Nonprofit Struggles with Indebted Ansonia Land

ANSONIA – A Bridgeport nonprofit is saddled with thirty acres of Ansonia land and $200,000 in unpaid taxes. It’s trying to get rid of both.

The Downtown Cabaret Theatre Company, which has put on shows in Bridgeport for fifty years, saw a potential windfall when Bob Scinto — a commercial real estate developer and chairman of the cabaret’s board of directors – offered to donate vacant land at 405‑R Birmingham Boulevard to them in 2020. The property sat undeveloped next to the new Farrel Pomini plant, on a stretch of road built with private investment from Scinto.

Scinto himself was looking to clear his hands of the property. No one wanted to lease it, he said, and commercial leasing is Scinto’s business. He thought that, by turning the land over to the cabaret, they’d be able to sell it and turn a nice profit. The cabaret saw it as a welcome gift for a theatre company hit hard by the pandemic economy.

“I saw it as an opportunity to help the cabaret out,” Scinto said.

“It was a lovely idea at the time,” said Hugh Hallinan, the cabaret’s executive director. ​“I figured at that point, at most, we could hang on to it and sell it at some point and make some money that is badly needed for the survival of the theater.”

But then reality – in the form of state tax laws – set in.

In Connecticut, land held by a nonprofit is not automatically tax-exempt. The law states that this land is only exempt if it’s used to further the nonprofit’s core mission. 

For the cabaret, this means they would need to use the space for performances. The law also specifically excludes land from tax exemption if it’s being held for commercial development – which is what the cabaret wanted to do.

Hallinan said that the cabaret hired an outside attorney to do due diligence on the property, but that the question of taxes never came up.

Nine days after the property was transferred, the new year rolled around. With it came the first property tax bill for about $25,000.

“I assume that the cabaret was given bad advice,” said John Marini, Ansonia’s city corporation counsel. 

Bills Mounting…

This was the first of many bills that would pile up on the lot, which today remains undeveloped

The cabaret began trying to work out deals with two parties: the city, which wanted to recoup taxes owed, and Farrel, the neighbor, which could use the land to expand its next-door plant.

Hallinan said that the city initially refused to buy the land because of taxes owed from when Scinto owned the property, which were less than $30 total at the time of the transfer. 

He said that a verbal deal had been worked out, but that the tax assessor’s office had stepped in and prevented the sale. The city’s assessor and tax collector said this is not accurate.

In 2022, with over $100,000 of debt accumulated, the cabaret turned its sights toward Farrel. 

They entered a contract under which Farrel would buy the land for $106,000 – but Hallinan says he signed the contract prematurely.

“I had conversations with a few board members, and jumped the gun, and signed that letter without a full vote going forward,” Hallinan said. He said that some members of the board expressed reservations when they were later presented with the contract. ​“So that was a mistake that I made.”

In 2023, assuming the deal was dead, Hallinan sent a letter to the city offering to donate the property in lieu of taxes. The Valley Indy previously covered this letter. 

The Ansonia Planning & Zoning Commission gave a positive referral to the city. The next step was to get the donation approved by the Aldermen. 

But the Aldermen never discussed the referral.

At An Impasse

That’s because, after the PZC submitted its referral to the city, Farrel gave the city a call. They still wanted the property.

“Farrel came in and said: hey, wait a minute,” Marini said. ​“And we said, okay, if there’s a contract, we’re not going to get in the way of that.”

Hallinan said he made the offer to the city because he wasn’t sure where the deal with Farrel stood. He said the city had a better line of communication with Farrel than he did.

“My assumption was that there were conversations happening in the background, and so if Farrel wasn’t going to move forward on it, maybe I should give it back to the city, and then the city can just deal it directly to Farrel,” he said. ​“I was taking some blind shots to see if I could just move the deal along.”

With the local government deferring to Farrel, the cabaret was stuck.

The cabaret reached out to Farrel again in August and December of last year, according to Hallinan. But closing the deal continued to be easier said than done: more taxes had accrued since the contract was signed, so its details would need to be reworked.

Now, with the real estate saga entering its fourth year, no one is quite sure who’s going to end up with the property. 

Hallinan said that Farrel had recently reached out again. 

Marini said the city may foreclose on the property or put it out to auction if the deal doesn’t go through soon. 

And Scinto is frustrated with what became of his gift.

“The town can do whatever they want with the property,” Scinto said. ​“The cabaret can’t pay the taxes on it, so if they need to foreclose on the taxes, they should foreclose.”

The interest compounded again on Feb. 1. That’s another couple thousands of dollars added to the debt.

The Valley Indy left several voicemails to Farrel’s legal counsel seeking comment on this story, which were not returned.