Ledyard — Trinseo, one of three companies operating at the Allyn's Point industrial complex in Gales Ferry, will stop production there by the end of this year, according to a news release.

The closure of the latex facility, which has been operating at Allyn's Point under various owners for decades, could cost the town $100,000 or more annually in lost tax revenue, Mayor John Rodolico said.

Rodolico said Trinseo, Dow Chemical Co. and Americas Styrenics have been paying about $300,000 in taxes to the town each year. Thus, he estimated the loss of Trinseo likely will take away a "minimum of one-third" of that amount.

Trinseo, a global producer of plastics, latex and rubber, said in its Sept. 17 release that it's closing the plant — and offering the 17 employees there separation packages — in an effort to reduce annual costs by $5 million.

The release does not specifically mention why the Gales Ferry plant was chosen to be shuttered but it cites "continuing declines in the coated paper industry in North America" as the driving factor.

Trinseo's Michigan plant will be expanded to handle customers who currently use the Gales Ferry plant, according to the release. Trinseo plans to demolish the Gales Ferry plant sometime next year.

Rodolico said he assumes Trinseo decided to leave the state because "Connecticut is a costly place to do business."

He noted that the other Trinseo latex plants, based in Michigan and Georgia, are in states that are "more competitive" than Connecticut.

Employees of the Gales Ferry Trinseo plant did not return a call seeking more information.

"First of all, it's losing a very good corporate neighbor and a very good corporate presence here in our town," Rodolico said of the closure's effect on Ledyard. "Beyond that it's another warning sign that we're getting here in the state about smaller companies. They're facing the same pressures — and more so, because they don't have large corporations backing them."

Going forward, Rodolico said the town will have to figure out ways to minimize the impact of two things: the shift of the tax burden from businesses to homeowners and the realities of an aging population.

"That means looking at innovative ways we can streamline government and provide an excellent education in a more efficient and economical way," he said. "That's going to mean regionalization, and that's going to mean talking with other school districts, towns and police departments about what can we do differently and how can we work together as region in order to anticipate some of these economic factors."

Dow Chemical and Americas Styrenics will continue to operate at Allyn's Point and have just more than 30 employees in total, Rodolico said.

l.boyle@theday.com

Twitter: @LindsayABoyle