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Data center development may take another step forward in Wallingford

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WALLINGFORD — The Planning and Zoning Commission is slated to hold a public hearing Monday on whether to allow data centers on the east side of town.

Under proposed zoning regulation changes, data centers would be allowed by special permit in the Industrial Expansion (IX) and Interchange District (I-5) zones.

Data centers house a network of computers for central storage, management and dissemination of electronic information. It is the place where information stored in “the cloud” is actually kept.

Although Gotspace Data Partners LLC is working to bring data centers to Wallingford, the zoning text amendment is not being proposed for its exclusive benefit, town officials said.

Tim Ryan, Wallingford’s economic development specialist, said last month that the Economic Development Commission has been pursuing data center users in town for five years.

“We want to have the ability, and we completely support having the ability, for Planning and Zoning to allow these by special permit,” Ryan said, “so they can take and evaluate and put necessary restrictions on buildings if they happen to be close to residential neighborhoods.”

The IX and I-5 zones are located in the rural northeastern part of town and are surrounded by residential zones.

Gotspace needs the zoning changes to move forward — currently data centers are not defined or addressed anywhere in the regulations — but Ryan sees a strategic gain in allowing data centers in general.

“One of Wallingford’s strengths is the diversity in its grand list,” Ryan said of the list of all taxable residential, commercial and industrial property in town.

“Having a diverse grand list is very important to the sustainability and
consistency in tax revenue,” he said. “One way that we could strengthen that is to take and pursue more modern types of businesses. What's more modern than data centers?”

Current developer

Although the zoning changes would benefit any data center developer, Gotspace is the company currently working to secure all of the necessary agreements to build in Wallingford — in addition to pursuing sites in Groton, Norwich, Griswold and Bozrah.

Gotspace sought and received a municipal host fee agreement with Wallingford, approved by the Town Council in June of last year, and a market price power supply agreement with the Wallingford Electric Division in September.

The Town Council still needs to sign off on the power supply agreement.

In November, the Town Council discussed whether the town should rescind its host agreement with Gotspace.

Some councilors felt they were rushed into accepting the agreement back in June. Others were reacting to a decision by the Bozrah Planning and Zoning Commission to reject a proposal to create a zone that would allow data centers, a plan requested by Gotspace, after no one from Gotspace showed up.

Ryan said that a denial of the application would have happened anyplace if the applicant didn’t arrive to present its case.

“No one should read into that, (or draw the conclusion) that that means that we shouldn't do it here,” Ryan said.

Noise concern

Several residents of the neighborhoods surrounding where Gotspace is proposing to build have been outspoken in their objection to the plan, citing noise, vibration and other quality of life concerns.

Ryan said that, as a lifelong Wallingford resident, he doesn’t want to be an economic developer who recommends projects just because it’s his job and that aren’t in the best interest of the town.

“No one understands how many times I've said to companies, ‘this is not the best fit for you, you may want to consider going someplace else,’” he said. “I am convinced that data centers are the single best opportunity that we could possibly ask for.”

Neighbors have cited noise as one of their top concerns. Ryan said that the noise comes from cooling systems on the roof of the buildings and the diesel backup generators in emergencies.

Because the areas are zoned as industrial, no matter how it's developed there's going to be some level of noise, he said, and the strength of Wallingford’s host agreement is that it includes noise mitigation standards, expanded setback distances from the roadways and the use of natural earth berms and natural sound barriers like trees.

A critical part of the zoning text amendment is that it allows data center development via special permit only. That means land use officials have the power to really scrutinize each application, down to each individual building.

Some of the site plans include seven buildings, and the PZC will be able to approve them one at a time, with more stringent noise conditions and other conditions of approval for buildings situated near residential areas.

“This is not a one size fits all,” Ryan said. “If you've got someone who wants to do a 10,000-square-foot data center, which is very, very small in comparison to the 150,000-square-foot data center, then why would you hold them to the same noise mitigation expenses and strategies that you would have bigger data center...”

Corporate changes, Verde group

In the last month, Gotspace has gone through some personnel changes,

Thomas Quinn is no longer CEO, according to the company website. The new CEO is Nicholas Fiorillo, the other company founder.

Fiorillo, a Boston-based real estate manager, was owner of Ocean Development Partners LLC — a defunct company that was was collapsed under a Chapter 7 court order in March 2021 with the same owners and registered address as Gotspace’s creditors, Gotspace Data Equity Fund One, LLC.

Gotspace also has hired a chief operating officer, Mike Grella, and a director of operations, Jake Phelan.

Grella worked for Amazon from 2012 to 2019, rising to director of economic development, before starting his own economic development and public policy advisory firm in 2019, according to a statement from Gotspace.

Phelan’s education and work experience includes the fields of corporate finance, marketing and retirement plan management.

Quinn was formerly president and CEO of Verde Group LLC — another data center development company that is part of a $33.8 million judgment handed down in Hartford Superior Court last month.

The judgment was made Dec. 21 against Verde Group and three other defendants in a lawsuit regarding a failed plan to build data centers in Montville in 2019.

Verde Group and its founder Joel Greene — who died July 24, 2021, according to court documents — were sued for non-payment to contractors and foreclosed land over the Montville project.

According to court documents, Verde Group and the other defendants defaulted on a $34 million mortgage taken out in April 2018. The lawsuit was filed by the project’s creditors in September 2020.

In June 2021, the creditors were granted authority to garnish $36,554,200 from the defendants.

Since the creditors had already garnished $2.7 million, the amount was reduced to $33,824,772 in a writ for attachment and garnishment — a court order to seize property to settle an unpaid debt which freezes a defendant’s assets — handed down Dec. 21.

It's unclear whether Quinn was still serving in his Verde Group position when the allegations in the lawsuits would have taken place. Multiple attempts to reach him for comment were unsuccessful.

LTakores@record-journal.com203-317-2212Twitter: @LCTakores

Wallingford zoning district map. The IX zone identifiers are in yellow, the I-5 zone is in red and residential areas are in blue. The gray shaded area shows the Watershed Protection District.
The new conceptual plan of the North Farms data center campus in Wallingford, as presented to the Town Council on June 8, 2021. Courtesy of Gotspace

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