Southington Hotels to Receive Incentive for Upgrades

Concerns remain over whether a tax abatement program would provide a benefit to the town and not simply to the businesses, but with very little risk and potentially a lot to gain, the Town Council is willing to test it out.

The council voted unanimously Monday night to approve a motion implementing the tax abatement program that sunsets after a three-year period unless renewed by the council. , existing hotels will receive abatement on any new property or real estate taxes provided they make at least $100,000 in improvements.

Hotels are still responsible for existing tax obligations.

“I think that ultimately there is a three-year sunset and I don’t want to see our hotels in disarray like they are on a turnpike in another town in this state,” said Council Chairman Edward Pocock III.

The approval came only after several discussions, including one on Monday as to whether to require a certain amount of “improvements that are permanently affixed,” an idea supported by Council members John Barry and Chris Palmieri.

The concerns were that the money would be spent on mattresses, televisions and other items that would lose value over the course of a five-year period, negating any gains the town would have made over that time period.

Palmieri and Barry both expressed concerns that a few newer hotels in town have already received abatement and did not want to see them take advantage of this as well while the hotels in need were unable to make repairs.

Louis Perillo III, Southington’s , said Monday that the tax savings for a hotel spending $100,000 would be just over $6,000 in a five-year period, however. Some hotels are already paying upwards of $75,000 in taxes.

Perillo said this is a win-win for the town of Southington and even if existing hotels – particularly those along Queen Street – were unable to take advantage of the program, it could convince other investors to buy out the hotel.

“Our office has been contacted by hotel consultants. They are watching these abatements,” Perillo said. “They are looking at corporate takeover. Do you want to send the message that want improvements? Two takeovers have already occurred in town, two more are being considered.”

Perillo said existing hotels that have already made renovations, such as the Residence Inn on West Street – a hotel that Barry said has “been a great corporate community partner” – would not be likely to use the incentive in the next three years.

The program will also encourage out of town visitors, Perillo said, which was part of the to present the program to the council.

Once the sunset period is over, the council will be able to reevaluate the program and make adjustments or discontinue it if it’s not beneficial, Perillo said. This option made it easier for council members to come to a unanimous decision.

“Another facet we must look at is the financial impact on the town. People who stay in hotels or work in hotels are likely to spend here and come back in they enjoy their experience,” said Councilwoman Stephanie Urillo. “I do believe we will see a positive impact in community from this.”