Against all odds, Elm City shows urban renewal

In downtown New Haven, two words are all too common: For Lease. The signs of urban blight-buildings in disrepair and boarded-up store fronts-are scattered throughout the area. Although commercial flight to the suburbs characterizes cities across the U .S., the trend has hit New Haven with a vengeance.

But things may not be as bad as they seem. The commercial real estate market has improved, and morale is rising among merchants, city planners, and realtors. Many currently abandoned buildings are slotted for occupancy, and the city is considering sev eral renewal initiatives. The task of downtown rejuvenation will not be easy as planners tackle deep-rooted and persistent problems. Roots of the blight

The disproportionate number of commercial vacancies in downtown New Haven is rooted in several current and historical conditions, including recent fluctuations in the state and local economies. According to Peter Hans of the City Planning Department, one of the city's challenges is its development patterns, dating back to the 1800s. "The city of New Haven developed when the principle form of transportation was the horse and trolley. Consequently the distance between home and work was critical. Houses were clustered and sideyards weren't important," he said.

Today, those development patterns are obsolete, according to Matthew Nemerson of the New Haven Chamber of Commerce. Modern-day residents crave the open spaces that were purposefully eliminated a century ago. "Most people want as much land as they can get.... People who love urban environments are now a subculture," Nemerson said. In an effort to escape the population density and urban problems associated with cities, increasing numbers of people that have relocated to the suburbs. Many businesses have followed.

This outward movement has left many spaces empty and strained the real estate market. The 1993 Macy's departure from Chapel Square Mall was among the most notable and is blamed by many officials for much blight. "It was really harmful in terms of hurt ing spin-off businesses. Having a department store in the downtown area created an anchor attracting smaller businesses," said Catherine Sullivan-DeCarlo, press secretary to Mayor John DeStefano Jr. Yale, other non-profits inflate taxes

These problems are exacerbated by New Haven's high property taxes, which are significantly greater than those of surrounding areas. According to Nemerson, the effective tax rate on commercial and residential properties is 2.5 percent in New Haven, but 1.6-2 percent in the suburbs. Businesses are additionally taxed for such items as computers and vehicles. In many cases the effective tax rates in New Haven for such items can be "as much as twice as high" as rates of the suburbs. Businesses with high-te ch equipment, therefore, "can be absolutely socked by New Haven rates," Nemerson said.

The proliferation of non-profit organizations in the city (including its seven universities) has pushed tax rates up by reducing the percentage of taxable land. "Tax-exempt organizations are concentrated in New Haven and the city must support those se rvices, even though they don't just serve city interests. For example, drug rehabilitation centers and the hospital also serve the suburbs. New Haven carries the burden of those services," Hans said.

(See Urban Renewal...)