South Windsor's CT Studios Project Clears Major Hurdle

Connecticut Studios cleared another huge hurdle on Friday by signing a power purchase agreement with Connecticut Light & Power for a 5-megawatt fuel cell.

“I hope this is a signal of a new fresh wind and we can now work together to bring the project to fruition,” CT Studios consultant Craig Stevens said. “The Connecticut Studios team - and I  include members of this council as members of that team - do not quit. We will see this through to completion. A studio was promised and a studio is coming.”

It’s the latest piece of good news of the long-developing project that was initially proposed in 2008.

In April, the developers announced that it secured $14 million in private financing, in addition to $5 million from the state to build the project.

“It’s the biggest hurdle,” Town Manager Matthew Galligan said in relation to the power purchase agreement.

And it took time to clear that hurdle, as the town sought to avoid having to take out bonds to finance the infrastructure.

“I always felt it was a good project,” Galligan said. “Good projects need time to muster your resources. You have to look at every financing possibility to keep the debt low on a project such as this.”

On Friday, the Town Council in a special meeting voted to extend the reverter clause for a 20-acre parcel of land that the town provided the developers for the project.

The deed contained a deadline that states that the land would revert back to the town if construction had not started by October 2012. The deadline has been extended by the council five times, including the extension on Friday.

The latest extension shifts from June 30 to July 15, when the full council can discuss the latest developments for the project. Galligan said that he preferred to have the extension done that way so members of the public could view the meeting on television and have an opportunity to weigh in.

Galligan said that the only barriers left for the project was for the Council to work with the National Development Council to set up the 501(c)(3) to set up a government rate for the infrastructure and ensure the infrastructure truly is public.

Building permits could be pulled as early as within 30 days, Galligan said. In addition, other things such as PURA’s review, obtaining the remainder of the land and having the fuel cell go through the Siting Council still have to be done.

Not bad for a project that has been derisively called by one town staffer as “Big Foot.”

“I was a doubting Thomas until I saw legitimate financing from First Niagara,” said Mayor Tom Delnicki, noting that lately CT Studios reminded him of the infamous Snow Valley project from the late 1990s that did not come to fruition.

But the financing change his mind.

“That told me that things were coming together, that a reputable financial institution is offering credit that the developer needed to do the project,” Delnicki said. “Then the state legislature approved a continuation for movie credits that fit model of CT Studios. Without that, the project could not go forward. Now we have the PPA.”

Town Councilor Ed Havens agreed.

“I was running out of patience to be honest with you,” Havens said. “The delays have been a blessing in disguise. When I hear from citizens from the community, they still don’t believe it. They believe it is some kind of folly. They won’t believe it until they see it. It’s gonna take some more explanations from us. … I won’t believe it until I see it.”

Town Councilor Keith Yagaloff said that the delays were as a result of the council ensuring that the project would be a successful one.

“There was a lot of emotion at the beginning,” Yagaloff said, noting the work of Councilor Kevin McCann to ensure the town was protected. “Many councilors felt it was not sustainable. It was a junk-bond project. At the end of the day, those junk bonds could not be sold. ... The council was cautious not to support the project. Publicly people should know the council acted appropriately to bring it to this point.”