Lessons We Can All Learn From
Unfortunately, we can’t all be Greg O’Connells. But at least there are lessons that we can pick up in his wake to help us drive our own revitalization efforts.
Lesson #1: Engage the Community
O’Connell didn’t turn Mount Morris around on his own. Change on that scale takes a village and there were (and still are) many other hands playing key roles along the way:
High school wood shop students built planters around trees. Other students raised and planted flowers and made banners for the streetlights.
Metal shop students built the brackets for hanging baskets and a kiosk for event information. They also created life-size angel sculptures for display at each of 30 businesses during the month of December.
SUNY Geneseo college students developed promotional campaigns for the village and the individual businesses.
SUNY Geneseo students perform plays and musical events in a space on Main Street.
Lesson #2: Focus on Small Business Development
Mount Morris and O’Connell recruited local startups and entrepreneurs instead of big retailers or employers. This strategy was crucial to fostering a vibrant downtown and forming an attractive place to live. Only once they had succeeded there were they able to start recruiting bigger companies. Here are just some of the steps they took:
Design guidelines were developed to address storefront design, signage, lighting, and window displays that ensure a pedestrian-friendly and aesthetically-pleasing environment.
Business guidelines were developed to encourage businesses to change window displays seasonally and to keep display lights on at night. This ensures a more dynamic and active streetscape.
Livingston County provides a highly successful 10-week Business Ownership Training Course for aspiring entrepreneurs. Graduates from the class have opened many of the new businesses in Mount Morris.
Niche businesses have been targeted for the new storefronts. Antique stores, arts-based businesses, and specialty restaurants have been recruited.
O’Connell offers inexpensive rents to minimize risk for startup businesses.
Local banks and the Livingston County Development Corporation have developed special loan products to support new businesses.
Lesson #3: Leverage Municipal, State, and Federal Subsidies
Unfortunately, there were not many subsidy options available to O’Connell at the time. He had to make do with his own private funds.
However, since then, he has become a staunch advocate for government subsidy to promote similar revitalization efforts across other communities. Because, you know, not everyone has a $400-million-plus real estate empire to draw from.
Property Tax Abatements
New York State Legislature passed the Ithaca Law in 2001, which enables cities to pursue their own version of a tax abatement program for new construction and extensive rehabilitation projects.
Most common is a 10-year program. In a nutshell, property tax remains constant for five years after project completion. Then, beginning at year six, the new property tax is introduced in equal increments until full tax liability is reached in year 10.
The power of this cannot be understated. Margins are razor thin for downtown revitalization projects, especially if the developer is looking to make rents affordable for local residents and small businesses. Phasing in any new tax burden over time reduces operating expenses in the initial years and allows savings to be passed off to tenants.
Tax Credit Programs
These act as a direct offset against income taxes and are often used for downtown revitalization projects. So, if a project is awarded $100,000 in tax credits, the owners are able to reduce their tax payments by $100,000.
Alternatively, tax credits can often be sold to a local insurance company or bank for $0.95 on the dollar.
Vermont, for example, has a very robust program. In the fiscal year 2021, the state awarded north of $3 million in tax credits across 29 projects.
The only downside is that credits are only awarded once per year. So, projects need to be planned around that deadline, not vice versa.