Critics say Bridgewater deal side-steps state and local policies
Governor Dannel Malloy says the state's $115 million investment in the hedge fund Bridgewater was made to save jobs in the state. But the incentive plan to move the company from Westport to Stamford has drawn criticism from groups that say the Connecticut is sidestepping state and local policies.
For Governor Malloy, the Bridgewater deal is a no-brainer. The country's largest hedge fund was threatening to leave the state. That could cost Connecticut a lot of jobs. Instead, he was able to get Bridgewater to stay, build a new $750-million headquarters. And to add as many as 1000 new jobs. For a price tag of $115 million.
“They were being courted by New Jersey and New York for the purposes of relocation out of Connecticut," Malloy told WNPR's "Where We Live." That would have cost us tens of millions of dollars per year.”
But for many others, the deal represents a total shift in state policy. For example, the site for Bridgewater’s headquarters happens to be smack in the middle of a high-risk floodplain. According to state environmental policy, state funds can't be used to build in places like that. You can sidestep the policy by applying for a kind of waiver from the state, but that’s rare.
“I’m not aware of such a request being made previously for a project in Connecticut," says Tim Sheehan, director of Norwalk’s Redevelopment Agency. A public housing project in Norwalk called Washington Village routinely floods even during smaller rainstorms because it was built right on the water more than 70 years ago. Sheehan and Norwalk officials have tried to get a state waiver to rebuild it, but they haven’t had success. So how come Bridgewater gets one?
Governor Malloy says Bridgewater is spending hundreds of millions to make sure its new headquarters will be protected from future storms – by raising the land as much as 12 feet.
“Building above the floodplain is very different than saying ‘we want to go in and build at exactly the same level that we built before," he says.
But the plan to rebuild Norwalk’s housing on the water also includes raising it out of the floodplain.
Betsy Crum of the Connecticut Housing Coalition says if Bridgewater’s getting softer treatment when it comes to Connecticut’s environmental policies, “There should be softening of the policy for redeveloping existing housing."
The Governor's got another fight on his hands over the Bridgewater site. The 14-acre peninsula the hedge fund will move to used to be a boatyard. It was Stamford’s last-remaining boatyard, and just a few years ago, the DEEP argued in a strongly-worded letter that the land should be reserved for a “water-dependent use.” Commissioner Dan Esty now says these are different times. Economic development is now part of the DEEP’s mission.
“There is a commitment in the current Deparmtent of Energy and Environmental Protection, DEEP, to take a third E on board, that being the economy," he says.
Cynthia Reeder is a Stamford resident and part of the group Save Our Boatyard. She isn’t buying Esty’s explanation.
"The DEEP is being compromised by impossible to validate economic promises, and by the political and financial ambitions of a few people willing to gamble away public funds," Reeder says.
Stamford residents and officials, including Mayor Michael Pavia, are upset that they didn’t know anything about the Bridgewater deal before it was announced last August. Normally, a $115 million deal would need legislative approval. But since it’s part of Malloy’s “Next Five” economic development plan, it doesn’t. Malloy is now proposing a law expanding that program – so that more big deals could be done without legislative approval. Economic development commissioner Catherine Smith said that’s necessary to keep the state competitive.
“If we want to be in the market for some of these larger transactions, then I do think we need to raise the bar a bit," Smith says.
That sets up the likelihood of more tensions between towns and the state over the best way to grow jobs in Connecticut.
Read more in the Connecticut Mirror at ctmirror.org.