October 12, 2017

CT Construction Digest Thursday October 12, 2017

Excavation, testing of former R-J site continue as part of redevelopment

MERIDEN — Workers continue to test and excavate contaminated soil at 11 Crown St. in advance of the construction of dozens of mixed-income apartments.
City Economic Development Director Juliet Burdelski said cleanup work on the site of the former Record-Journal building began about three weeks ago. Testing was scheduled for Wednesday, and the city will know if additional excavation is required by next week.Lead and ash have been found in soil underneath the former parking lot. Workers have tested and used an excavator to remove soil, and repeated the process.
“It’s not anything we weren’t aware of,” Burdelski said.Michaels Development will construct 81 mixed-income apartments units on the site once remediation work is complete. The complex will consist of 24 market-rate units, 37 affordable housing units for residents at or below 60 percent areawide median income or low income, and 20 units for displaced residents of the Mills Memorial Apartments, classified as very low income.
The building was constructed in 1905 and purchased by the city for $450,000 in 2014 with plans for redevelopment. A study found the building couldn’t be repurposed.
Demolition of the building began in June and was completed in August.
The apartments will be part of several completed, ongoing, and future projects in the downtown area, including the construction of the Meriden Green, the new train station, and the Meriden Commons on the site of the Mills Memorial Apartments.
The developer of a retail center near Rentschler Field announced Wednesday that construction has started, with a grand opening set for November 2018.
The first phase of The Outlet Shoppes at Rentschler Field is to include “70 leading fashion and lifestyle retailers” occupying 282,000 square feet of leasable space, Horizon Group Properties announced. Additional phases are to encompass 140,000 square feet and include 30 to 35 stores.
The shops “will serve as a compelling tourism magnet for the region, as well as a powerful economic driver,” the developer’s news release said. “It will cater to more than 140,000 people who work within three miles of the center.”
The development’s architectural style is to reflect the property’s aviation history and feature restaurants, a food pavilion and a central courtyard with an outdoor fireplace and a children’s play area. Horizon cited a study that predicted the shops would generate $223 million in state sales tax over 20 years. The first phase is to provide about 1,000 full- and part-time jobs.
Last week, the town council unanimously approved a tax break of up to $16.86 million for the development. The incentive is to extend over 10 years, with 100 percent of taxes forgiven during the first two years and a decreasing percentage over the next eight years. The breaks would come from deferring the increase in the real estate assessment on the property, or the difference between the value of the vacant land and the value of the development.
The tax break could be less than the agreed upon $16,858,093, but it is capped at that level, town Finance Director Michael Walsh said. The agreement also requires Horizon to occupy the space for 10 years after the shops open, or the tax abatement would end, Walsh said.
The town still expects to see about $9 million in real estate taxes over the 10 years and an additional $2 million over the same period through personal property tax revenue from each of the 70 retailers. Walsh estimated that the personal property tax revenue could bring in between $150,000 to $225,000 in the first year. CLICK TITLE TO CONTINUE

Eversource, Avangrid artificially constrained gas pipeline capacity for years, report argues

A new academic analysis argues gas utility subsidiaries of Avangrid and Eversource have artificially constrained gas pipeline capacity in New England for years, driving up natural gas and electricity prices and potentially violating federal laws.
The systematic withholding of pipeline capacity, particularly on the coldest days, has cost New England electricity consumers $3.6 billion in higher prices over the past three years, according to “Vertical Market Power in Interconnected Natural Gas and Electricity Markets,” a new white paper posted by the Massachusetts Institute of Technology on Wednesday. A group of university researchers working with the Environmental Defense Fund found that local gas distribution utilities owned by the two holding companies regularly scheduled more gas than they needed on the Algonquin Pipeline in Connecticut and Massachusetts, only to cancel some of the orders later in the day — too late for the pipeline space to be resold.
This practice, referred to as down-scheduling, “essentially locks up some pipeline capacity,” said Matthew Zaragoza-Watkins, an assistant professor at Vanderbilt University and co-author of the report. On the worst days, including during the Polar Vortex of 2013-2014, up to 7% of Algonquin’s capacity could be artificially constrained.
“When you relate that back to gas-fired generators, that’s about 28% of the gas that would be demanded,” Zaragoza-Watkins said.
This “capacity withholding,” researchers wrote, “increased average gas and electricity prices by 38% and 20%, respectively, over the three year period we study.”
Eversource officials called the report “a complete fabrication” and denied engaging "in any behavior to underutilize capacity to 'artificially constrain capacity.'"
"The pipeline capacity we reserve is done so to meet the needs of our customers, no other purpose," Media Relations Manager Tricia Taskey Modifica wrote to Utility Dive. Avangrid did not return requests for comment.
It does not appear either company broke any contract laws or market rules with their behavior, researchers said. But if the report’s findings are accurate, industry lawyers say they could amount to violations of federal law — and become one of the biggest price manipulation scandals since the California energy crisis. CLICKTITLE TO CONTINUE