FAIRFIELD, CT — Political and business leaders gathered Tuesday at Fairfield University to discuss the impact of last year’s departure of General Electric from its Fairfield campus and the future of the state and local economy.
“With GE leaving, there is a lot of uncertainty,” Mark LeClair, an economics professor at the university, said. “The summit creates a space for politicians and the business community to discuss ways to move forward, and provides citizens a place to ask questions.”
Fairfield First Selectman Michael Tetreau said that since only 200 jobs were moved out-of-state, the overall impact on the real estate market and the local economy was minimal — it was the timing of GE’s departure that hurt.
“It was a hit on our prestige and a hit on the psyche of Connecticut,” Tetreau said.
Ken Flatto, a former first selectman of Fairfield, echoed Tetreau’s sentiments saying that the move created “an enormous corporate hole in the soul” of the town he used to lead.
Most painful for town, Tetreau said, was the sale of the property to Sacred Heart University.
According to the first selectman, this removed over a million dollars out of the tax base “at a time when the state cut an additional $15 million.”
Tetreau, though, does not doubt the positive long term influence of Sacred Heart on the town, adding “We just need to get through the short term hits to get to the long term benefits.” Tetreau said Fairfield is currently looking to the future with a long term plan that focuses on mixed-use zoning and walkability.
Large office parks like the one GE occupied in Fairfield since 1974 are becoming relics as technology in the workplace has changed how people work.
GE announced its departure from their sprawling campus off the Merritt Parkway, last January. Until November, when GE sold the property to Sacred Heart for $31.5 million, the company had been Fairfield’s largest taxpayer, contributing $1.8 million to the town’s coffers in 2015.
The campus will now, perhaps ironically, be home to Sacred Heart’s Jack Welch School of Business, named after GE’s former CEO. As a nonprofit university, Sacred Heart is exempt from paying taxes. Instead the school qualifies under the state payment in lieu of taxes – or PILOT – program. According to the CT Post, the state’s most recent payment to the town was for $2 million or about 30 percent of the potential income from Fairfield and Sacred Heart Universities and state-owned properties.
GE moved its headquarters to Boston because, according to an Atlantic interview with CEO Jeff Immelt, the company “wanted to get to a city” so that it could “be part of an academic setting.” Immelt went on to say that in Boston they would be “in the middle of an ecosystem… You’re where the ideas are.”
In Fairfield, Immelt told The Atlantic that he would look out his office window and he “saw nothing.”
The move to Boston is a part of a major adjustment for GE, which also sold off a satellite campus in Stamford. The jobs from Stamford will move to GE’s Norwalk office where the more than 500 employees from the Fairfield campus were transplanted, last year.
Looking to the Connecticut’s future, both Sen. Tony Hwang, R-Fairfield, and Rep. Brenda Kupchik, R-Fairfield, said the unpredictability of the state’s fiscal situation was harming the state’s business climate. Hwang, who has opened an exploratory committee for statewide office, added that the state doesn’t have a revenue problem. Rather it has a “spending discipline problem,” he said.
Rep. Cristin McCarthy Vahey, D-Fairfield, said that while the state was in a vulnerable position, now was the time to “grow on our strengths,” particularly by increasing educational cooperation between high schools, community colleges and universities to ensure students are prepared to join the workforce.
Trumbull First Selectman Tim Herbst, who has also opened an exploratory committee for statewide office, said that he was optimistic because the state is a geographic linchpin connecting New England and the tri-state area. He also added that the state should be hopeful because of the “changing composition of legislature on both sides of the aisle” that included “new faces” who understand that the legislature’s impact on local communities and that the state’s problems, in particular pension reform, must be “faced head on.”
Joe McGee, vice president of public policy and programs for the Business Council of Fairfield County, agreed saying that solving the state’s pension problems is a “prerequisite for economic growth” but that GE’s move tells us something else about the future of Connecticut’s economy.
“The digital revolution is as big the industrial revolution” McGee said. “We are changing the way we’re working and it’s changing the workforce we need and where they live. That is the great challenge for Connecticut.”