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State Would Purchase Hartford Parking Garage For Worker Relocation Plans

by KENNETH R. GOSSELIN

April 09, 2013

The state would pay the city of Hartford $23 million in a proposal to buy the underused Morgan Street Garage, parking that is needed for state workers who will eventually move into the nearby Connecticut River Plaza, the state’s budget director told me today.

The agreement also requires the state to pay the city $3.2 million over four years to obtain a 99-year lease for the land under the garage and rights to future development above the eight-level structure, according to Ben Barnes, the secretary for the state Office of Policy and Management.

Barnes said the state needs “a couple thousand” spaces to accommodate the workers that will be moving into Connecticut River Plaza, which is the state is buying. The twin-towered complex on Columbus Boulevard has parking for just 800.

The state already has a minority ownership stake in the property, contributing to its construction.

The $23 million would pay off the debt on the property tied to initial construction and subsequent improvements, Barnes said.

The state would honor existing monthly parking agreements and keep the garage available to the public as much as possible, Barnes said. Some of the spaces also could be used if the University of Connecticut chooses as site nearby for relocating its West Hartford campus to downtown Hartford, Barnes said.

The purchase and lease is another proposed agreement with the state that would benefit Hartford. The city stands to lose property tax payments now that the state is taking ownership of two major office buildings in the city.

In addition to the garage proposal, the city also is considering leasing the XL Center to the state in exchange for annual payments.

Both agreements require city council approval and are scheduled for public hearings April 15.

The 2,290-space garage was opened in 2002 and had a 90-percent, monthly occupancy when UnitedHealthcare was the anchor tenant at Connecticut River Plaza. When the health insurer moved to CityPlace in 2010, the monthly occupancy was cut nearly in half.

“The facility is uniquely tied to Connecticut River Plaza, its occupancy and who works there,” said Mark McGovern, chief executive of the Hartford Parking Authority, which is responsible for managing the facility.

The garage now has a monthly occupancy of 53 percent, up from 47 percent a year ago.

My colleague Jenna Carlesso previously reported that the garage has brought in the least revenue of the Hartford Parking Authority’s three facilities, which include the Church Street and MAT garages.

This year, the Morgan Street garage was expected to bring in $979,900 and cost $617,560 in upkeep and other expenses, leaving a profit of $362,340, according to Jenna’s review of city documents.

By contrast, the MAT garage is expected to bring in about $2.1 million and cost close to $900,000, leaving a profit of $1.2 million.

The city is facing the loss of about $2 million in property taxes now that the state is taking ownership of Connecticut River Plaza and another office building, 55 Farmington Ave. in Asylum Hill. The state doesn’t pay property taxes for buildings it owns in towns and cities, but has compensated municipalities through its PILOT, or “payment in lieu of taxes” program.

Gov. Dannel P. Malloy has proposed eliminating the PILOT program, but cities such as Hartford are pushing to keep it in place. The legislature has not acted on Malloy’s proposal.

Hartford is trying to close a $70 million budget deficit for the 2013-14 fiscal year.

Jared W. Kupiec, chief of staff to Hartford Mayor Pedro E. Segarra, said the parking garage agreement would relieve the city of paying off the debt and bringing much needed dollars to the city budget.