Date: Fri 30-Jan-1998

Publication: Bee

Author: STEVEB

Quick Words:

council-Neumade-tax=break

Full Text:

Council Tries To Sort Out Confusion Over Tax Break Deal

BY STEVE BIGHAM

Ronald Jones of Neumade Products claims the town promised him his company

would receive a tax break if it moved to town.

The firm is now fixed at its new address on Pecks Lane, and the owner is

looking for his five-year tax deferral. There's a problem, however.

Town officials say they never actually promised the company anything. They

claim they simply informed Mr Jones that the town was working on a plan that,

if approved, would provide Neumade products with what would amount to a

savings of more than $70,000 per year for the first five years.

First Selectman Herb Rosenthal is not a fan of tax deferrals, saying they do

not necessarily work to the town's economic advantage. Neither are many

members of the Legislative Council. Town officials, who say they only recently

learned of this supposed "deal," must still make a decision on whether or not

Neumade Products will receive the tax break. A "no" vote may look like the

town is going back on its word.

Trying to determine what was or was not promised, the Legislative Council's

finance committee met with both Mr Jones and the town's community development

director, Liz Stocker, Monday night. Mrs Stocker explained to the committee

that, during informal discussions, she and then first selectman Bob Cascella

told Mr Jones that the Board of Selectmen did approve a regulation that would

allow for certain tax breaks -- with council approval. Nothing was ever signed

between the two parties. There was no authorization to do so.

"You don't make promises. Neither myself nor the first selectman is in a

position to make promises," Mr Stocker said last month. "As far as

expectations go, I can't answer that. You'd have to speak with Mr Jones."

Last year, members of the Economic Development Commission (EDC), seeking an

ordinance, presented the tax deferral program to the council, but never

returned after council members asked them to refine certain sections of the

proposal. The Cascella administration then passed a resolution supporting tax

breaks two months later, a move that came as a surprise to the council, which

was still awaiting word from the EDC. Now, both Mr Cascella and most members

of the EDC familiar with the issue are no longer in office.

Council members aren't sure what to do now.

"I think it's fair to say that Mr Jones discussed the issue of deferral in

good faith," said John Kortze, finance committee chairman. "He did express

that, to his understanding, he would get something. Quite frankly, I have a

problem with us doing anything that would adversely affect our relationship

with him (Mr Jones). It's not his fault that we don't have all our ducks in

order."

Mr Cascella has adamantly denied making any promises to Neumade Products.

The town will still receive tax revenue for the Neumade equipment.

The EDC created the tax incentive program last year in its effort to lure

light industry in to town. The program uses a formula to give selected

industries tax breaks for the first few years as an incentive for locating or

expanding their facilities in Newtown.

Neumade Products produces sheet metal cabinetry for the TV and movie

industries.