PROVIDENCE, R.I. (WPRI) — Providence Mayor Brett Smiley says the city has asked the McKee administration for $45 million in exchange for taking over control of the state-owned Cranston Street Armory.

Smiley told reporters Thursday the city proposed the state could spread out the funding over a couple of years, expressing he’s willing to work with Gov. Dan McKee to make the deal work across different budgets.

City and state officials have been negotiating behind the scenes in the wake of McKee deciding earlier this year he thinks the city should take over efforts to rehabilitate the deteriorating historic building that’s been a hotbed of controversy recently.

“The governor was receptive to that conversation,” Smiley said. “I understand certainly from my time in state government that he has to work within the pots of funding that he has, and so we’re working through what those various funding streams might be and the discussions are ongoing.”

Asked about the $45 million proposal, McKee spokesperson Matt Sheaff said terms are still being negotiated and discussed.

“A final agreement has not yet been reached,” he said. “We look forward to our continued conversations with the Mayor and his team.”

In records first requested by The Providence Journal and later obtained by Target 12, the Smiley administration acknowledged the significance of the building.

“The Armory is an important piece of Providence’s history and should be used as an asset to spur economic development, contributing to the vitality of the neighborhood and city where it’s located,” Smiley’s chief of staff Emily Crowell wrote in a July 7 email to McKee’s office. 

Smiley acknowledged Thursday it could be months before any money is allocated, especially if legislative approval is needed. The General Assembly would need to approve any new funding proposals from the governor, unless the money comes from an already-existing pot of funds.

“If by some stroke of luck, from my perspective, the state wanted to give us one big check and walk away, that would be just fine,” Smiley said. “But if it needed to be spaced over several years, that could work as well, because it’s a multi-year project. This is a big project.”

The July 7 email to McKee’s office proposed the state could provide $20 million in fiscal year 2023-2024, $15 million in fiscal year 2024-2025, with the remaining $10 million in fiscal year 2025-2026 in order for the city to care for the building and make necessary infrastructure improvements.

“This investment would ensure that the building is transferred responsibly with a clear plan for future success,” Crowell wrote.

Earlier this month, the mayor told Target 12 he was wary about city taxpayers having to pay for years of deferred maintenance that’s built up under state ownership. Smiley reiterated those concerns on Thursday.

“It’s just coming to financial terms with one another, recognizing the constraints that [McKee] has in terms of his funding streams and our need to not take on a white elephant that will burden city taxpayers disproportionately,” Smiley said.

Smiley said the community’s desire for how to redevelop the property is top of mind.

“The neighborhood went through a really extensive community engagement process, which is what resulted in the Scout plan which was much discussed,” he said.

McKee canceled a state contract with Scout Ltd., the company previously leading an effort to redevelop the historic building. At the time, a state-hired consultant JLL issued a report showing in part a Scout proposed plan would lose the state $10.5 million over the next 15 years.

However, the relationship with Scout also ended after company executives spent months publicly feuding with McKee, triggered in part by a highly controversial business trip that two former state directors took in March to visit Scout executives in Philadelphia.

The trip later sparked a criminal investigation, along with a separate state ethics probe into the directors’ behavior. McKee is also under an ethics investigation for accepting a free lunch paid for by Scout lobbyist Jeff Britt in January.

The governor has said the city is better fit to deal with the building, which he has called “a community project.” Smiley has agreed, although he’s been quick to point out that he’s not prepared to take ownership without financial assistance from the state.

“What we need to do now is marry the community’s desire and the input that they’ve already given with where the funding is available so that we can meet in the middle with a plan that’s financeable,” Smiley said.

The mayor said that could mean a combination of small businesses, artisan craft space, community-based organizations, and possibly housing.

“What I want the neighborhood to know is that we’re going to get this done, that we’re going to respect the feedback that they’re already given,” Smiley said. “We’re not going to ask them to go through yet another planning process, we’re going to drag this thing across the finish line”

Eli Sherman contributed to this report.