DECD Deputy Commissioner David Kooris Discusses Tourism, Opportunity Zones and State Pier at Business Breakfast
Making the most of opportunities was the theme described by David Kooris, deputy commissioner of the State Department of Economic and Community Development, at the Chamber of Commerce of Eastern CT’s Business Breakfast on October 2, sponsored by Gateway New London and Connecticut Carpenters Union 236.
With his responsibilities at the DECD covering transit-oriented development, brownfields, capital projects, waterfront, and tourism, Kooris touched on tourism dollars, Opportunity Zones, and transit challenges. Kooris is also currently serving as the acting chair of the Connecticut Port Authority and addressed ongoing negotiations around the development of State Pier through a joint venture of Orsted and Eversource to create a wind turbine hub in New London.
Sustaining funding levels under a tough budget was a significant victory in the past year. Available dollars have been directed toward digital platforms that provide valuable feedback on their effectiveness. Using Arrivalist, the Office of Tourism can track people who engage with digital content and see when they arrive at the destinations they researched. “It allows us to target our dollars in a really particular and focused way that enables us to ensure that we are creating that return on that investment,” said Kooris.
Kooris emphasized the value of tourism, arts and culture as economic drivers. With the return on investment in tourism clearly demonstrable and actually contributing to State resources, the data supports advocating for additional dollars. “We understand how important it is, not just to the state as a whole, but to southeastern Connecticut in particular,” said Kooris.
On Opportunity Zones
Citing the growing desire for housing with walking access to work, amenities and entertainment, Kooris said southeast Connecticut is “phenomenally” positioned to capitalize on that trend with its historic small cities and villages.
Kooris stated the state is eager to support municipalities’ efforts toward revitalization of urban centers, and the state is identifying and getting behind the most promising private investment opportunities. The 2017 Tax Act established an investment tool called Opportunity Zones. A tax benefit associated with capital gains offers incentives to invest in designated areas of communities including New London, Norwich and Groton. The State has layered additional incentives because work in these designated areas align with the administration’s “overarching objectives of downtown revitalization, transit-oriented development, waterfront recapture, equitable mixed use and mixed income infill projects.” Using funds available through brownfield programs, infrastructure program, historic tax credits, they hope to mobilize some portion of the estimated $1.5 trillion of unrealized capital gains under this tax program.
The greatest return for investors is realized when they stay engaged for 10 years. “The most important thing we can convey to the private marketplace… is that our communities will be of greater value in the 2030s than in the 2020s,” said Kooris. It begins with conveying a clear long-term vision for Connecticut and its municipalities, mobilizing investments in infrastructure in support of that vision, and putting the right regulatory tools in place to ensure that private investment aligns with that vision. “If you are investing alongside us, we will make the path easier for you,” he said. A statewide conference on Connecticut Opportunity Zones will be held October 30 in New Haven.
On State Pier
Kooris began his overview of the proposal to use State Pier as a hub for offshore wind projects with a brief history of the pier outlined here. New London’s State Pier has been evaluated in many plans over decades to maximize its use and economic impact. Each plan lays out major infrastructure improvements needed to capitalize on opportunities and recommends that the state wait for a private partner with a high likelihood of maximizing utilization of the port and to share cost of improvements.
The rise of the wind energy industry, state commitments to source wind energy, and federal leases of areas miles offshore created an opportunity to capitalize on the asset of State Pier. In 2018, a bid by Deepwater Wind to provide power to Connecticut and Rhode Island included a commitment to invest $22.5 million in State Pier in the hopes the facility would accommodate some of the offshore wind work.
Also in 2018, CPA was in the process of seeking a new port operator when wind energy became a significant opportunity. In its public solicitation, CPA requested proposals from operators or wind developers or partnerships between the two. The selection of Gateway Terminals to run the Pier was founded on two points: confidence in their ability to operate the port and the potential of working with the Orsted and Eversource joint venture on offshore wind as a focused use of the port.
“We have heard consistently from our partners like Gateway, and our third-party advisors that the Port Authority has utilized throughout this process that for a port like New London seizing a niche opportunity is likely the best way to make the most of the facility,” said Kooris, ensuring a higher level of consistent activity over a longer period of time compared to variable opportunity. He gave the example of Rhode Island capturing automobile importation as a niche.
Negotiations with Gateway, Orsted and Eversource continue to evaluate whether offshore wind industry could be seized to the benefit of New London and the state as a whole. “We’re confident that the answer is yes,” said Kooris. He explained that through the public-private partnership they would achieve the full build potential outlined in previous plans, including additional upland area, heavy-lift capacity, and additional wharfage, with the private partner paying at least 55% or more of costs. The usage of the port would be maximized through contracts for windfarms along the Eastern Seaboard. During downtimes in wind installations, Gateway will be able to market the pier to other entities.
“When the wind scenario sunsets…we would have the benefit of the expanded and enhanced facility, owned by the state in perpetuity for us to market and maximize use,” he said. The administration strongly supports the opportunity as it achieves improvements to State Pier without incurring debt, brings the anchor of a new industry to the region with hundreds of good jobs, and establishes New London as a hub for offshore wind and positions the state for manufacturing wind turbines in the future.
“If the North American Industry reaches a scale that justifies private sector investment to replicate [European] manufacturing capacity to better serve the market here, we will be phenomenally positioned to capture a commanding share of that industry,” said Kooris. Manufacturing would look to collocate as close as possible to the installation hub in New London, establish facilities accessible by barge down the Thames River from Norwich or use parcels accessible by rail in eastern Connecticut.
Kooris addressed the issues inside the CPA, which led to his taking the role as acting chair. Increased oversight, multiple audits and new mechanisms have been put in place to better manage operations and institute new policies and procedures. He expressed hopes that people will recognize the work to address the fundamental issues at the Port Authority with transparency while simultaneously working to resolve the negotiations for State Pier.
“There are real deadlines that are looming,” said Kooris, referring to a 45-day window to determine if this is a viable agreement. The companies need to know that they will have a facility to meet their commitments to deliver wind energy, and if no agreement is made in New London, they will have to go elsewhere. Kooris explained that under Connecticut’s bid some wind activity will happen in New London regardless, but the difference is two years of limited work on the Connecticut project compared to ten years of more expansive work on multiple projects.
The balance now is rebuilding confidence in the Port Authority to effectively deliver on their public commitment while advancing this opportunity. “It’s just too important to this region and the state to let pass by,” said Kooris.
Thanking Kooris for the distillation of the complex issues around the State Pier proposal, Chamber President Tony Sheridan said, “What we have here in New London is the opportunity to be front and center of this new industry. Let’s find way to work together, compromise and make this work for everybody…Along with Groton, the submarine capital of the world, let’s make New London the offshore wind energy capital of the world.”