Norwich reluctantly backs Reid & Hughes with $150,000

Norwich — City councilors on Monday reluctantly approved spending up to $150,000 of city money to help preserve the Reid & Hughes building, but only if engineers determine the building can be saved before the city’s money is spent.

The city’s contribution is expected to be the final grant portion of the estimated $500,000 needed to stabilize the decaying Main Street building and give the preferred developer, the Women’s Institute for Housing and Economic Development, the time it needs to seek $6 million in financing for a planned renovation.

The council voted 6-1 to authorize City Manager John Salomone to amend the city’s development agreement with the Women’s Institute to set conditions for use of the city’s money. The vote was a reversal of the council’s past expressed sentiment against contributing any city funds directly to the effort to save the cityowned building.

Women’s Institute Executive Director Betsy Crum told the council March 6 that the institute has secured $315,000 from grant sources toward the estimated $500,000 needed to stabilize the building. An application for the final $150,000 from the downtown revitalization program was rejected March 6, prompting the request to the City Council.

Salomone is expected to bring the amended contract to the council on April 2 for final approval.

Meanwhile, officials at the Women’s Institute will prepare to mobilize for the stabilization phase, Christine Rogers, senior development manager for the Women’s Institute, said Monday. No construction contracts would be signed before April 2, Rogers said, but advanced preparations could be done, including updating estimates from February, so that construction on the stabilization could start about four weeks from now.

Rogers told the City Council the institute has received three commitment letters for $250,000 in grant funds and the institute’s board of directors is willing to move forward immediately with approval of the local funds from Norwich. The institute also has been approved for a $450,000 loan for the stabilization portion, but the board does not want to commit to using the full loan for the temporary stabilization.

Rogers said the board won’t close on any loan before having the city’s funding, but the institute does not plan to use the full amount of the loan.

“We are very optimistic we can move forward with this stabilization,” she said in answer to aldermen’s questions and concerns about whether the project could be done at all.

Rogers said the institute’s latest estimate puts the “hard cost” of stabilization at $500,000, plus another $200,000 for “soft costs,” such as insurance and snow removal.

Aldermen wavered in their support for the $150,000. Alderman Joseph DeLucia said he was very nervous that the project could go forward while Alderman Samuel Browning projected that there would be no political support for any funding beyond the $150,000.

Rogers responded the institute does not anticipate needing another allocation from the council, and assured the council that the institute is not planning to seek any property tax abatement, and the project would be fully taxable.

She attempted to calm council members’ fears by saying the institute has the experience with similar projects and is willing to take the risk. She said the institute should know “very quickly” whether the stabilization will be feasible, before spending the city’s money.

The City Council last fall approved bonding up to $800,000 to demolish the building, but the State Historic Preservation Council voted unanimously to reject that plan, saying there were alternatives. The Women’s Institute was the lone bidder in the city’s request for development proposals that followed.

Mayor Peter Nystrom argued that the city has been the irresponsible owner of the property for the past two decades, and it would be fiscally irresponsible to abandon the developer in exchange for a price tag of more than $1 million to tear it down — including a legal battle with the state.

Historic preservation advocates urged the council to approve Monday’s resolution.

Dale Plummer, city historian and president of the Norwich Heritage Trust, which has led the effort to save the Reid & Hughes, on Monday cited the City Council’s Feb. 20 unanimous vote to seek designation as a federal “Preserve America Community” in urging the council to support the Reid & Hughes project.

The Feb. 20 resolution stated that if Norwich receives the designation, the city would “work to protect and celebrate our heritage, use our historic assets for economic development and community revitalization.”

Susan Masse, vice president of Norwich Heritage Trust, said the City Council’s contribution to the project is appropriate because the city owns the building and will boost downtown development.

“I sincerely believe that the city’s positive attitude toward development in downtown will attract more and more businesses,” Masse said.