PROVIDENCE, R.I. (WPRI) – Calling it a “powerful tool” to woo businesses to the vacant I-195 land, Providence Mayor Jorge Elorza signed an ordinance Thursday that will provide special tax deals to developers on the former highway space in downtown.
The new policy grants a 15-year tax-stabilization agreement to projects worth at least $10 million and 20-year deals to five still-unidentified projects worth more than $50 million, so long as developers agree to make an effort to hire minority contractors and that all trade construction contractors offer apprenticeship programs.
“We can’t just wait for investors to come to us,” Elorza said during a morning press conference in City Hall. “We have to go out and aggressively and proactively market our city and state and this gives us another tool do so.”
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Elorza was joined by leaders from across city and state government, including Senate President M. Teresa Paiva Weed, House and Senate Majority Leaders John DeSimone and Dominick Ruggerio, City Council President Luis Aponte and state Commerce Secretary Stefan Pryor.
Under the ordinance, the 15-year deals will be what city leaders call “administrative tax stabilizations,” meaning they would not need City Council approval. The first five 20-year tax breaks will be approved by the I-195 Redevelopment District Commission and any future deals would need to win support from the mayor’s office and the council.
For the 15-year tax breaks, developers will pay no taxes in the first year, followed by three years of land taxes, before gradually increasing tax payments on the assessed value of the property over the next 11 years. The 20-year projects will be tax exempt for three years, pay land taxes for two more years and then begin paying taxes based on property value.
Elorza’s signing of the ordinance comes after the City Council unanimously approved it twice over the last week. At two public hearings held by the council Finance Committee earlier this month, the policy received overwhelming support from developers, union leaders and policymakers.
Pryor, the commerce secretary, said the tax-stabilization policy along with a series of economic development incentives that were included in Gov. Gina Raimondo’s first budget make up a “true high-quality toolbox” that is “unprecedented” in Rhode Island.
“Now it won’t be overnight that we accomplish our goals, but we’re truly getting started,” Pryor said. “We’ve pounded on the table and then negotiated across the table, now we need to pound the pavement and work the phones and bring development to Rhode Island.”
Elorza said he’s hopeful the new policy will help with the proposed life-science complex that CV Properties and Wexford Science & Technology wants to build on two parcels of the I-195 land.
Separately, Elorza also expects to sign another ordinance approved by the council Wednesday that will award six-year tax-stabilization deals to commercial projects valued between $250,000 and $3 million in abandoned properties in “opportunity neighborhoods,” communities identified as being populated with the highest rate of residents with low-to-moderate incomes.