credit rating for the city.
"I'm really concerned," Bauer said. "And any property owner in Middletown should be concerned. The first thing we need to do is have a workshop. We all have to be working with the same numbers so we can understand the potential impact."
Bauer feels that the city has not moved on the problem with appropriate haste, but that proper planning now could prevent a disaster.
"If we encourage development, it could be a half billion dollar development. It's 250 acres of prime land, with good access to I-91."
Bauer is demanding an immediate workshop.
Bauer writes in an email to the Eye:
We need to actively plan to cover this likely shortfall in revenues or we face a variety of unpleasant possibilities – dramatic cutback of services or property tax increases. We have to face these likely scenarios before we can engage our State Legislative delegation and force every Gubernatorial candidate to take a position on this issue. This situation has another bad effect on the Westfield Fire District because Aetna contributes over 20% of the revenue to the District.