The two new Archive buildings, at 808 and 848 Chapel. The developer behind a new Chapel Street apartment complex wants to transfer an existing tax break as part of a planned property sale — prompting a debate about whether the city should get something in return. The City Plan Commission to ok that proposal up for consideration Wednesday night at its latest monthly online-only meeting. The debate raised questions about if and how the city should use tax breaks to encourage new housing development — and whether or not the public good has been fully served on such matters once a building has been built. The debate also harkened back to the alders’ decision in 2019 to amend the city’s standard real estate tax assessment deferral program to prohibit such agreements from being transferred to new owners. That change came after the sale of several high-profile projects that had benefited from the city’s tax-break program, including the Novella. The alders voted to change the program in 2019 to discourage developers from selling newly constructed complexes at a “premium” with no benefit to the city. The underlying proposal in this case has been submitted by CASL New Haven LLC, a holding company controlled by the Chicago-based developer CA Ventures. That’s the company that built and owns the 166-unit, market-rate “Archive” apartment buildings at 808 and 848 Chapel St. downtown. CA Ventures purchased those long-vacant properties for $6.75 million in 2022 from Paul Denz’s company Northside Development. In 2024, CA Ventures completed construction and started renting out the 166 new apartments spread across two buildings. The developer now wants to sell. And they want a 2023-issued city tax break to transfer with the sale. On Wednesday, the City Plan Commission wound up voting to “advise the Board of Alders to explore the feasibility of introducing an affordability commitment for the new ownership as a condition for the transfer of the tax deal,” as Westville Alder and City Plan Commission member Adam Marchand put it. Developer: “Continued Developer Interest” At Risk Tax details and projections, as included in the developer’s request to transfer the tax break. The developer’s request is detailed in a June 4 letter sent to the Board of Alders. In that letter, Farmington-based attorney Michael Reiner asked the alders to consider amending an existing tax assessment deferral agreement between the City of New Haven and CASL New Haven LLC in regards to the properties at 842 and 848 Chapel St. (The Archive building at 848 Chapel is home to 120 apartments; the Archive building at 808 Chapel is home to 46 apartments; 842 Chapel does not appear to be a legally distinct address, and appears to be part of 848 Chapel.) The tax-break agreement, signed in 2023, provides the Archive’s owner with a standard city tax assessment deferral benefit that is also available to other developers. The agreement freezes the relevant property’s tax assessment during construction, then phases in the full new post-development increase to the tax assessment over the course of the subsequent five years. The latest city tax bill for 848 Chapel St. shows a city assessment of $17,227,350 and an exemption of $12,240,638, translating to a net assessment of $4,986,712. That means that, this fiscal year, the Archive’s owner is benefiting from a roughly 70 percent break on the property’s tax assessment — and therefore on its tax bill, which is currently $210,199.88. The latest city tax bill for 808 Chapel St., meanwhile, shows a city assessment of $6,784,750, an exemption of $4,700,325, translating to a net assessment of $2,084,425. That property’s current tax bill is $87,862.70. In particular, Reiner asked the alders to eliminate Section 7 of the 2023 agreement. That section states that, if the current owner sell more than 50 percent of the “legal or equitable interest” in the properties to a different owner, “then this Agreement shall automatically terminate and be null and void and of no remaining force or effect.” The alders and the city added that provision to standard tax assessment deferral agreements back in 2019; it became effective in 2020. The rationale behind the inclusion of that section was to deter developers from selling newly completed projects at a “premium, for no benefit to the city,” as city economic development staffer Clay Williams told the Independent on Friday. As then-city Deputy Economic Development Administrator Steve Fontana told the alders at a 2019 committee hearing on the matter, “Let’s make sure that if somebody comes to the city and asks for the benefit, in order to receive the benefit, they have to own it for the entire period.” In his June 4 letter to the alders, Reiner argued that, “While CASL may receive some modest pecuniary reward if it were to sell the Properties, the economic advantage to the City of New Haven over the next twenty years is very significant. That letter includes a 20-year tax projection — suggesting that these two newly developed residential properties would yield a total of $17.4 million in local taxes between 2026 and 2045 (if the mill rate and the underlying assessment were to stay the same, which the attorney noted is “statistically impossible.”). “CASL feels that the inability to freely transfer the Agreements shall have the effect of deterring continued developer interest in areas of New Haven,” Reiner continued. “We submit that the modest gains you are trying to prohibit developers from attaining by transferring these benefits (the benefits are technically already conveyed) create a significant economic loss to the City of New Haven.” In a Friday interview with the Independent, Williams — while recalling why the city introduced this tax-break-transfer prohibition in the first place — spoke out against amending the agreement for the Archive’s owners. The city’s goal is to promote affordable housing, he said. Given the upcoming citywide revaluation, “whoever buys this has an incentive to increase rents.” He also warned that, if the alders remove this no-transfer provision for the Archive, then other developers who have built new apartments in recent years — and who are still benefiting from a phased-in tax assessment — might come knocking and asking for their agreements to be updated, too. “My opinion is, for these larger projects, we should keep that provision in force,” Williams said. CASL’s tax-break-transfer request is slated to be heard by the Board of Alders Tax Abatement Committee on Tuesday, July 28, before heading to the full Board of Alders for review and a potential final vote. “Why Make It Easier To Sell?” On Wednesday, the City Plan Commission took up this proposal for discussion as part of a section of its agenda involving Board of Alders referrals. The commission has the authority to issue recommendations on such matters; the final decision-making power belongs to the alders. Marchand initially spoke up in support of allowing the developer to transfer the tax break as part of a property sale. “The project is built,” Marchand said. Now “they want to sell,” and they want the buyer to be able to “inherit all the financial benefits connected” with the project. “From a fairness perspective,” Marchand continued, since the city approved the tax-assessment-deferral agreement to help make sure the apartments got built, “I wouldn’t want to hamper their ability to sell. It would just complicate their transaction. … The rationale for approving it in the first instance is still there.” Carl Goldfield, a fellow City Plan Commission member and a former alder — and former president of the Board of Alders — pushed back. “Why do we want to make it easier for these people to sell?” Goldfield asked. “It seems like an opportunity for us to maybe get something back, some benefit to the city. These are private parties. I don’t understand why we would want to make life easier for them.” Goldfield continued, “The project’s been built. We held up our end. They got the tax abatement. I don’t see the rationale for doing this.” He said it’s nice that Marchand wants to be “generous” here, but “I just question whether there’s something that we might get in exchange for this.” He added that he is “not a big fan of these tax abatements to begin with.” Marchand replied that the city has a standard assessment deferral program for developers. He also noted that this development was built before the city adopted an inclusionary zoning ordinance, which requires new residential developments to set aside a percentage of apartments at below-market rents. “I think folks can have different views” on whether or not a tax-assessment-deferral agreement should be transferrable as part of a property sale, Marchand added. Perhaps that’s the “leverage” the city could use,” Goldfield said. What if the city says, “Offer us an affordable unit, then we’d be happy to allow you to transfer these tax benefits.” Ultimately, Marchand made a motion — unanimously backed by his commission colleagues — to advise the alders to “explore the feasibility” of requiring the inclusion of some affordability component as part of a transfer of the tax deal. What would Honest Abe do? A look inside a ground-floor office at the Archive on Chapel. 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