RUTLAND CITY — Marble City voters signed off on a $3.9 million bond for city infrastructure upgrades, laying the groundwork for a hotel project and other development downtown.
A sweeping 85% of Rutland voters approved the bond during the special vote held Tuesday, with 1,190 ballots cast in favor and 213 against, according to an unofficial tally released by the clerk’s office.
“It’s a really exciting message that the voters recognize how important these types of infrastructure upgrades are to the future development of our city,” said Rutland City Mayor Mike Doenges Wednesday morning.
The bond will go towards funding the repair of aging wastewater pipes, burying power lines and widening sidewalks in the city’s downtown area. The infrastructure upgrade is the first phase in a master plan crafted through the establishment of the city’s Tax Increment Financing, or TIF, district. The TIF district was approved by the city’s Board of Aldermen and the Vermont Economic Progress Council earlier this year, said Doenges.
For the next 10 years, the TIF district designation allows Rutland to undertake a large-scale revitalization effort. The city will be able to take out debt for infrastructure upgrades, brownfield remediation and other city projects that are tied to private development proposals, but in a way that is intended to keep taxpayers off the hook for the cost.
The infrastructure upgrades will enable private developers to construct a four-story hotel project in a section of downtown Rutland called “the pit,” which has remained a vacant lot since a fire destroyed the townhouse hotel at the corner of Center Street and Wales Street in 1973.
Rutland resident Bradford Morgan said he voted in favor of the TIF bond because he thinks the economic development tool is a sound strategy to make a much-needed fix to the wastewater infrastructure in the city. Morgan added that more than five decades is far too long for “the pit” at the heart of downtown to remain undeveloped.
“I think it’s a smart idea to make a commitment to pay off a bond, but you get the money first,” Morgan said. “The odds are really good that the investment made by it will pay for itself, and it’s time to fill in that hole in the ground since the townhouse fire.”
On the other hand, city resident Steven Rider said that he voted against the TIF bond because he is worried that the financing model will not pan out for future taxpayers. Rider said he thinks that the private developers should take on the costs of the projects necessary to make way for a hotel.
“I didn’t vote (for) it because it’s a tax in the future, and I don’t believe in them burdening the taxes on our future generation,” Rider said. “Right now, the downtown is already set as is.”
Unlike a typical city bond that falls on city property tax payers, the newly approved bond — financed through the Tax Increment Financing model — will be paid back through the additional tax revenue produced by the hotel property over the course of 20 years. A portion of the difference in tax revenue, or tax increment, will also go toward the municipal general fund and the state’s education fund.
A TIF bond for future projects also must be greenlit by the Vermont Economic Progress Council and the city voters and will be funded by the increased tax revenue of other developments within the district lines, said Doenges.
While the city will break ground on infrastructure projects next spring, the approval of the bond by Rutland voters means the private developers who have agreed to take on the hotel project have the go ahead to start cleaning up the site even earlier, said Doenges.
Another supportive Rutland resident, Beverly Boston, said she voted in favor of the TIF bond because, if it hadn’t been approved, the cost of replacing the deteriorating wastewater lines would fall on property taxpayers, who have “already been hit so hard.”
Eric Lapp, a resident since 1998, said that he voted in favor of the TIF bond because he said changes are already afoot in Rutland, with the Diamond Run Mall closing nearly six years ago and the proposed Walmart relocation away from the city center. An improved wastewater system will facilitate more development which will, in turn, cultivate more business growth and tourism to Rutland’s downtown in the future, Lapp said.
“If the hotel goes through and is successful, it’s going to be a big boost,” Lapp said. “Rutland needs to grow and change, and there’s a lot of debate on both sides of the coin here, but on balance, I think it’s something we should at least give a try.”
Rutland resident Becky Pell said she voted in favor of the bond because she believes the downtown revitalization effort will help the local economy thrive.
“I think it’s important that this bond go through. I think it’s going to increase our ability to keep Rutland alive,” Pell said. “It’s been hard for Rutlanders to keep businesses here, and we need that. Plus, we need the infrastructure.”
This story was republished with permission from VtDigger, which offers its reporting at no cost to local news organizations through its Community News Sharing Project. To learn more, visit vtdigger.org/community-news-sharing-project.