Dormitory developer getting a tax break
DERBY — The owner who transformed the former Marshall Lane Manor nursing home into a dormitory housing international high school students and pumped more than $1.5 million into the makeover, will receive a nearly $50,000 tax break over the next three years.
The Board of Aldermen on Thursday voted 7-2 in favor of giving David Guerrera, founder of APEX International Education Partners, or AIEP, the city’s first tax break since a new tax incentive program was implemented in October.
Aldermen Barbara DeGennaro and Thomas Donofrio cast the dissenting votes.
Guerrera received approval in December 2017 from the Planning and Zoning Commission to convert the vacant former nursing home at 101 Marshall Lane into a dormitory to house up to 110 international students, who attend private schools throughout the state in prep- aration to attend American colleges and universities.
Guerrera has since put $1.5 million into the renovation of the 35,000-squarefoot building, and plans to invest another $500,000 to finish the makeover, according to Carmen DiCenso, the city’s economic development liaison, who served as chairman of the tax incentive committee.
The project qualified for a tax incentive under the adaptive reuse of a property, which enables a three-year tax abatement to a developer who invests $500,000 or more into improving an existing property. Guerrera will receive a total of $47,732 off his taxes over the next three years.
DiCenso said the property previously generated $21,000 per year in taxes as a nursing home, but now is generating nearly $80,000 a year for the city’s tax rolls with the improvements made by Guerrera. Even with the tax break, the property still will generate some $65,000 per year. And DiCenso said with Guerrera on track to make another $500,000 in improvements, the property will continue to generate even more taxes.
“He (Guerrera) took a dilapidated building and put $1.5 million into it. ... I welcome people like this to come to Derby and give them a tax break for investing in our city,” DiCenso said.
Derby has never had a tax incentive program, but a committee was formed last year to create an ordinance to help the city grow its Grand List and entice new businesses to come here and encourage existing ones to expand.
While the majority of the aldermen had no issue granting Guerrera a tax break, DeGennaro questioned whether the property qualified because the ordinance was just approved last October, yet Guerrera’s project was approved in December 2017. She questioned whether the break should be granted “retroactively,” as she said the ordinance says it cannot, and if the property fell under an adaptive reuse, since the ordinance states the property must boost some historic or architectural significance.
The city’s attorney said the aldermen have some “discretion” with the language in the ordinance, and suggested if there are issues, the aldermen can tweak it and remove some of the language regarding the historic or architec- tural aspects.
Aldermanic President Charlie Sampson said the intent of the adaptive reuse was to “have people take an existing building and invest in it,” and “not necessarily” be a building of historic significance.