Hartford Business Journal

HBJ112723

Issue link: https://nebusinessmedia.uberflip.com/i/1511976

Contents of this Issue

Navigation

Page 29 of 31

30 HARTFORDBUSINESS.COM | NOVEMBER 27, 2023 Opinion & Commentary EDITOR'S TAKE Top early priorities for Hartford's new mayor T he city of Hartford will have new leadership in 2024, as Mayor-elect Arunan Arulam- palam prepares to take office. Arulampalam, a Democrat, won the Nov. 7 election by a wide margin, but now faces the much more difficult task of running a city facing significant long-term challenges. It's a huge test for a 38-year-old political newcomer who has not previously held public office. Arulampalam has already made some early moves by naming key leaders to his transition team, including Democratic Speaker of the House Matt Ritter, Hart- ford Foundation President Jay Williams and Andrea Comer, chief of staff to the state treasurer. He has also appointed 22 transition policy committee co-chairs. While many newly elected officials come into office with grand dreams and plans, successful administrations are usually built one small victory at a time. Here are a few key priorities Arulampalam should focus on now and during his first 100 days in office. Staffing up Key to Arulampalam's success will be hiring qualified and competent staff throughout his administration, particularly in economic development roles. The private sector should have a strong voice within the Arulampalam administration. New governors and mayors often face pressure to hire staffers who helped get them elected. That can't be the focus, especially within a city hall that is more thinly staffed than it used to be. During an interview with the Hart- ford Business Journal in August, Arulampalam pitched the idea of creating a business advocate position that reports directly to the mayor. The advocate would be the point of entry to city hall for developers, companies seeking to expand, or startups looking to get off the ground, he said. The idea is a good one, and creating and hiring someone for that post should be a priority within the next few weeks and months. Regulatory reforms Another priority is improving the regulatory environment, particularly speeding up the permitting process. Developers and other businesses have complained about the long wait times to receive building and other permits. That's unacceptable in a city starving for private investment and new businesses. The Arulampalam administration should flip that notion on its head and make Hartford one of the easiest Connecticut municipalities to do business in. On the campaign trail, Arulam- palam said he'd like to hire more building inspectors and streamline the permitting process. He said he led a license streamlining effort when he was deputy commissioner of the state Department of Consumer Protec- tion, which has the second-largest licensing and permitting portfolio within state government, behind the public health department. Let's hope he makes use of that experience early on and throughout his four-year term. Economic development The city's future success will be driven, in part, by economic growth. To make that happen, the city must maintain a strong partner- ship with the private sector, make Hartford an attractive investment option and continue to invest in workforce development. Investment in downtown housing must continue, including conver- sion of more underutilized offices into apartments. Much of that activity is driven by the Capital Region Development Authority, which provides low-interest gap financing to help get major devel- opments off the ground. Developer tax-break deals, while not politically popular, must remain in play, at least until the city's tax rate can be lowered to a more reasonable level. It would be good if the Arulampalam administration can articulate a clearer policy around what types of private investments qualify for a tax break. That would bring more transparency to the process and potentially help businesses and developers focus their time and efforts. Maybe greater incentives or tax breaks can be offered for investment in the city's often-overlooked neighborhoods. Of course, there is a fine line municipalities must walk in the incentives game. While the city's financial position is in much better shape than it was eight years ago, Hartford can't afford to give away the store to lure flashy new projects. Budget stability must be a priority as Arulampalam crafts his first spending plan in the months ahead. The city also needs to attract new employers, targeting small to midsize companies that see value in a vibrant urban environment. There are many other pressing issues the Arulampalam administra- tion will confront, from gun violence to an understaffed police department. The mayor's job can be overwhelming. A successful mayor must have a grand future vision that's achieved through small, incremental victories. Greg Bordonaro EXPERT'S CORNER Corporate Transparency Act creates new reporting requirements for small businesses By Stephanie Cummings and Matthew H. Gaul B eginning Jan. 1, 2024, U.S. businesses, for the first time, will be required to report their beneficial ownership directly to the federal government. This fundamental shift in reporting requirements is targeted to affect small businesses, irrespective of busi- ness type or history, under the theory that small businesses are the companies most likely to be engaged in money laundering. Failure to comply with reporting require- ments carries significant criminal and financial penalties. These new requirements are a result of the Corporate Transparency Act (CTA), enacted in January 2021, which provides the federal govern- ment — via the Financial Crimes Enforcement Network (FinCEN), a bureau of the Department of Treasury — ownership and control information of small companies. The breadth of this law will impact many types of entities, such as real estate and family holding companies, main street businesses, small manu- facturers, and many others. Given the enormity of the under- taking of the CTA's requirements, the implementation of the act has been delayed for several years, but is now set to go into effect on Jan. 1, 2024. The CTA requires that businesses — such as LLCs, corporations and certain other entities — known under the CTA as "reporting companies," identify each individual who has a 25% or more beneficial interest in, or "substantial control" of, the organization. The required identifying information includes name, address, date of birth, and a copy of government identifica- tion, such as a driver's license. Failure to make the report in a timely manner carries penalties of $500 per day (up to $10,000 per violation) and up to two years in prison for "control persons" of the business, which includes most officers, directors, managers and general partners. There are currently 23 reporting company exemptions, designed to exclude certain businesses with existing oversight structures. These include: federal or state credit unions; most companies required to file U.S. Securities and Exchange Commission reports, including public companies, invest- ment advisers and investment funds; accounting firms; most tax-exempt entities; and wholly owned subsid- iaries of exempted companies. One of the most important exemp- tions is known as the "large operating company" exemption, which applies to businesses that have all three of the following: more than 20 full-time employees; more than $5 million in gross receipts or sales; and an oper- ating presence with a physical office within the U.S. Even if exempted, businesses should carefully review their entity structures to determine whether any affiliates are subject to reporting requirements. Stephanie Cummings Matthew H. Gaul

Articles in this issue

Links on this page

Archives of this issue

view archives of Hartford Business Journal - HBJ112723