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CT Construction Digest Friday October 16, 2020

The New New Deal of 2020

State Rep. Johnathan Steinberg and Michael Imber  People are reeling from the pandemic and Connecticut’s infrastructure is crumbling, endangering the state’s economic future.  We say “solve both problems:” Connecticut needs its own New Deal to rebuild our broken infrastructure and put our unemployed friends and neighbors back to work.

In 1935, President Franklin Roosevelt established the Works Progress Administration (WPA) as part of The New Deal.  The program employed more than 8 million people who built more than 1 million kilometers of roads, 10,000 bridges, airports, housing, municipal buildings, reservoirs, and all manner of infrastructure that many of us still enjoy today.  Here in Connecticut, the Merritt Parkway, Saville Dam and Barkhamsted Reservoir, and Danbury Airport are among the many shining examples of the WPA’s local achievements that put the unemployed of the Great Depression back to work and helped drive our economy’s recovery.

By contrast, the current federal government has failed to develop a national, coordinated plan to tackle the pandemic-induced economic crisis.  We need a state-centric approach, a Connecticut Works Progress Administration, to tackle our state’s 10.2% unemployment rate and relieve embattled households.

There are plenty of infrastructure projects to pursue; Connecticut has about 20 major infrastructure projects underway, from the I-91 Charter Oak Bridge to the Stamford Railroad Station Parking Garage. More than 7,300 miles of public roads are considered in “poor condition.”

Beyond transportation infrastructure, our needs are quite expansive and urgent, including:

  • Over $4.6 billion in wastewater infrastructure repair and replacement
  • $4 billion in drinking water infrastructure needs
  • Nearly $700 million in estimated school construction expenditures
  • Over 280 dams deemed “high hazard potential”

The biggest question is how do we pay for all of this?  Earlier this summer, Connecticut’s State Bond Commission approved borrowing roughly $550 million for projects.  While approximately 20% is designated for road and bridge repair, the vast bulk of the funding will go to new schools, hospitals, internet technology, and community policing.  Borrowing is fine when times are good, but the stress on state finances during a pandemic-induced recession makes borrowing more of a challenge.

Connecticut should embrace public private partnerships (P3) as a means of accelerating these infrastructure projects.  Private sector partners can utilize the “design-build-finance-operate-maintain” model that has been successful in other states like Colorado, Florida, Pennsylvania, Virginia, and Texas.  We can create incentives for these private sector partners to hire our unemployed citizens.

But the P3 concessionaires want a return on their money.  Availability payments use revenue streams like taxes, fees, and tolls to compensate the concession company, based on achieving project construction milestones and operational performance standards.  In exchange, the P3 concessionaire accepts certain obligations and risks, including construction cost overruns, late completion, and risks related to operations, maintenance, and rehabilitation.  Let’s face it: for highway projects, tolls would need to be the primary repayment source.  The decision made against tolls last December will have to be revisited.

The construction sector already employs more than 57,000 people in Connecticut.  We have 193,000 citizens that are unemployed. Not everyone will know how to weld, pour concrete, or swing a hammer, so we’ll provide training through Connecticut’s community colleges.

And when our friends return to work, they’ll spend their hard-earned paychecks on more groceries, household goods, cars, and, when public health officials advise, restaurants and other services.  All that new demand will create the need for more employees to provide those goods and services, stimulating the overall economy.

We should not forget how Connecticut’s recovery lagged the rest of the United States in the wake of the Great Recession of 2008-2009.  A Connecticut Works Progress Administration could be the vehicle to reestablish our state as an economic powerhouse in New England.

State Rep. Jonathan Steinberg serves the 136th Assembly District of Westport and the former Chairman of the Connecticut Pension Sustainability Commission; Michael Imber also served on the Commission and is a Managing Director of Conway MacKenzie, Inc.

CT leads New England charge to overhaul electricity market structure

Alexander Soule  Weeks after initiating a broad overhaul of utility regulation within its borders, Connecticut has recruited four New England states to rework the regional grid that is overseen by ISO New England, the independent system operator charged with ensuring a reliable supply of electricity from power plants.

In a written statement Thursday morning, Gov. Ned Lamont said the current structure “has actively hindered” states’ efforts to phase out polluting power plants in favor of renewable sources like wind turbines and solar panels, while increasing costs “to fix market design failures” in his words. Lamont’s energy policy chief Katie Dykes has emerged as a vocal critic of ISO New England’s structure and priorities, in her role as commissioner of the Connecticut Department of Energy and Environmental Protection.

“When Connecticut opted to deregulate our electricity market, we wanted the benefits of competition — to achieve lower-cost energy, compatible with meeting our clean-energy goals,” Dykes said in a telephone interview Thursday afternoon. “We have a partner [in] ISO New England, to manage this grid and design a market that is not thwarting our clean-energy goals, but achieving them; and not ignoring consumers’ concerns. ... That’s really what we are looking to do — reclaim the benefits of competition and regional cooperation.”

Lamont and his counterparts in Massachusetts, Rhode Island, Vermont and Maine plan to release a “vision document” in their words on Friday through the New England States Committee on Electricity.

The initial documents made no mention of New Hampshire, which likewise obtains electricity through the wholesale markets managed by ISO New England; and whose Seabrook Station is one two nuclear power plants in New England alongside Dominion Energy’s Millstone Power Station in Waterford. Gov. Chris Sununu’s office did not respond immediately to a query on why New Hampshire is not participating.

Connecticut and the four other states outlined a few broad goals that they will hone over the coming months. Those include creating a better market structure and planning process supporting the conversion to renewables; improving grid reliability; and increasing the accountability of ISO New England to the states and by extension their ratepayer households and businesses.

ISO New England spokesperson Matt Kakley indicated the Holyoke, Mass.-based nonprofit will “engage with the states and our stakeholders” on the governors’ proposal, in an email response to a query. He did not elaborate on any immediate opportunities or challenges inherent in the governors’ proposal.

“Maintaining reliable, competitively-priced electricity through the clean energy transition will require broad collaboration,” Kakley stated. “The common vision of the New England governors will play an important role in the discussions currently underway on the future of the grid.”

Renewable revolution

ISO New England launched operations in 1999, running auctions through which power plant operators bid to supply electricity, including against long-term projections for future needs that can only be met through the construction or installation of new generation capacity.

ISO New England falls under the jurisdiction of the Federal Energy Regulatory Commission rather than the states whose electricity supplies it is tasked with ensuring. That has led to pointed criticism from Dykes and Connecticut legislators that ISO New England is out of touch with the state’s push to switch to renewable sources of electricity.

Entering October, ISO New England published an updated outlook that revealed 60 percent of proposed power generators in the region’s future “queue” are wind farms, primarily offshore installations like the proposed Park City Wind project of Avangrid and Revolution Wind from Eversource. But Dykes recently criticized as unnecessary an NTE Energy plant approved already by ISO New England for eastern Connecticut, which will be fueled by natural gas if all other regulatory approvals are granted.

The six New England states participate in the Regional Greenhouse Gas Initiative that caps carbon emissions by individual power plants, while allowing them to purchase unused allowances from each other with that revenue funneled to the states to support renewable energy and conservation programs. FERC is now considering the concept of carbon pricing, which would levy a tax on power plants based on their emissions.

ISO New England is investigating the concepts of net carbon pricing and a “forward clean energy market” that would borrow elements of the existing forward capacity market, but designed to meet individual state objectives for the percentage of renewable power they want generated while ensuring adequate electricity is in place when weather does not cooperate.

The Connecticut Public Utilities Regulatory Authority is collecting on its own initiative industry input on modernization proposals that would add up to hundreds of millions of dollars, including utility-scale batteries to store power generated by offshore wind farms and solar arrays; and “smart” meters in homes and businesses to help electricity customers better manage their power use.

A New England Power Pool represents the interests of power plant operators, with NEPOOL’s chair stating Thursday morning the group was still reviewing the governors’ announcement.

“NEPOOL has been engaged this year in meetings ... exploring the transition to a future grid in New England and potential pathways forward to support that transition,” stated Nancy Chavetz, chair of NEPOOL, in an email.

Connecticut’s issues with ISO New England boiled over this summer on the heels of a power-purchase agreement between Millstone owner Dominion and transmission grid operators Eversource and United Illuminating, which contributed to a sharp increase in customer bills.

A few weeks ago, Lamont signed into law a “Take Back the Grid” act that allows the Connecticut Public Utilities Regulatory Authority to factor in Eversource’s and Avangrid subsidiary United Illuminating’s past performance in maintaining electric reliability, in addition to any future needs for revenue based on needed upgrades. The law included an element for Connecticut to initiate a study of ISO New England’s role.

Eversource and Avangrid have voiced support for the switch to “performance-based” regulation in Connecticut. An Eversource spokesperson on Thursday cited the company’s view that any changes to the operation of New England’s wholesale power markets should occur within the existing ISO New England structure.

“We also recommend any examination of potential alternatives includes a thorough evaluation that ensures unfair costs would not be imposed on customers,” Gross stated in an email.

In a statement forwarded by Avangrid spokesperson Ed Crowder, the United Illuminating parent indicated it intends to have “a voice in this process” with the goal of continued grid reliability amid increased adoption of clean energy sources.

East Hampton seeks firm to develop repair plan for school fields

Jeff Mill   EAST HAMPTON - The Town Council has approved a proposal that could lead to the renovation of the high school track, baseball fields and tennis court.

During the council’s regular meeting this week, the seven-member council unanimously approved a proposal to seek a qualified engineering firm to develop a plan for the improvements.

The council proposes using a mix of funds left over from the high school renovation project and money from a special revenue fund to pay for the project. Parks and Recreation Director Jeremy Hall said both the tennis courts and the baseball field are in need of full-scale improvements.

The track “has certainly passed the end of its’ life span,” he said.

Although “it is still in relatively good condition,” Hall and Director of Facilities Donald A. Harwood having been working for the past five years preparing for the eventual replacement of the track.

The tennis courts are repaired at the end of every season.

But cracks always seem to re-appear, Hall said, so much so that crews wind up patching the cracks.

The baseball field has had repeated issues with poor drainage, so much so that one year, the baseball team played all its 16 games on the road, Hall said.

“That was very trying for the players,” Hall said.

A team from the University of Connecticut School of Agriculture inspected the field, “and found that the groundwater level is fairly high in right and centerfield,” Hall said.

The school department did re-grade the infield and has sought to pitch the field so that it drains off to the side, Hall said.

After hearing about the issues, the council decided to bump them all into one (package),” Hall said.

The next step was the one that was taken this week.

The council approved a motion to issue a Request for Proposals that “will be used to hire third party professional” who would then submit “that the most appropriate design” and the projected costs.

A timeline developed by the council calls for “the receipt of proposals and contractor selection in November. Design would take place through January with bidding of a project in February,” according to the minutes of the meeting prepared by Cathy Sirois, the town’s executive assistant.

The contract for “the field work is expected to be awarded in March to allow construction in the spring and early summer, Sirois said.

In the meantime, Town Manager David E. Cox and Director of Finance Jeffrey M. Jylkka will work with the High School Building Committee “to formalize the plan to use High School funds,” according to Sirois’s minutes.

The council is expected to award the design contract in late November, and it is hoped the discussion about the school funds will yield a proposal for their use by then as well.

During the meeting this week, councilors Derek Johnson and Dean Markham suggested expanding the list of projects to include the Sears Park tennis courts as well.

But Cox said the town’s bond counsel had recommended limiting the project to just the three school facilities.

Groundbreaking today for Hartford’s DoNo phase 1 development

Liese Klein  Hartford Mayor Luke Bronin and developer Randy Salvatore are scheduled to break ground today on the $50-million first phase of the Downtown North redevelopment project, a  $250-million mixed-use project near Dunkin’ Donuts Park.

The first phase, south of the stadium at the intersection of Main and Trumbull streets, is slated  for 270 apartments, restaurant and retail space along with a 330-space parking garage. Ten percent of the apartment units will be priced as affordable housing, subsidized by federal funding through the city of Hartford. The first phase is set to be completed in 20 months, according to the developer.

The entire project, dubbed DoNo, is expected to be constructed over five years and will house nearly 1,000 apartments, restaurant and entertainment space and parking garages on land surrounding the stadium.

Bids due Oct. 30 for UConn’s former W. Hartford campus

Greg Bordonaro   evelopers are running out of time to bid on UConn's former satellite campus in West Hartford, which was recently put up for sale after New York-based fintech Ideanomics pulled out of a planned  $400-million development for the site.

A final call for purchase offers has been scheduled for Oct. 30, according to John Cafasso, a broker for Colliers International Group in Hartford, which is spearheading the property’s sale. 

A listing shows Colliers is seeking buyers for the roughly 58-acre site where Ideanomics once hoped to create more than 300 jobs at 1700 and 1800 Asylum Ave. There is no asking price.

Cafasso said a number of offers from third-party developers have already been made on the property, some seeking to develop the entire site or just parts of it. He wouldn’t provide further details on those bids. 

The goal is to have a buyer finalized by the end of the year, said Cafasso who added that the property is ideally suited for multifamily, medical office, retail, recreational and/or open space use for the community.
“I think all of that would be some type of vision for a big developer,” he said. “It’s just a question of how it gets developed over time.”  The Connecticut Department of Economic and Community Development had originally pledged a $10-million forgivable loan for the so-called West Hartford Fintech Village project, but the development was put on ice earlier this year after Ideanomics said it wanted to focus on its core business in the electric vehicle sector.

Ideanomics acquired the former UConn property in late 2018 for $5.2 million.

Colliers' property listing says the Asylum Avenue site is the largest to come to market in West Hartford in the last two decades. It currently houses four buildings totaling 157,662 square feet that were previously used as academic buildings by UConn.

“The campus is located in the northeast section of West Hartford, the most desirable submarket of Central Connecticut, and has excellent access to West Hartford Center and Downtown Hartford," the listing says.

Ideanomics first disclosed to investors in March that it had classified Fintech Village as a non-core asset that it would seek to divest. HBJ was first to report the development.

Glastonbury office condo complex receives town approval

Sean Teehan  outh Windsor developer TruNORTH Construction received the go-ahead from Glastonbury's Planning and Zoning Commission to build an office condominium park in town.

The $7-million project will create four new office condos at 219 Addison Road that will collectively hold 18 units, TruNORTH President Jeff Sawyer said. Each unit will be 1,350 square feet, and Sawyer hopes to have shovels in the ground by Dec. 1.

The COVID-19 pandemic has dramatically increased the number of people working from home, but Sawyer doesn't think that dynamic will keep businesses from buying space in the condo park. He said physicians, therapists and smaller financial services firms will still need physical space from which to base their operations, regardless of the pandemic.

 "Obviously we're taking a big risk," Sawyer said. "But we feel like it's an opportunity."

Further, Sawyer said, TruNORTH built a similar office condo project in Glastonbury about a decade ago, another difficult time for the U.S. economy.

"I feel like if I could get through the financial downturn, I can get through the pandemic," Sawyer said. 

The 2.5-acre property at 219 Addison Road is currently owned by 219 Addison Road LLC, which is controlled by Anthony J. Natale, town and state records show.

219 Addison Road LLC bought the property in 2017 for $247,000. The property is currently appraised at $237,700, town records show. 

The land is currently under contract for $535,000, Sawyer said, and the company will buy the property.

TruNorth has a history of building similar office condos in the area. The group built 33 condo units in South Windsor between 2004 and 2008, Sawyer said, and 12 in Glastonbury’s Somerset Square in 2010

Sawyer said the project will take about a year and a half to complete.

Windsor approves Amazon package distribution center

Abigail Brone   fter a lengthy discussion Tuesday night, Windsor's Planning and Zoning Commission unanimously approved plans to convert a vacant industrial building on Helmsford Way into an Amazon package distribution center.

The 154,496-square-foot building at 100, 80, and 60 Helmsford Way was constructed in 1994 and includes 24 acres of land but has sat vacant for over a year, property owner Adam Winstanley said. The application to repurpose the building was submitted to the town on Sept. 8.

The industrial building had housed Arrow Recovery, a company that refurbished computers and electronics.

As an Amazon package distribution center, the building would serve as the last stop before packages are delivered to the consumer, Brad Griggs, an Amazon developer on the project, said.

“What we’re looking at and considering is one of our ‘last mile’ distribution facilities,” Griggs said. “This is the last point in which an Amazon package stops before it hits your doorstep if the package originated at the existing Day Hill or Kennedy Road fulfillment centers where inventory is stored and packaged and starts the journey. This is where it would end.”

There will be little to no changes made to the outside of the building, with minor refurbishments made to the inside to better suit the new needs, Griggs said.

The site would mainly act as a loading center for the individual Amazon vans that deliver the packages to the surrounding area, Griggs said. The lot would hold about 225 Amazon delivery vans overnight.

The center’s peak activity, where workers are arriving in their personal vehicles and loading their Amazon delivery vans, would take place around 9:30 to 10:30 a.m., the project’s acoustic engineer Ben Mueller said.

While the vans are not as disruptive as tractor-trailers, the site plan includes the addition of a 20-foot sound barrier wall on the side of the lot abutting the residential neighborhood of Last Leaf Circle. An additional 6-foot-tall wooden fence will be added on the adjacent side, Mueller said.

Sound pollution was a main concern of residents, particularly the impact the noise will have on property values. Some residents called into the virtual meeting, which was held via Zoom, during the public hearing portion of the proceeding while others had emailed statements to the PZC beforehand. Many utilized Zoom’s chat function throughout the four-hour meeting.

Ackley Beaumont, a resident of Last Leaf Circle, asked that the entirety of the fences be soundproof walls.

“We all spend a lot of money protecting our property,” Beaumont said. “We don’t want to stand in the way of progress, but we don’t want our property to be devalued either.”

Robert Ellis, another resident of the abutting neighborhood, spoke out about the disruption the noise and traffic may cause.

“My wife and I are in our mid-80s,” Ellis said. “We can’t move again. What you decide controls what remains of our lives, as far as peace is concerned.”

Mueller assured residents that the loudest work conducted at the center would not exceed zoning regulations and would be less disruptive than previous tenants. Additionally, the most disruptive work would be staggered throughout the day, rather than taking place at one time, Mueller said.

“We have a lot of moving parts,” Mueller said. “They’re at various locations and moving in place. The trucks and the cars are designed to not overlap.”

Town Planner Eric Barz considered the plan an improvement from previous tenants of the building.

“This position is superior to if this application went away and Winstanley had to go with a more traditional industrial tenant,” Barz said. “We, as a staff, have done everything we can in the planning process and the applicant has done everything they can to mitigate concerns.”

Lamont signs bill aimed at redeveloping unused, contaminated properties

Michelle Tuccitto Sullo  undreds of polluted properties around the state have sat idle because they have fallen under the controversial law commonly referred to as the “Transfer Act.” 

Now, new legislation aims to give these properties a better chance at redevelopment.

Gov. Ned Lamont recently approved revising the law and instituting a “release-based” hazardous material remediation program common in other states.

According to Lamont, the change will promote the revitalization of environmentally contaminated, blighted parcels and put them back into good use, while helping municipal economies and ensuring environmental protection.

The Connecticut Property Transfer Act of 1985 originally was enacted to place restrictions on the sale of properties with environmental pollution so they could not simply be transferred unremediated from one owner to the next.

According to many in the real estate industry and municipal leaders, the law had the unintended consequence of leaving properties — some with only minor or even just potential contamination — ending up as idle eyesores.

The legislation sunsets the Transfer Act and institutes a new release-based regulatory program. According to Lamont’s office, instead of singling out certain properties with onerous requirements, the new system will focus on compliance in cases that pose the greatest environmental risk. It creates standards to guide cleanups of low risk spills “without a lot of red tape.”

The hope, according to Lamont, is that this new approach will make parcels that have been unused for years more attractive to private investors.

“This new law will streamline cleanups of contaminated properties, bring properties back to life,” Lamont said. 

In the past, some property owners abandoned locations due to the costs of remediation, the time involved, or the uncertainty. 

State Department of Energy and Environmental Protection officials have indicated there are about 4,200 sites around the state which have fallen under the Transfer Act. Only about 25 percent of them were ever cleaned up and transferred, officials said.

This meant fallow properties and lost tax revenue for municipalities.

State Sen. Christine Cohen, D-Guilford, said her district alone has had 134 different sites subject to the Transfer Act, including 73 in Branford, 25 in Guilford, 17 in North Branford, 14 in Madison and five in Durham.

In New Haven, state environmental officials have dealt with about 234 filings, with many properties having prior manufacturing, automotive and dry-cleaning uses. 

“The results in other states have proven that, with a released-based approach, more hazardous releases are cleaned up and there are fewer problems transferring properties from one owner to the next," Cohen said, after the bill passed the Senate earlier this month. “I believe this bill will get us moving ahead on economic revitalization while protecting Connecticut's soil, water and air at the same time."

The real estate community has been calling for changes to the state law for years.

Christopher Nicotra of Apollo Investment Properties of Fairfield predicted the change will attract more business to the state.

“The changes are phenomenal,” said Nicotra. “It will have a major effect on commercial real estate values over the years. There are properties that have languished for years, and this will help get them back to being used again.”

According to Nicotra, people have been unable to sell their properties if they were covered by the Transfer Act, as cleanups were cost-prohibitive.

“It’s exciting to finally see change,” Nicotra said.

For months, a working group of lawmakers, environmental and business professionals discussed what changes should be made to the law.

DEEP Commissioner Katie Dykes said both businesses and environmental leaders have been calling for reform.

“We are responding to that call, and will finally move to a more effective release-based cleanup framework that matches the rest of the country,” Dykes said. “This new approach will protect our environment and our communities while incentivizing smart, sustainable and environmentally informed development. DEEP looks forward to working collaboratively with stakeholders on the regulatory framework in the months ahead.”

David Lehman, the state’s commissioner of economic and community development, said the Transfer Act “kept investors on the sidelines and left communities stagnant with decaying memorials of Connecticut’s former economic might.”

“This new law will begin to remove barriers and, as a result, encourage new private investment in properties all across our state,” Lehman said.

Waterbury CPC approves “eCommerce” facility as new type of land use

Andrew Larson  WATERBURY — A proposed shipping warehouse for an online retailer is a step closer to reality after the City Plan Commission approved a recommendation to the Zoning Commission Wednesday night.

The City Plan Commission unanimously passed a positive recommendation for a zoning text amendment that creates “eCommerce Fulfillment and Distribution Centers” as a new type of land use in areas zoned for commercial arterial and industrial uses.

The Zoning Commission is expected to open a hearing on the proposal at its next meeting Oct. 28. Although the application is not specific to any site, the applicant needs the change to move forward with plans to build a 90,000-square-foot distribution center for what Trumbull-based developer Phil DiGennaro has said is a Fortune 500 company.

DiGennaro, operating as FSI Acquisitions, is working on the creation of a distribution center for Amazon in Danbury.

DiGennaro has not disclosed the name of his Waterbury tenant, but told the Republican-American earlier this month that he has an agreement to buy a property at 3800 East Main St. from Waterbury Retail Investments, conditional on completion of all necessary permitting.

The roughly 18-acre site had been earlier targeted for a Walmart Supercenter. The retailer abandoned its plans for the site in 2017, saying it was focusing on improving existing stores and expanding employee training.

During Wednesday’s hearing, an attorney for FSI Acquisitions pointed out the irony of an online retailer taking over a brick-and-mortar retail project.

“We have identified sites and sort of fittingly, or ironically, it is the former Walmart site,” said Attorney John Knuff, of Milford-based Hurwitz, Sagarin, Slossberg & Knuff. “I think that probably sums up better than anything the change that’s happened from people actually visiting the store to people ordering things online. And that’s really what’s driving this.”

Knuff called the proposal a “tremendous boon” to the city’s taxes that will help local businesses. He said there would be a “large number” of vehicles associated with the operation that would be registered in the city. There would be no maintenance of vehicles or gasoline on the property.

“When you have a large number of vehicles and a large number of employees who are driving those vehicles, they need gas, they need coffee, they need a sandwich,” Knuff said. “They probably need tires or some other work done to those vehicles. And they would all be visiting and frequenting your businesses, so it has synergistic positive effect.”

Mayor Neil M. O’Leary has said the roughly $25 million building project is expected to result in about 200 new jobs.

The City Plan Commission’s approval means the Zoning Commission needs a simple majority to approve the change, as opposed to the supermajority required if it has been rejected.