Hartford Business Journal

24 Hartford Business Journal • February 19, 2018 • www.HartfordBusiness.com OTHER VOICES A blueprint to turnaround Hartford By Oz Griebel O ver the last 20 years, we have invested billions of our federal and state tax dollars in Hartford and Connecticut's other urban centers. The investment in Hartford has resulted in the establishment of the Connecticut Science Center, the renovation of the G. Fox building, major improvements to The Bushnell, Hartford Stage and the Wadsworth Atheneum, the launch of the University of St. Joseph School of Pharmacy, the relocation of the UConn campus from West Hartford, and several thousand new apartment units. At the same time, Hartford's mill rate has increased to nearly 75, preventing any major unsubsidized private investment. The real property component of the Grand List plummeted by more than 37 percent over the last 20 years from $4.8 billion to $3 billion. The only way to reverse this trend is to launch a meaningful and radical restructuring of Hartford's assessment and taxing policies to restore the confidence of homeowners and commercial investors. That confidence is critical to driving the growth in the Grand List needed to produce a competitive mill rate of 50 or lower over the next five years. Much has been made of the city's current fiscal crisis, including talk of a bankruptcy filing. While three major property owners have pledged financial support, the state government has reacted with another bailout plan that will neither accomplish reform nor reduce the mill rate. While the creation of the Municipal Accountability Review Board (MARB) will be helpful, tackling the city's fiscal crisis requires a "grand plan" comparable to the one implemented by Detroit as part of its bankruptcy. Hartford's major government and private-sector stakeholders must create such a strategic plan prior to the adoption of the city's budget for fiscal 2019. The plan must be approved by the MARB before the state provides any additional financial support to the city. Such a collaborative approach is the only way the city will achieve the comprehensive and sustainable fiscal reform required by Aetna, The Hartford and Travelers to deliver on their extraordinary commitment of $50 million of financial assistance over five years. As importantly, it is the only way to reignite the confidence needed by the private sector to invest on an unsubsidized basis. During my last year at the MetroHartford Alliance, we provided city leadership and major property owners with the draft of such a plan. The key elements include: • Capping the growth in the city's annual budget for the next five years; • Privatizing certain city services; • Consolidating the Department of Public Works and information technology functions of the city and its schools; • Increasing the assessment ratio for residential housing to 70 percent; • Converting all state-owned office buildings to private ownership; • Securing an agreement from the larger commercial property owners that they will pay the same amount of property taxes as they did in fiscal 2017 for five years regardless of any decrease in the mill rate; • Working with the larger tax- exempt properties to determine a fair rate of taxation. We also recommended two additional steps for a compelling regional strategy. The first is for The Hartford Foundation for Public Giving to take the lead to fund and structure a robust marketing plan that promotes the region's assets and focuses on jobs growth and attracting private-sector investment. The second action is for the Capital Region Council of Governments to develop a comprehensive plan to deliver key municipal services across its 39 towns on a more cost-effective basis. The city's fiscal crisis provides us with an extraordinary opportunity to collaborate on a radical and effective approach to ensure fiscal stability and economic and job growth. Oz Griebel is the former CEO of the MetroHartford Alliance and is running for governor as an independent. Oz Griebel OTHER VOICES Warning of rolling blackouts puts natural gas in perspective By Carl Gustin G ov. Dannel P. Malloy and other New England governors showed foresight in 2013 when they called for upgrading and modernizing natural gas infrastructure throughout the region, in part to complement the growing use of intermittent solar and wind energy. Unfortunately, inconsistent policies and litigation have so far blocked needed expansion. Now, the region is seeing the consequences of inaction, with Bloomberg reporting Dec. 27 — even as the full impact of an extreme and prolonged cold spell had not yet hit — that "spot prices more than tripled … and turned the region into the world's priciest gas market." In Nov. 2013, the Connecticut regulatory authority approved a natural gas expansion plan. Malloy noted that it was "another step to help our residents and businesses lower their energy bills." A month later, six New England governors called for "significant investments in our region's energy resources and infrastructure." Among the reasons, the governors cited natural gas infrastructure "to balance intermittent generation," which is solar and wind energy. They committed "to achieving consensus … consistent with laws and policies across the region." Consensus is still lacking despite Malloy's efforts and those of other governors. After initial efforts, subsequent setbacks revealed the need for better clarity and more consistency among the states to encourage infrastructure investments. Adding to growing concern throughout the region, the organization responsible for keeping the power flowing in New England — ISO New England — issued a report Jan. 17 finding that in 23 scenarios analyzed for the winter of 2024/2025 "all but the most optimistic case resulted in rolling blackouts." While energy prices have risen dramatically, there are other consequences. On Jan. 5, oil — used primarily as a back-up fuel — generated one-third of the region's electricity. Cleaner-burning natural gas, normally accounting for about half the region's generation, provided just 16 percent because of inadequate fuel supply. Solar and wind were providing just 2 percent. There has been good progress since 2013 deploying solar and wind resources. Expanding renewable energy resources is a good thing. But wind and solar are intermittent resources that require natural gas generation to fill the gap. To ignore the severe consequences of inadequate gas supplies impacting the economic health of the region runs counter to the foresight shown by governors in 2013. Someday the electric grid may be powered by renewable energy backed up by battery storage. For now, the needs of consumers expecting electricity around the clock must still be met by natural gas-fired power plants working in concert with intermittent power from wind and solar. New England utilities are national leaders promoting energy efficiency and adopting renewable resources. Eversource promotes solar energy on a large scale. It invests in major wind development with a goal of producing 2,000 megawatts of offshore wind energy in the next decade. When New England's governors made natural gas pipeline expansion a priority in 2013, natural gas companies and utilities were asked to step forward and they responded with investment proposals subject to regulatory approval and oversight. Those proposals were blocked or stalled by conflicting public policies and aggressive litigation. That must end. It is time for the region to adopt consistent policies and a regulatory framework that recognize the need for renewables and natural gas generation — while including a workable role for utilities to invest in natural gas infrastructure. Carl Gustin is a former energy executive with Northeast Utilities and NSTAR. Opinion & Commentary Carl Gustin

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