 
Under a new U.S. Department of the Treasury program, Fairfield County is to receive nearly $90 million to jumpstart the municipal bonding process supporting large construction projects, including private developments.
Connecticut is receiving a total $225 million under the Build America Bonds program, which is subsidizing bonds through tax credits to holders of bonds or to state and local government issuers.
Investor interest in Build America Bonds has been tempered by worries over disclosure requirements the government may unveil, according to Thomas Doe, CEO of Municipal Market Advisors, a Concord, Mass.-based consultancy with a Westport office.
Since passage of the American Recovery and Reinvestment Act, nearly $1 billion in stimulus funding has been committed to projects and initiatives in Connecticut, according to the office of Gov. M. Jodi Rell.
U.S. Rep. James Himes of Greenwich had been stumping for such a program, including at a municipal bond meeting this month in New York City sponsored by the Securities Industry and Financial Markets Association where he said the bond market was stuck in “vapor lock,” as quoted by Bond Buyer newspaper.
The State Bonding Commission has cancelled four of its first seven scheduled meetings to date in 2009, with the next meeting scheduled for June 26. At its most recent meeting, the commission approved an $825,000 loan the Department of Economic and Community Development had sought to assist in the relocation of Henkel Corp., which is moving its North American headquarters from Pennsylvania to Rocky Hill. If Henkel maintains at least 80 jobs at the facility, the state will forgive the loan.
DECD also sought $2 million to replenish its Economic Assistance Bond Fund, used to provide up to $500,000 to support individual economic development projects.
Under the federal program, projects would have to be located in so-called recovery zones, economically depressed areas that the government provides communities broad latitude in defining. Build America Bonds cannot be used for golf courses, spas or gambling venues, among other prohibitive uses.
Some $11 million and $10 million are being set aside for Stamford and Bridgeport respectively, with the remaining $67 million for projects in other parts of Fairfield County. Waterbury is to receive $14 million, the most of the state”™s five largest cities.Â
The U.S. Treasury apportioned the funding according to relative employment declines in 2008.
Across the New York border, Yonkers and Westchester County are in line to receive $69 million in bond recovery funds, a fraction of the $925 million the Empire State is slated to receive under the program.
Stamford alone tendered proposals for stimulus funding to support 70 projects, including several major projects such as the creation of public parks in the vicinity of the Harbor Point development of the city”™s South End being led by Norwalk-based Building and Land Technology Inc. At deadline, Stamford”™s director of economic development Michael Freimuth said he could not comment on how development in the city would be impacted from the new funding.
The BLT project is one of several in Stamford that has moved ahead despite the economic downturn, in contrast to other projects across Fairfield County that appeared to get sidetracked after the real estate and credit markets showed signs of derailing in 2007.
Those projects include the 95-7 mixed-use development in Norwalk; the Fairfield Metro Center complex; the redevelopment of an abandoned mill in Redding for mixed residential and commercial use; and the Steel Point project in Bridgeport.
The sluggish bond markets have also affected nonprofit hospitals and universities. An official with the Connecticut Health and Educational Facilities Authority told the newspaper Bond Buyer that Bridgeport, Norwalk and Stamford hospitals have all delayed capital projects due to the higher interest rates they would be forced to take on.
