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Monday, October 3, 2011

Wallingford council OKs tax deal for Leigus Road office building

As published in the Record Journal, Wednesday September 28, 2011

By Robert Cyr
Record-Journal staff
(203) 317-2224


— Workstage Connecticut LLC, the developer working to complete the building that will be the future headquarters of Anthem Blue Cross, will be exempt from 20 percent of its property taxes for the next seven years after being accepted into a tax abatement program by the Town Council Tuesday night.

Workstage is the seventh-highest taxpayer in town, with property assessed at $20,151,880. The annual break on Workstage’s tax bill will be $55,467.

The company, owned by New York-based Gale International, resumed construction this year at 110 Leigus Road. Anthem was originally slated to move into the space this month but has not done so due to incomplete work, said Donald Roe, town program planner.

The 305,000-square-foot building, which was partly completed in 2007, was originally built for Mortgage Lenders Network USA Inc., but that company went bankrupt shortly after the subprime mortgage industry imploded the same year.

“I think there’s been some slippage in their schedule,” Roe said before Tuesday night’s council meeting. The move-in date is a moving target.”

Gale and Anthem representatives did not return calls Tuesday.
Workstage spent about $20 million on the project and is finishing up construction for Anthem’s move after years of inactivity, scheduled for completion in September 2012. Anthem will occupy 217,764 square feet of the campus.

A certificate of occupancy from the building department will trigger the first year of the program for Workstage, said Town Attorney Janis Small. If Anthem were to leave the location, Workstage would be held to the same standards to stay in the tax program by seeking another tenant.

Councilor Craig Fishbein said Workstage also owns property at 1427 Barnes Road and is negligent on its taxes there, making the company ineligible for the program.

Joan Malloy, a lawyer from local law firm Loughlin Fitzgerald representing Workstage, told the council that the taxes have been paid and appeared negligent due to a clerical error that had been recently corrected.

“Anthem will definitely see the benefit of this incentive program, and it was a significant influence on what got them to come here,” she said.

According to the tax collector’s office, Workstage paid $483,654 in taxes last year and will pay $277,339 in 2011. The property’s assessed value was cut in half during this year’s revaluation, dropping from $20 million to $10 million.

“We are thrilled with this project — it has been a long time in the making,” said Richard Nunn, chairman of the Economic Development Commission.

To be eligible for the program created in 2005, a business must make at least a $12 million investment in its property, and employ a minimum of 1,200 people in a space of no less than 60,000 square feet. The property will be revaluated again in 2016.

As stipulated in the agreement, Workstage must repay its tax abatement savings if there is a reduction in the workforce size that puts it below 1,200 jobs, Roe said.

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