“Providence is Open for Business”
Tonight, the City Council approved a Tax Stabilization Agreement (TSA) for a new development to be located along Parade Street across from Dexter Park. This is significant for the City, and it signals to developers and other businesses that even though the COVID-19 pandemic has caused severe financial hardships, growth and new building continues to happen.
“When you look at how much the City has suffered financially from the ongoing pandemic, it is rewarding to see developers that believe in our future,” stated Councilman John J. Igliozzi, Esq. and Chairman of the Council’s Committee on Finance. “TSAs are an important tool to help developers create new developments and spur growth in the City. As we know, the City is facing a serious housing shortage, and I believe that the developer is committed to ensuring equity and affordability along with much-needed new units.”
This project will repurpose and rehabilitate an existing abandoned historic structure and add a new building to the neighborhood. They are creating jobs during the building phase and new residential units. The developers have stated that they intend to keep them affordable and in line with current rents in the community.
Currently, the City realizes around $32-Thousand in taxes annually from this property. At the end of the agreement, taxes realized by this property will be over $400-Thousand. The TSA the developers have applied and were approved for is a 15-year TSA and they have committed to reaching specific benchmarks:
- 10 percent of the dollar value of the construction will be used to hire women and minority-owned businesses;
- The developers with the Director of First Source Providence to hire local trades people for the construction;
- The developers have agreed to make a reasonable faith effort to buy all construction materials locally from vendors within the City of Providence;
- The developers have agreed to ensure that 100 percent of the hours worked on the project will be performed by trade construction subcontractors who have or are affiliated with an apprenticeship program;
- The property owner will also make annual payments of five percent of the abated tax for each year during the agreement to the City Council Parks and Recreation Fund.
Additionally, 10 percent of all tax revenue realized from the project will be earmarked for the Providence Affordable Housing Trust Fund. In October of 2020, the Council approved the Providence Redevelopment Agency to capitalize the Fund through a $20-Million bond, which is anticipated to make up to 1,500 affordable homes possible in the next three years.
To read the full ordinance, click here: https://bit.ly/37stlN1