Plan Interests Selectmen—

Tech Firm Gets Support For Short-Term Tax Abatement

By John Voket

Thirty-year Newtown resident and co-founder of Advanced Fusion Systems (AFS) William Joyce said he is betting on a “seven for seven” track record of success in piloting business startups, as he asked the Board of Selectmen for a five-year property tax abatement. And the selectmen apparently liked those odds, strongly supporting the plan to provide a five-year property tax freeze to the company and forwarding that recommendation on to the Board of Finance and the Legislative Council.

The local executive and his Chief Financial Officer Robert Powell came before the selectmen June 6, along with Newtown’s Community Development Director Elizabeth Stocker and several current and past Economic Development Commission officials to support and explain the expected benefits the company can bring to the community provided its startup proceeds as planned.

Referring to a presentation document, Mr Joyce discussed how he and a group of investors successfully completed the purchase of one of two sprawling industrial buildings near the intersection of Commerce and School House Hill Roads, adjacent to Interstate 84, that were previously occupied by Pitney Bowes.

The announcement that the firm would establish its headquarters in Newtown came after a number of zoning and wetland hurdles were cleared. The project could bring 200 or more jobs to the community by 2015, most paying $100,000 per year or more.

While Mr Joyce said he could not assure selectmen that AFS would launch successfully and thrive, considering a “75 percent probability that startups don’t make it,” he remained convinced that AFS, his seventh startup endeavor, will become a thriving tech destination that he expects will draw other similar support companies to Newtown or the region.

The local business entrepreneur may be buoyed by a commitment from New York’s Con Edison to be the first in line to purchase 10,000 “current limiting devices” that will be among the company’s leading products offered to nongovernmental consumers. Those devices, about the size of a five-gallon bucket, are fitted to utility lines, allowing additional power to be carried while eliminating intermittent power surges that are the leading cause of damage to individual utility customer’s appliances and other electronic equipment.

In addition, Mr Joyce said he has solid interest from one foreign government that could spend about $6 billion for another piece of AFS technology, which Mr Joyce claims will protect sensitive computer and mechanical devices from the kind of electronic pulses generated by air burst nuclear explosions and highly occasional but intense solar flare activities.

It may sound like the stuff of science fiction, but Mr Joyce assured the selectmen that his company has the ability to manufacture such a system — the first of its kind to be successfully implemented since the first nuclear devices were tested more than half a century ago.

Massive Power Consumption

First Selectman Pat Llodra and colleagues Will Rogers and William Furrier listened intently as Mr Joyce explained the technical requirements the Newtown facility would demand, including the need to occasionally create an extreme burst of electrical energy from a supply with the capacity to power “the entire city of Waterbury” concentrated into a millisecond of time.

Those tests, which simulate the aforementioned nuclear pulse, will be conducted in steel-lined chambers with specifications in excess of those used to house nuclear missiles, Mr Joyce explained, but would be virtually imperceptible to passersby on School House Hill or Interstate 84.

As construction at and outfitting of the 211,000-square-foot facility ramps up in the coming weeks, the current staff of four working in the office area of the building will begin growing, with manufacturing expected to commence as early as this winter, and no later that the spring of 2012, Mr Powell told the selectmen.

Ms Stocker presented documentation that detailed stipulations the company requested under the relatively new Business Incentive Plan that was initiated by the EDC about three years ago to help attract and retain particular types of commercial operations in town, who were committed to building, occupying, and improving existing industrial properties.

The development director said that the vacant Pitney Bowes facility was a substantial liability in a region and at a time when large companies were scaling back and downsizing. Saying the new AFS headquarters is one of the top ten commercial properties in town by size, she and EDC members were concerned when it became vacant about a year-and-a-half ago.

“You don’t want a facility of this kind to remain vacant for too long,” Ms Stocker said. “Two-hundred-thousand square feet is not easy to fill.”

She said without an occupant, such a facility would grow less desirable as a relocation prospect by the day, and the inability to find an occupant would quickly begin affecting the grand list (of taxable commercial properties) and the quality of life in Newtown.

While the total abatement equals $336,055 in deferred property taxes, the company will still pay the town its current net taxation, which will total $721,855 during the same period. During that time the estimated taxable assessment is expected to nearly double, from $5.9 million today to more than $10.5 million when all anticipated building and outfitting of the facility is completed.

Full Assessment In 2016

The firm would begin paying taxes on the increased assessment in July of year six, or 2016, if the incentive plan is approved by finance and council officials in the coming weeks. That final assessment is based on not only the existing structure and anticipated taxable personal property on site in five years, but an additional 30,800 square feet of new manufacturing or testing space yet to be built.

During questions from the selectmen, Mr Joyce responded to Mr Rogers’ query about a possible need for additional space, if AFS’s success demands expansion. The company founder said he might consider occupying the adjacent second Pitney Bowes complex, which fronts School House Hill Road, once and if it becomes available. But Mr Joyce said he would also consider building at the Batchelder property, a closed and long-dormant aluminum smelting brownfield site in Botsford.

The company official said that he knows there is currently extensive PCB contamination at that location, but said another AFS-patented device — a high beam laser — could be employed to vaporize PCB particles as far as 20 feet underground, clearing the site for future occupancy.

To that Mr Rogers quipped, “Take the Batchelder property and we’ll double the tax incentive.”

Other benefits besides the possibility of anchoring a series of new high-tech commercial occupants in the area will include the installation of high capacity electrical lines along Edmond Road, as well as a natural gas feeder line. Both would be accessible to other current or future developers of industrial or manufacturing space in the vicinity.

Mr Joyce also suggested that due to its hybrid, first-of-its-kind testing technology, AFS may also become a sole source testing facility for other government projects. He added that AFS anticipates building one or more independent power generating facilities on the Edmond Road site in the next few years to supplement electricity delivered by the regional electric utility.

Mrs Llodra said she expects the finance board to consider the incentive recommendation when that board meets Monday, June 13.