Thomas Breen file photo
Acting Assessor Pullen: Broke news at budget hearing.
Nearly 60 percent of city real estate value is currently off the tax rolls, now that New Haven’s tax-exempt grand list has climbed by another nearly $200 million last year to reach a new peak of $8.47 billion, the city’s top property-monitor revealed Wednesday night..
City Acting Assessor Alex Pullen gave that update Wednesday night during the latest Board of Alders Finance Committee meeting, which was held not in its usual meeting place on the second floor of City Hall, but instead in the Hillhouse High School auditorium on Sherman Parkway.
The meeting was the first public hearing that the aldermanic committee has held since Mayor Justin Elicker submitted his proposed $569.1 million general fund budget for Fiscal Year 2020 – 2021 (FY21) earlier this month.
City of New Haven
Pullen explained at the top of the meeting that there is an inextricable connection between the city’s grand list — the total combined value of all real estate, motor vehicles, and personal property in the city — and the city budget. That’s because the general fund budget derives roughly half of its revenue from local property taxes.
Handing out two pages’ worth of charts and data to the alders, Pullen said that last year saw the continuation of a grand list trend that has defined at least the past six years in this city: the ratio of tax-exempt properties to taxable properties has tipped, further and further, towards the former.
Tax-exempt properties are those owned by the state and a variety of nonprofit entities, including Yale University and Yale New Haven Hospital.
City of New Haven
Pullen said that tax-exempt real estate in New Haven increased in value by roughly 2.3 percent last year — from $8.28 billion to over $8.47 billion.
Total taxable real estate in the city increased in value by roughly 0.48 percent during that same time period — from $5.68 billion to just over $5.71 billion.
That means that tax-exempt real estate makes up a full 59.7 percent of all real estate in this city.
When taking into account automobiles and personal property, which are the other two categories of local property value that that make up the total grand list along with real estate, roughly 56 percent of all city property value is currently tax exempt.
Thomas Breen file photo
East Rock Alder Decker: How do we close the gap?
“Why is the gap between the tax-exempt grand list and the taxable grand list increasing?” asked East Rock Alder Charles Decker.
Is it because tax-exempt nonprofits like Yale University and Yale New Haven Hospital are buying more properties? Or is it because the value of the properties that those types of institutions already own are increasing in value?
“The answer is the latter,” Pullen said. “The properties are becoming increasingly more valuable.”
He pointed out that the city is home to a large university and a large hospital, both of which “really like to build.”
“And when they build things, they build to the gold standard,” he said.
SHEPLEY BULFINCH RENDERING
Yale New Haven Hospital’s proposed new neuroscience center, which will likely add to the tax-exempt grand list.
The hospital’s planned $838 million construction of a new neuroscience center at its Saint Raphael campus is a perfect example of that very kind of project that will likely boost the city’s tax-exempt grand list yet again.
Pullen said that Yale University’s tax-exempt properties increased in value by over $163 million last year — from roughly $3.37 billion to over $3.53 billion. The university’s tax-exempt properties make up 42 percent of the city’s total tax-exempt grand list.
The hospital’s tax-exempt properties, meanwhile, increased in value by roughly $4 million last year — from $1.208 billion to $1.212 billion. The hospital’s tax-exempt properties make up 9 percent of the city’s total tax-exempt grand list.
Yale is also a primary tenant in many large tax-exempt properties that are technically owned by Winstanley.
“Is there any hope on the horizon for that gap shrinking?” Decker asked about the ever-growing distance between the city’s taxable and tax-exempt grand lists.
“There’s always a way that it can close,” Pullen said. He cautioned that he is not the best person to answer how and when that might happen.
“I don’t know what Yale plans to build. I don’t know when they plan to stop building.”
There are many brand new apartment buildings being built throughout the city, he said. While many of those are beneficiaries of the city’s tax assessment deferral program, they will ultimately boost the city’s taxable grand list once they phase fully onto the tax rolls.
“It looks like people are really building and investing in New Haven,” he said. “I think that there will be a time when the tax-exempt list goes down to 50 percent [of the total grand list], where it was 15 years ago.”