Special Board of Aldermen Public Hearing — May 20, 2020 Page 9
We will go the next slide. Here is a slide that looks at how will our tax base be affected if COVID-19 creates
a weaker economy in the mid or long-term. Of course, we are going to do everything we can and | will
discuss some of the steps, the action that the City is taking to try to assist our local businesses with recovery,
when the economy and as it opens. But the National Economists say there could be a recession. We know
that many businesses have revenue that is off very significantly, especially in certain industries like
hospitality, restaurants, other things like that, airlines. So the question is, will it erode our tax base and cause
property in the City to be worth less especially commercial property like malls, like strip malls, the regional
malls and other office buildings. The first bullet says, to be transparent and frank with you, we don’t for sure
what is going to happen. We don’t know if this will reduce commercial values or not. But the second bullet
tells you what the impact of lower commercial property values would be. It would mean that you would collect
less money from the commercial sector. The Malls, the Offices, the Strip Malls, the Restaurants. We would
collect less money from them which would push more tax burden on to the homeowner.
We haven't seen a huge, huge recession that impacted commercial properties heavily since the early 1990’s
but | was there, | was Mayor then. In a major recession, commercial values can do down much more quickly
than the value of single-family homes and condominiums for example. So you see the impact on the
commercial sector much more quickly if there is a recession, the decline in values if it comes is steeper for
commercial properties than for single family homes. We know that the economy will recover, but we don’t
know when and that’s the truth of it. That’s the kind of hard reality, we are hoping, we are praying that things
will come back pretty quickly and within a short time, we will be back to where we were before. But we don’t
know that for sure, there could be a recession. Nashua’s economy has always been strong, Nashua people
work very hard, work well together so | have full confidence that we will come back by sticking together, but
we don’t how long that might take.
Now let’s go to some of the immediate effects we must consider or take into account when we are thinking
about the Budget. First of all, we know that right now many Nashuans are hurting. No question about it. We
know from the State’s statistics that more than 8,200 people from Nashua have applied for unemployment
benefits since March; this is just since March, middle of March, over 8,000 people. That is a lot of people.
Now those people may return to their jobs as the economy opens, but right now, 8,200 people and more are
unemployed. And | say “and more” because this only includes the people from Nashua who applied for
unemployment because they work for a New Hampshire company. It does not include our Nashua residents
who work in Massachusetts and have been laid off or furloughed down there. We don’t have a firm figure on
how many Nashuans have been affected down in Massachusetts but we do know that 30% of the people
who are employed here in the City, commute into Massachusetts. So we know that more than it could be 10,
11, we don’t know, but we know that significantly more than 8,000 people are currently unemployed.
The State is saying that the COVID-19 unemployment is 15.8%. So these are difficult economic
circumstances. Many of our fellow Nashuans are suffering from this. The Federal Government has provided
a supplement to unemployment benefits which is great, but that’s not going to last forever. Now, again, |
have full confidence that we can recover, but we can’t look at these statistics and all of this information, we
can’t listen to people who are out of work and how worried they and their families are, | certainly have talked
to a number, without taking into consideration that recovery may not be immediate. We may have to work
hard over a period of time to make sure we come back strong. So here we are going to the next slide,
please. The slide has frozen, | don’t know what’s happened.
John Griffin, CFO
| am having trouble with it.
