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CT Construction Digest Tuesday July 7, 2020

Berkshire Hathaway takes stake in big CT natural gas pipeline
Alexander Soule
With Berkshire Hathaway’s $9.7 billion planned acquisition of Dominion Energy’s natural gas transmission business and accompanying debt, a major pipeline in western Connecticut will be getting a new stakeholder amid continuing investment in the system.
If approved by the Federal Energy Regulatory Commission, the deal would give Berkshire Hathaway some 7,700 miles of transmission lines, along with storage facilities and a minority share in a liquefied natural gas export terminal in Maryland of which it will assume operation. It is one of just six such LNG export facilities in the United States. The transaction includes a 50 percent stake in the Iroquois Gas Transmission System which runs nearly 50 miles through western Connecticut, and which has its main office in Shelton. Iroquois’ other major owner is TC Energy, known until last year as TransCanada, which led the design and construction of the pipeline three decades ago.
On Monday, Dominion CEO Tom Farrell II said Berkshire Hathaway expressed interest in a deal early this year, with Dominion having acquired its pipeline system via a 2000 merger with Consolidated Natural Gas. Over the weekend, Dominion and Duke Energy confirmed plans to scotch a proposed Atlantic Coast Pipeline they had hoped to build between West Virginia and North Carolina, citing legal challenges. “To state the obvious — permitting for investment in gas transmission and storage has become increasingly litigious, uncertain and costly,” Farrell said on a Monday morning conference call. “This trend, though deeply concerning for our country’s economic growth and energy security, is the new reality which threatens the pace at which we intended to grow these assets.”
The Connecticut Public Utilities Regulatory Authority does not regulate interstate pipeline operators directly, according to Commissioner Marissa Gillett, save in cases of safety inspections in coordination with federal regulators.
“PURA ... does not have any jurisdiction to approve or disapprove the transaction between Dominion and Berkshire,” Gillett stated Monday in an email response to a query. “PURA will monitor the FERC proceeding and may intervene, if appropriate.”
New equipment for Brookfield, MilfordThe Iroquois Gas pipeline route traverses upstate New York from a station on the St. Lawrence River, entering Connecticut in Sherman and passing through portions of New Milford, Brookfield, Newtown, Monroe, Shelton, Stratford and Milford before cutting across Long Island Sound. At a Brookfield compressor station, the Iroquois pipeline bisects Enbridge’s Algonquin Gas Transmission system that runs east to the Rhode Island border.
Comprised of gaseous methane, natural gas is funneled from underground wells via “gathering” pipelines to centralized processing stations, where gas is fed into transmission pipelines. Those pipes span 20 inches to 42 inches in diameter, running underground about 70 miles to intermittent compressor stations that use turbines to pressurize the gas anew as it is forced along its journey to customers and end points.
Iroquois is seeking FERC permission to add a new building at its Brookfield facility that would house a pair of turbines to compress gas further, allowing it to quickly increase gas capacity in its Connecticut system as needed during cold snaps and other periods when demand peaks. It also plans to add equipment in Milford to cool gas as temperatures increase due to the compression process. The project would include the installation of “vent recovery” systems designed to capture emissions that would otherwise be released into the atmosphere during maintenance and inspections.
The most recent significant expansion of Connecticut’s inbound natural gas flow occurred five years ago, when new pipelines and supporting infrastructure increased capacity by 16 percent.
Power plants fired by natural gas produced half of Connecticut’s electricity as of March, according to the most recent estimates from the Energy Information Administration, with NTE planning to add to that predominance in seeking permission to build a $500 million natural gas plant in Killingly.
Dominion’s Millstone Power Station nuclear plant in Watertown produces most of Connecticut’s remaining electricity load, with the state aiming to increase its renewable generation capacity through offshore wind farms in the early stages of planning.
About 35 percent of Connecticut households use natural gas, EIA data shows, with retail suppliers including Connecticut Natural Gas and Southern Connecticut Gas, both owned by Avangrid; and Eversource Energy. Combined, the three companies had more than 600,000 Connecticut customers, with several alternative suppliers also registered with PURA to bill for natural gas on a retail basis.
Berkshire Hathaway’s existing Connecticut holdings include the Wallingford-based real estate agency Berkshire Hathaway HomeServices New England Properties, as well as General Reinsurance and another reinsurance division based in Stamford; Duracell which has its main research facility in Bethel; and H.H. Brown Shoe based in Greenwich. Other household names pepper Berkshire Hathaway’s list of operating companies including Benjamin Moore, Fruit of the Loom, Geico and Oriental Trading.
Berkshire Hathaway Energy is based in Des Moines, Iowa, and has one natural gas facility in the Northeast in the Saranac power plant in Plattsburgh, N.Y.
The Dominion deal comes a week after Oklahoma City-based Chesapeake Energy declared bankruptcy, with $11.8 billion in debt against assets of $16.2 billion and coming off an $8.3 billion loss in the first three months of this year that left it with $82 million in cash entering April.
Chesapeake Energy is credited as a pioneer in the process of hydraulic fracturing or fracking, a process by which a sandy slurry is pumped into underground wells to fracture the walls and tease out additional oil or gas. Last week, Covia filed for bankruptcy as well, with the company created in the 2016 merger of an Ohio company with Unimin, based at the time in New Canaan.

New Bassick High School to be located at University of Bridgeport
Linda Conner Lambeck
BRIDGEPORT — After months of speculation, city officials announced Monday that a new Bassick High School will be built at the University of Bridgeport, adjacent to and including its soccer field.
The city will pay $6 million for about 6.29 acres of land bounded by the foot of University Avenue, Lafayette Street and Broad Street, 11 parcels in all, and enter a 99-year lease — at $1 a year — for the soccer field, which adds another three acres to the deal. The soccer field was built in 2007 with new artificial turf installed two years ago.
Mayor Joe Ganim, at an afternoon news conference at UB, called the move historic.
“It’s huge,” Ganim said. “It starts the chain of events that will transform this site on this multiple-university campus as a state-of-the-art high school for Bridgeport students.”
Not to mention a paradigm shift for the city’s South and West ends, added City Council Member Jorge Cruz Sr., whose district includes UB.
The city has been working for years to replace Bassick High School, the last of the city’s comprehensive high schools to be rebuilt.
In 2018, the plan was to rebuild the now 91-year-old Bassick at its Fairfield Avenue site but a suitable location could not be found to move the school’s 808 students during construction. Last year, a developer approached the city about purchasing the former Hubbell factory site on State Street for a new Bassick.
Thomas Gill, the city’s planning and economic development director and chief negotiator, said that beyond some environmental concerns, the Hubbell property’s size — roughly eight acres — was tight when it came to giving Bassick something it has never enjoyed: athletic fields. “It’s good to have a number of options,” said Gill. “Hubbell was convenient, but there was the problem of the size and the busyness of State Street.” Gill said the price for the UB acreage was less than what was asked for the Hubbell property. One member of the city’s School Building Committee said they were told Hubbell might have cost closer to $9 million.
The plan is to level Bodine, North and South Halls — all one-time dormitories — and replace them with a school and parking. The state’s share of the $115 million high school already has legislative approval. Officials say the new location should not add to the overall cost of the project. It could bump out the school opening to sometime in the 2022-23 school year.
Gill said Robert Berchem, chairman of the UB Board of Trustees and partner in the law firm that represents the school board, was not a party to the negotiations. Ganim, however, said at one point during the search for a new Bassick site that he did call Berchem to ask if there was any room on UB’s 60-acre campus for a state-of-the-art high school.
UB announced last week it is planning to join forces with several higher education institutions if it gets the green light from accrediting bodies. Once complete, it is believed UB would cease to exist. The campus would become a “university park.”
Still, Schools Superintendent Michael Testani called the UB campus an ideal location for a new city high school.
“I see it as a win-win,” said Testani, who like Ganim, is a UB alum.
UB Interim President Stephen Healey called the news a big deal for the high school students who will learn on the campus.
A host of city officials and local state legislative representatives were at the announcement. So was Goodwin University President Mark Scheinberg, whose East Hartford institution stands to be the prime recipient of UB real estate once the university partnership is approved.
Goodwin has three magnet schools on its East Hartford campus, Scheinberg said.
“(Bassick) students will come to think college as a given,” Scheinberg said. The new Bassick is expected to focus on advanced manufacturing. It also has an auto shop and recently entered a deal for students to build an airplane from scratch.
Bridgeport Board of Education Chairman John Weldon said school board and city school building committees both asked tough questions about the proposal.
None of those questions were asked in public as the decision to place Bassick at UB was kept confidential until Monday, even after the UB campus was hinted as the location.
The city’s School Building Committee openly discussed the former Hubbell site for months and even voted to seek an appraisal of the property. It is unclear how authorizations for appraisals of the UB site occurred.
City Council member Marcus Brown, a co-chair of the building committee, said Bassick at UB will change the lives of hundreds of students.
He said the soccer field — home to a national NCAA Division II championship for the UB women’s soccer team in 2018 — could also “change the game” and luck of Bassick soccer players.
Jessica Martinez, a school board member whose son goes to Bassick, said she is excited for the students.
“They go through so much,” Martinez said. “Having a positive environment for them to come to, a future to look forward to and a career path — it’s going to be a blessing for them.”

Fate of Newington's Anna Reynolds school now in voters' hands
Erica Drzewiecki
NEWINGTON – The fate of Anna Reynolds Elementary School is now in voters’ hands.
Newington Public Schools and the Town of Newington are planning a fall referendum for the proposed $35.5 million project, to renovate the school as new. Officials have applied for a school building grant from the state of Connecticut, to cover more than half of the estimated cost.
The Town Clerk is expected to set a referendum date ahead of the Nov. 15 deadline in order for grant consideration by the state Bond Commission. After the date is set, (likely Election Day Nov. 5) school officials can no longer publicly discuss the project according to voter regulations. That leaves advocates for the long-awaited renovation this summer to plead their case
“This has been on the horizon for quite some time,” Superintendent of Schools Dr. Maureen Brummett said. “With Anna Reynolds being over 50 years old there are substantial needs to update the facility. This project would essentially upgrade the entire school.”
In the last two decades, other schools in town have been modernized and brought up to speed to accommodate 20th century learning. In addition to renovations made at the other three elementary schools, focused academies were founded at John Wallace and Martin Kellogg Middle Schools as well as Newington High School.
Built in 1954 as Northwest Elementary, the Anna Reynolds facility is not in compliance with the Americans with Disabilities Act (ADA). Despite temporary repairs to ensure its safety, the 65,269 sq. ft. structure has a failing roof and inefficient, outdated plumbing, electrical and HVAC systems, as indicated by the results of a building needs study.
Parents, teachers and administrators from the school community begged the Town Council to consider the renovation during several public meetings this past winter. They cited foul odor, leaky ceilings and other obvious signs of deterioration as challenging and potentially hazardous conditions for learning.
Councilors went on a tour to see the school for themselves, even hearing from Principal Jason Smith how first-graders had started calling the water collecting in one classroom their “waterfall feature.”
“The kids have gotten used to it, unfortunately,” Smith said, adding that custodians and teachers worked hard to ensure the school’s high reputation for success was not compromised by the building’s issues.
The town agreed to prioritize the project. Building committee meetings have been ongoing and Colliers International was hired as construction manager in the spring.
Since the district implemented a distance learning program during the pandemic, classes met virtually March through June and the building has basically been vacant.
“Prior to the shutdown we did have at least two public information sessions, including an open house for parents,” Brummett said. “Now we’re doing our best to get the word out this summer.”
She anticipates the district is “very likely” to receive the grant, with a manageable impact on residents’ tax bills due to the town’s excellent bond rating.
“At the end of the day the project will cost taxpayers somewhere between $16 and $19 million,” Brummett said. “We’re working with the finance director to analyze the town’s debt service and determine the impact on the average homeowner.”
Construction would commence as soon as summer 2021, for an expected completion by Dec. 2022. School would remain in session while renovations are underway.

Some CT companies borrowed up to $10 million in forgivable funds from Paycheck Protection Program
Ana Radelat and Kasturi Pananjady
Although most Connecticut companies approved for loans from the Small Business Administration’s Paycheck Protection Program borrowed far less money,  50 Connecticut companies — including large real estate, manufacturing and law firms  — applied for the maximum of between $5 and $10 million.
According to information the SBA released Monday, Connecticut offices of the Shipman and Goodwin and the Robinson & Cole law firms received Paycheck Protection Program loans of between $5 to $10 million.
So did a number of Connecticut manufacturers, including Ulbrich Stainless Steels & Special Metals;  Fuelcell Energy, Inc.; and the Berlin Steel Construction Company.
None of the companies immediately responded to requests for comment.
“When we understood the intention of the process, we withdrew,” Cady said.
The Paycheck Protection Program, or PPP, has been credited with saving millions of jobs during the pandemic. It provides companies with SBA-backed loans at very low interest rates and allows loan forgiveness for payroll costs for a 24-week period.
The program has loaned about 60,000 Connecticut companies, including the Connecticut News Project, publisher of the Connecticut Mirror. The total loan amount to Connecticut companies and non-profits is between $5 billion and about $9 billion. The SBA provided information on the size of loans larger than $150,000 in wide ranges.
But there have been problems.
The PPP program also received criticism for initially allowing hundreds of other well-capitalized firms to receive the loans and for sometimes contradictory rules issued by the Treasury Department and the SBA.
Monday’s release of the nationwide data  revealed that private equity-backed chains and companies owned by members of Congress received money from the Paycheck Protection Program, provoking calls from lawmakers for new restrictions on the program.
“This data— long-overdue— raises increasingly serious questions about possible mis-allocation of PPP funds,” said Sen. Richard Blumethal, D-Conn., “I’ll be closely scrutinizing the list and seeking investigation of any misguided decisions, favoritism or wrongdoing.”
The information released Monday by the SBA was a compilation of data about loan applications that had been approved by local SBA-backed banks. “However, the lender’s approval does not reflect a determination by SBA that the borrower is eligible for a PPP loan or entitled to loan forgiveness,” the SBA said. “Because a borrower is listed in the data as having a PPP loan does not mean that SBA has determined that the borrower complied with program rules or is eligible to receive a PPP loan and loan forgiveness.”
For instance, Elm Hill Manor, an assisted living home in Vernon, was listed among the companies approved for a $5 million to $10 million loan. It was, but Elm Hill manager Lisa Cortese said her bank made a mistake, the home sought only $50,000 and was eventually approved for a PPP loan in that, much smaller, amount.
“We obviously redid the paperwork,” Cortese said.
She also said her company was in dire need of the federal help, especially when it was forced to fight for personal protective equipment for its staff. “We did what we had to do,” Cortese said.
The PPP program was initially established by the CARES Act and initially funded at $349 billion. After those funds quickly ran out, the federal government replenished the program with an additional $310 billion.