In rare move, neighbors form LLC, raise big bucks to battle development
WESTPORT — It’s not uncommon for neighborhood groups to form in opposition to a proposed development, but forming a limited liability company is a rare move that comes with some serious teeth.
Westport Neighbors United, a group that coalesced in March to fight against an application for an 81-unit affordable housing complex on Lincoln Street, has taken that extra step. They’ve also raised $50,000 to go to battle with.
“I would not say it’s usual, but I wouldn’t say it’s unheard of,” land-use attorney Timothy S. Hollister with the Hartford-based firm Shipman & Goodwin said of Neighbors United’s formation of an LLC.
The one other time Hollister, one of the state’s leading attorneys in regards to affordable housing cases, said he saw an opposition group create an LLC was in 2016, when the state proposed to relocate its firearms training ground to Willington. Hollister represented a group of residents who formed an LLC called Unwillington Inc. and successfully got the state to withdraw its proposal for Willington and proposed the new firearms training ground for Griswold instead.
“I think groups do it to give some formal structure rather than someone running the organization out of the back of their car,” Hollister said.
Financial reasons may also motivate opposition groups to form LLCs, he said. “They might be more likely to get a tax-exempt status if they have a corporate structure.”
Both Westport Planning and Zoning Director Mary Young and local developer David Waldman said they have never encountered a development opposition group from an LLC, but said this was perhaps only because they never checked a group’s legal status or thought to ask.
Westport Neighbors United LLC registered with the state on April 13 as a domestic limited liability company, according to the secretary of the state’s website. Neighbors United member Rod Larsen is listed as the company’s manager and Richard Bailey, one of the group’s leaders is listed as the primary agent of the company. The company’s address is listed as Bailey’s home on Riverside Avenue, near the Lincoln Street proposal.
“I don’t know why it happened that way. I think the people in our group in charge of the banking end were asked by the bank if this is a personal account,” said Tina Torraco, who lives on the corner of Riverside Avenue and Lincoln Street and is one of the group’s leaders. “We’re certainly not a nonprofit, so they chose LLC. It had nothing to do with anything, just a banking technicality.”
To date, Westport Neighbors United has raised almost $50,000 in donations to fight the application, brought by Cross Street LLC, to build a six-story, 137,000 square-foot building on Lincoln Street near downtown Westport. The application proposes 30 percent of the building’s 81 units will be designated affordable housing and was submitted in accordance with the state’s 8-30g statute created to promote the construction of affordable housing.
Because the application qualifies for 8-30g status, town’s Planning and Zoning Commission can only deny the application on the grounds of a “substantial public interest,” such as fire or traffic safety concerns. Westport does not yet have sufficient affordable housing in the eyes of the state and, therefore, has not received a moratorium on 8-30g applications, which prevents developers from bypassing town zoning regulations.
“We get donations from concerned citizens who are supporting our cause, some from residents. We have a following of about 300 people who are concerned primarily about two things: safety and the general disruption of the area,” Torraco said. “The checks keep flowing in, which is a nice thing.”
The Planning and Zoning Commission will hold its final public hearing on the Lincoln Street development on Sept. 27 in Westport Town Hall and is likely to make a decision on whether to approve the application by Oct. 11, according to the commission’s chairman Paul Lebowitz.
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