Beacon Falls OKs O&G Industries data center, tax relief for residents

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CT Data Center manager Bill Corvo gives a presentation during a special town meeting April 21 at the Beacon Falls Senior Center regarding construction of a new data center. Residents unanimously approved the project at the meeting. Andreas Yilma Citizen’s News

By Andreas Yilma Citizen’s News

BEACON FALLS — Construction of a new fuel cell data center got a green light from residents and town officials.

Torrington-based O&G Industries, a construction company, will build a data center on its roughly 47 acres in the area of Gruber Road, Railroad Avenue and Lopus Road. The land has an appraised value of $846,000. O&G has owned the land for more than 20 years.

Nearly 20 residents unanimously approved in a special town meeting April 21 a resolution authorizing the execution of an agreement between the town and CT Data Center, a subdivision of O&G. First Selectmen Gerard Smith and CT Data Center manager Bill Corvo both signed the deal after the meeting.

A data center is a place where banks, hedge funds or financial industries store and house cloud information. The cloud involves software and services that run on the internet rather than locally on an individual computer.

Gov. Ned Lamont signed a bill into law that went into effect in July 2021 for the state Department of Economic and Community Development to offer tax incentives for data center operators to locate their facilities in the state.

This allows operators to pay the municipality and skip sales, use and financial transaction taxes, Corvo said.

The Board of Selectmen originally approved the resolution at its April 11 meeting.

The two-story, 294,164-square-foot facility will house a 32-megawatt data center and have 70 parking spaces. About 111,000 square feet will be designated for computers. The development includes a fuel cell technology power plant to produce renewable electricity

Natural gas lines will power the fuel cells, Corvo noted.

“This is a very clean project,” he said.

O&G engineering manager Matthew Tobin said if the facility’s fuel cell system goes down for a period of time, the center will still be connected to the grid and have backup generators.

The developers also are working with town officials to bring in a natural gas pipeline for the project and the downtown corridor.

“That provides another source of energy for the whole community,” Corvo said.
He said the center will adhere to local noise requirements.

Residents will see tax relief once the project is up and running, Corvo said. Through a host municipal fee agreement, the company will pay $1.5 million in the first year after issuance of the certificate of occupancy, $2 million in the second and $2.5 million in the third. After the third year, the fee will rise annually at a rate of 2% on the base payment of $2.5 million, which will result in an increase of $50,000. That bump will be compounded yearly.

The town’s tax rate for the 2021-22 fiscal year is 34.9 mills, which translates to 1 mill equating to about $505,000. Once the center comes online, residents could see 12% in tax cuts, Corvo said.

Residents at the meeting were either interested or pleased with the data center concept and had nothing bad to say.

Mary Ellen Fernandez asked the Board of Selectmen if it encountered any downside for the town.

“There isn’t a downside,” Smith replied. “It’s only an upside.”

John Betkoski, chairman of the Economic Development Commission, said he’s known Corvo for 20 years.

“He (Corvo) does his homework and this one, it’s the big three Es: energy, environment, economic development. He’s covered all of it,” Betkoski said. “Not only does he do a great job, but he’s got a great partner in O&G. This is a win-win for the town of Beacon Falls.”

Smith added, “I’m excited for the possibilities of what this is going to do for the tax base of Beacon Falls and that we have a great partner like O&G. … It’s a good night in Beacon Falls.”