News & Event
By Sean Flynn | Staff writer
NEWPORT, R.I. — A developer based in the city is offering to purchase the former Cranston-Calvert School off Broadway and convert it into a 34-unit apartment complex that includes two-bedroom and one-bedroom apartments.
BCM Realty Partners LLC has offered the city the “gross sum” of $1 million for the property, City Manager Joseph J. Nicholson Jr. told the City Council Wednesday night.
“The pricing is in line with a fair market value appraisal that I commissioned to determine the range of value, as is,” he said.
A gross sales price was cited because hazardous waste remediation may be necessary at the school, to remove asbestos for example, and the city may provide a certain credit to the developer for that work, he said.
“We could have a lower net sales price,” he said.
* BACKGROUND: Three historic city buildings now on the selling block
Rehabilitation costs are extremely high, Nicholson said in response to concerns the sales price may be low.
The city is converting the former Sheffield School on Broadway into a business incubator center and the rehab costs there are about $185 a square foot, he said.
“This school conversion provides innovative housing space to attract young technology people to Newport to provide a ready technology-savvy workforce,” Nicholson wrote in a memorandum to the council about the Cranston-Calvert project. “While that may sound anecdotal, the idea is that we believe we can generate an economy for Newport that has at its core need housing availability.”
“We are trying to create a new economy in the north end,” Nicholson told the council members during discussion. “Part of being successful with that is to create affordable housing that will bring young people back to Newport.”
“A lot of young people I work with out at the base (Naval Station Newport), would love to live in a place like this,” said Councilwoman Jamie Bova, who is an engineer.
Census data shows that Newport has an aging population and the number of city residents is declining.
“We are facing significant population decline,” Nicholson said.
Rental costs per unit in the apartment building would be between $1,000 and $1,500 monthly.
Those rent prices are below rental costs for Section 8 housing, Councilwoman Kathryn Leonard said, referring to the federal subsidy program.
“We already have low-income housing,” she said.
There will be no subsidies attached to this project, stressed Council Vice Chairwoman Lynn Underwood Ceglie and Nicholson agreed with her.
The exterior facade would be retained, but the interior would be totally reconstructed, Nicholson said.
Amenities in the apartment building would include “in-unit laundry, on-site parking, gym or media center, shared space on roof if desired by neighbors, virtual doorman, dry cleaning pickup/delivery, common area wi-fi, intercom system, high-end fixtures for lighting on exterior ...,” Nicholson wrote in the memorandum.
The Cranston-Calvert School was vacated when the students were moved to the new Pell Elementary School in 2013. The Cranston School was built in 1876 and the Calvert School in 1887. The were connected after the Hurricane of 1938.
Beginning in 2014, Berkshire Hathaway has been marketing the city’s vacant school properties that include the Coggeshall and Triplett schools, also vacated in 2013.
“There were numerous showings of the properties with no offers to purchase forthcoming,” Nicholson said. “The schools are just sitting there and deteriorating.”
The Newport Project Development Company, which was formed by consultants hired by the city to identify economic development projects, brought this school development project to the city for review, he said.
“There is a companion deal for the Coggeshall School,” Nicholson said. However, that proposal needs to be worked on, he said.
Nicholson said he sent letters to abutters around Cranston-Calvert to notify them of the proposed sale.
“I’ve gotten a good response from neighbors around the school,” he said. “I will go to neighborhood meetings.”
Nicholson said he did not want to just bring a finished purchase-and-sales agreement to the council without discussion.
“I do not have a formal purchase and sale agreement as of yet,” Nicholson wrote in the memorandum. “It is in draft form and not ready for your consideration. I hope to present that shortly.”
“It will enhance the neighborhood and add to our tax base,” he said.
Courtesy of Newport Daily News
By Matt Sheley | Staff writer Feb 20, 2018
MIDDLETOWN, R.I. — It’s not a question of if more affordable housing for seniors is coming to Middletown, but when.
That is the message from Town Council President Robert Sylvia, who said it is time for the community to do more to help its elderly population.
“I know that we all feel that way,” Sylvia said. “It’s going to happen and it will come to fruition. We haven’t decided where and when, but it’s a lock.”
At a recent meeting, the council was briefed by Rhode Island Housing CEO Barbara Fields about the different opportunities available to the community, should it opt to pursue such a project.
While no decisions were made, the council targeted the former Berkeley-Peckham School building on Green End Avenue, next door to the town’s senior center, as the most viable option.
When asked about the effort, Sylvia said the senior center would not be part of the project. Rather, he said the red brick classroom space that was formerly a schoolhouse could be converted into affordable apartments. The last time that area was in use was for office and meeting space during the filming of “The Discovery” in 2016.
“The old classrooms are certainly one of the possibilities we’re looking at,” Sylvia said. “There are other possibilities and this is certainly something we’re actively working on so our seniors can enjoy their ‘Golden Years’ instead of worrying about how they’re going to afford them.”
According to Fields’ presentation, it is important for communities like Middletown to step up and do more for retirees.
According to statistics on the agency’s website. Rhode Island has the 19th highest “Housing Wage” in the country. The National Low Income Housing Coalition said that means people need to make $19.49 an hour to pay for a two-bedroom rental home. And those who get paid minimum wage must work 81 hours a week to be able to afford the rent on that same apartment.
The issue isn’t a new one for the town of Middletown.
Going back five years, the council talked about ways to make the community more affordable, particularly for its most vulnerable populations.
Among the sites discussed then for a senior housing project were the old Berkeley-Peckham School, the current school administration property on Oliphant Lane, and a site on Valley Road between East Main and West Main roads.
So far, they’ve proved to be nonstarters, mainly because of the costs and complexity of taking on such deals. The neighboring communities of Newport and Portsmouth each offer affordable housing.
Last week, Councilmen Dennis Turano and Antone Viveiros unveiled a new plan to use the base assessment of a property to tax home and business owners, one they said could prevent people from getting forced from their homes.
Previously, Sylvia has talked about his desire for the town to enter into a public-private venture to get the senior affordable housing project done. On Sunday, he reiterated those thoughts, saying the concept is in the town’s grasp, and it is up to the community to grab it.
“We’ve been moving full steam ahead on this for awhile now,” Sylvia said. “It’s good, now that we’re starting to see the pieces falling into place.”
Courtesy of The Newport Daily News
By Sean Flynn | Staff writer
Nov 24, 2017
NEWPORT — About 150 people from all walks of life with a range of experiences gathered Thursday afternoon at the Seamen’s Church Institute for a Thanksgiving dinner that is an annual celebration of community.
Hugo Wallgren of Newport, a retired chief financial officer, and Zolton Phillips of New Bedford, Massachusetts, a retired real estate developer, sat at one of the long tables in the main room and regaled guests with stories and jokes.
“We met in a nursing home in Plymouth (Massachusetts),” said Wallgren, who is a cancer survivor. “We are the only two who walked out of there at the time and have been friends ever since.”
“We’re both retired and the kids are gone,” he said.
“We can’t even chase women anymore,” Phillips said.
They both came to the dinner for the first time three years ago and vowed to make it an annual event.
“It’s awesome,” Wallgren said. “The food is good and all the people are so nice. It’s the cross-section of humanity here that makes it so different. It’s beautiful.”
“It makes my Thanksgiving,” Phillips said. “That’s for sure.”
When so many banks folded during the bank crisis in 1989-1991, Phillips had millions of dollars in mortgages held by banks that were taken over by the federal government, he said. He was given the choice of paying off all the mortgages, which he wasn’t able to do, or having the government repossess all the properties that had lost value in the recession at the time. The process left him owing huge amounts of money after bankruptcy.
“I accept it for what it is,” Phillips said. “I don’t complain about it. Everyone here is so close. People are family.”
“I used to think this dinner was for the homeless, but now I see it is for everyone,” said Arthur Marshall of Newport, a retired restoration contractor who once did work for the late billionaire Doris Duke. He was at the dinner for the first time.
Spouses split up, children go their own ways, and the Seamen’s Thanksgiving dinner is a way to reconnect with old friends, participants explained with different stories.
Marshall was talking to Tom Stolarz of Jamestown, who has been doing residential masonry work for 35 years and first met Marshall on a construction job in 1983.
“I’m single, have my own business and don’t have any family in the area,” Stolarz said. “It’s really nice to drive over the bridge, come here and socialize with people.”
Marshall said extended families sometimes get together these days in restaurants and have their Thanksgiving dinners there, pay up and then they all leave for their separate homes.
“I miss the way I was brought up, when my mother made a big Thanksgiving dinner and all your cousins, aunts and uncles were there,” Marshall said.
Katy Grovell of Newport is 91 years old and has been a guest at the dinner for many years.
“I come here once a year and really like it,” she said. “It’s a great place to get out and socialize, and just be thankful. I’m a vegetarian, but all the food I receive here is very good.”
Kim Comfort is the head chef who put this feast together with many other volunteers.
She did it with 10 large turkeys, 50 pounds of potatoes, 30 pounds of mushrooms, 15 pounds each of celery, onions and carrots, and 10 pounds of green beans.
“We started slicing and dicing early Tuesday night and then assembled everything on Wednesday,” Comfort said.
One of the volunteers came into the kitchen at 6:30 a.m. on Thanksgiving Day to prepare the turkey stock, but the cooking really started at 8:30 a.m., Comfort said.
She has some deep roots in this tradition. Her family ran the former Music Hall Cafe across from Seamen’s Church Institute, in the building that later became the Rhode Island Quahog Co. restaurant and is now SpeakEasy Bar & Grill.
The Thanksgiving dinner tradition at Seamen’s Church Institute began in conjunction with the Music Hall Cafe, where the dinners were initially held, in 1995, Comfort said.
“My father, Lyn Comfort, started it with Patience Connerton,” she said. “At some point, the dinners came over here to the Seamen’s.”
Rebecca Northrup, the superintendent of Seamen’s Church Institute, said about 50 volunteers helped with some aspect of the dinner event, whether it was food preparation, setting up, cooking or serving the meals.
“We’ve noticed the number of guests going down each year,” she said. “About five years ago, we were seeing up to 300. Now, more community organizations offer Thanksgiving dinners and more Thanksgiving baskets are given out. It’s great.”
“What we offer that is so important is the sense of community at the dinner,” Northrup said. “People all talk to each other and there is a strong sense of belonging and good will.”
All the food is donated and cash donations pay for the use of china, silverware, linens and centerpieces, she said.
Besides the community tables in the main room, there were smaller tables set up in a room on the second floor.
Among the many volunteers on Thursday was Ruth Thumbtzen, a tireless volunteer for many organizations who taught for more than 40 years in Newport Public Schools and at Salve Regina University before retirement.
She was helping out with her two grandchildren who were here with family from Annapolis, Maryland: Eric Johnson, a senior at Virginia Tech, and his sister, Michaela Johnson, a freshman at Boston University.
“It’s a good feeling to make other people’s lives a little more tolerable,” she said. “Everyone here is having such a good time. I get more out of this than I give.”
Courtesy of The Newport Daily News
With temperatures expected to plunge into the teens and single digits in the next few nights, some local organizations are functioning as warming centers for the homeless.
Such centers provide temporary shelter for homeless people to prevent injury, illness or death in the event of extreme weather conditions.
Carmela Geer, executive director of the Edward King House Senior Center, said the house will act as a warming center starting on Tuesday and will continue throughout the winter, Mondays through Fridays from 9 a.m.-4 p.m.
Geer said conditions don’t necessarily have to be dire. “Even if it’s just a regular winter day,” all are welcome to stop in and get warm, she said.
The Newport Public Library, 300 Spring St.; the Florence M. Gray Community Center, 1 Shimoda Way; and Donovan Manor, 19 Chapel St., also will serve as daytime warming centers, according to the Newport Fire Department’s Facebook page.
Seamen’s Church Institute, 18 Market Square, will function as an overnight warming center today through Tuesday from 4 p.m.-7 a.m., offering not only shelter but also hot food and beverages, cots and blankets.
Leslie Streuli, events and marketing coordinator for the Seamen’s Church Institute, said she believes that, besides homeless shelters, the institute is the only organization in the state that opens as an overnight warming center.
Wednesday marked the institute’s first day of accepting overnight guests for this year’s stretch of frigid cold weather; the organization has done this in years past as well, Streuli said.
The decision to open Seamen’s Church Institute as an overnight warming center is done in collaboration with the Newport fire chief and the Housing Authority of Newport, Streuli said.
The maximum intake per night at the institute is 20 people, Streuli said. In past bouts with frigid weather, the organization would typically see an average of 10 people on any given night seeking a warm place to sleep, she said.
But that number varied greatly and the influx of clients is always “brutally unpredictable,” Streuli said. It simply depends on “what kind of state people find themselves in” when the weather turns extremely cold, she said.
Volunteers are needed at Seamen’s Church Institute to assist with handing out warm food and drinks, playing card games with clients and ensuring the building runs smoothly.
There are two shifts for volunteers: 4 p.m.-11 p.m. and 11 p.m. to 7 a.m. Volunteers must be at least 18 years old. Call the Seamen’s Church Institute at 847-4260. Volunteers will receive on-the-job training.
“We rely almost entirely on volunteers,” Streuli said. “It takes a lot of people pitching in.”
A recently released housing report for Rhode Island shows that Newport is second only to Woonsocket in the percentage of residents who are classified as low- or moderate-income.
According to the report by Rhode Island Housing, a privately funded public purpose corporation created by the General Assembly in 1973, in 2016 nearly 15.5 percent of all housing units in Newport were dedicated to low- or moderate-income individuals, slightly lower than Woonsocket’s 15.90 percent. In contrast, Middletown was at 5.4 percent, Jamestown at 4.39 percent and Portsmouth at 2.83 percent.
Newport City Councilwoman Kate Leonard has often spoken out on the issue of housing and the need for affordable units to be spread across the entire state. When asked about the information in the Rhode Island Housing report she said, "I question their numbers, I have been told that Newport has the highest amount of affordable housing in Rhode Island.”
Rhode Island dictates that 10 percent of municipal housing stock be for those in low- or moderate-income brackets. As of 2016, Newport was at 17 percent. The majority of those units are in Newport Heights, Bayside Village, Broadway West,
Festival Field, Rolling Green Village, and Park Holm, where units are being built as replacement housing for those units demolished due to age and to decrease the density of the neighborhood.
The U.S. Department of Housing & Urban Development (HUD) defines low-income households as those whose income does not exceed 80 percent of the median income for the area, with adjustments for smaller or larger families. HUD defines moderate-income households as those whose incomes are between 81 percent and 95 percent of the median income for the area.
A separate report released by HousingWorksRI at Roger Williams University presents a more in-depth survey of area housing statistics and trends. According to the report, 41 percent of Newport residents own their home, while 59 percent rent. In Middletown, the percentage of homeowners versus renters is 53-47. Both communities fall short of the statewide average of 60 percent ownership versus 40 percent renters. Even at 60 percent, Rhode Island has the lowest rate of homeownership in New England, and ranks 46th nationally.
The 2017 Housing Fact Book report, by HousingWorksRI, serves as a clearinghouse of information about housing affordability in Rhode Island, connecting that information with what residents have on economic development, education, and health.
The book offers a number of facts on housing ownership and rental. For example, 58 percent of the housing inventory in Newport is multifamily, compared to 36 percent in Middletown. The state average is 44 percent. Middletown exceeds the state average of 56 percent in the number of single-family homes, at 64 percent, with Newport at 42 percent.
Across the state, HousingWorksRI reports that Central Falls and Providence (excluding the East Side of the city) are the only two municipalities where households with income under $50,000 can find affordable housing; housing is considered affordable when a household spends 30 percent or less of its income on housing costs. In Newport, where the average rent of a two-bedroom apartment or home is $1,508, a household would need an annual income of $60,320 to meet the affordability threshold. In Middletown, where the average rent is $1,407, a household would need an annual income of $56,280.
The median single-family home price in Newport is $446,500, which translates to an annual household income of $113,419 to be affordable, while in Middletown the median price is $352,500, with $95,815 being the threshold of annual household income.
With discussions ongoing about attracting new businesses to land that will be available for development after the Pell Bridge realignment is complete, along with what some see as the difficulty in getting on and off Aquidneck Island, housing will continue to be a major influencing factor for new businesses, but perhaps for education as well. Leonard said, “we have 140 affordable units under construction in Park Holm, and I have concerns what additional impact that will have on our schools.”
– Contributions by B. Udoma
Courtesy of Newport This Week
The Governor’s proposed FY2019 budget (“the budget”) totals $9.2 billion, an increase of $5.2 million over the enacted FY2018 budget. This includes $3.8 billion in general revenue (increased by $25.0 million from enacted FY2018) and $3.1 billion in federal funds (a decrease of $52.3 million from enacted FY2018) with the balance from restricted receipts and other sources. The following provides some budget highlights.
The proposed Medicaid budget for the Executive Office of Health and Human Services (EOHHS) totals $2.3 billion, including $906 million in general revenue and $1.4 billion in federal funds to provide health care and long term services to around 280,000 Rhode Islanders. The federal government’s recent extension of the Children’s Health Insurance Program (CHIP) saves the state $29 million to provide coverage for certain children and pregnant women. The cost to cover the 70,000 adults who became eligible under Medicaid “expansion” is $472 million of which the state pays $31 million (around 6.7 percent of the cost compared to the regular state share of around 49 percent).
The budget includes approximately $150 million in cuts to the Medicaid program, including $68 million in general revenue. This includes cuts to providers: managed care organizations ($70M total, $24M in general revenue); hospitals ($30M total, $11M general revenue); and nursing facilities ($5M total, $3M general revenue). The budget assumes around $11 million in savings ($5.3M in general revenue) from eliminating retroactive coverage for seniors and people with disabilities. Under current law, medical bills incurred in the three months before application can be paid by Medicaid for these populations.
Co-payments: The most significant impact for Medicaid recipients is the proposal to require co-payments for services including the following: $8.00 for non-emergency use of the emergency room; $4.00 for brand name prescription drugs and $2.50 for generics; $3.00 per inpatient hospital stay; $3.00 for non-preventive doctor visits. The co-payments are capped at 5 percent of household income and apply to all adults over the age of 19 except for adults who are enrolled in Medicaid based on disability. This includes adults, parents, seniors, and pregnant women.
Almost all of the Rhode Islanders who will be required to pay toward their medications, doctor’s visits and other co-pays have income that is no higher than 138 percent of the federal poverty level (FPL) and the majority have income that is below the poverty level. Over three-quarters (78 percent) of the adults without children (the expansion population) who receive Medicaid have income below the federal poverty level. Almost three-quarters (74 percent) of parents have income below poverty, including several thousand parents who receive RI Works cash assistance whose income is almost 70 percent below the poverty level.
Generally, seniors who have Medicaid coverage have income near the poverty level and seniors who receive federal SSI cash benefits and Medicaid have income that is 20 percent below poverty. The new co-payments are estimated to “save” the state $3.2 million in general revenue and would generate savings for the federal government of $11.9 million.
Health care and long term care services for seniors and people with disabilities: The budget proposes to redesign health services delivery for around 11,000 seniors and people with disabilities who have both Medicare and Medicaid coverage and are enrolled in Neighborhood Health Plan’s (NHP) Unity Plan. NHP receives a capitated payment from the state to coordinate and pay for these members’ health care services as well as long term services in the community and nursing facilities. The redesign would end the managed care enrollment and capitated payments. NHP would be paid to coordinate member services and care management and the state would pay providers through the fee-for-service system. EOHHS would also implement a Community First Choice Option to increase federal reimbursement for certain long term care services. These changes are anticipated to save $15 million, including $10 million in general revenue. The budget does not appropriate the $6 million (half general revenue and half federal funds) available through the “Perry-Sullivan” funds (funds freed up by reducing nursing home placements) to expand home and community based services. Instead, most of the funds are proposed to be used to pay for the previously enacted wage increase for home care providers.
Non-emergency medical transportation (NEMT): The state contracts with a vendor to provide Medicaid members with transportation services to doctors, pharmacies and other medical services. Consumers have had many problems with the current vendor. The budget proposes to restructure and rebid the contract for NEMT and save $9.2 million, including $3.9 million in general revenue.
HealthSource RI (HSRI)
The budget includes $8.1 million in funds for the state’s health insurance exchange through which almost 30,000 Rhode Islanders purchase health insurance and access tax credits to help them pay the monthly premium. HSRI is also the eligibility portal for children, families and adults who are applying for Medicaid. Funding includes $2.4 million in general revenue and $5.7 million in restricted receipts from a 3.5 percent health insurance premium assessment.
Senior Centers and Meals-On-Wheels
The budget doubles state resources for Senior Centers from $400,000 to $800,000 and maintains funding ($530,000) for Meals-on-Wheels. Adequate nutrition for seniors and opportunities to engage in community
activities are important “social determinants” that can impact seniors’ health and well-being.
Child Care and Early Learning
The budget includes $1.5 million in general revenue to increase rates paid to providers who serve infants and
toddlers enrolled in the Child Care Assistance Program (CCAP) if the program meets quality standards. The
budget adds $1.1 million in additional general revenue to expand pre-K programs and level funds ($1.2M) the Head Start Program.
The budget also includes $200,000 for a pilot program to allow parents who are enrolled in post-secondary education to access CCAP subsidies. Under current law, parents are eligible for CCAP only if they are working or enrolled in a short-term training program at least 20 hours/week.
Education and Workforce for Adults
Funding for the adult education system, administered by the Rhode Island Department of Education, remains the same as current year. The system, which provides adults with foundational workforce skills, including English language instruction, literacy and numeracy is funded by federal sources (Temporary Assistance to Needy Families block grant ($1M) and the Workforce Investment Opportunity Act ($2.3M) ), general revenue of $2.3 million and $3.5 million from the Job Development Fund.
The budget maintains $300,000 in general revenue for the “Pay for Success” transitional employment program for formerly incarcerated individuals and appropriates $400,000 for a new initiative to help people in recovery from opioid addiction access supportive employment services.
The budget codifies the “Real Jobs Rhode Island” program into law within the Governor’s Workforce Board, establishing it as the state’s primary workforce development program. Changes to the law governing the Job
Development Fund would provide long-term funding for Real Jobs Rhode Island.
The budget includes second year funding for the Rhode Island Promise Scholarship, adding $3.6 million in general revenue for total funding of $6.4 million. Tuition and fees are covered for young adults who attend the Community College of Rhode Island (CCRI) within six months of graduating from high school.
There are no new general revenue funds in the budget for affordable rental housing. Approximately $10 million for development and preservation of affordable housing will be awarded in FY2018 from the General Obligation Bond approved by voters in 2016. A similar amount may be available in FY2019. The budget also transfers $11 million from Rhode Island Housing to the General Fund – $6 million to close the FY2018 budget deficit, and $5 million to balance the FY2019 budget request.
The budget increases the cigarette tax by an additional $.25/pack, to $4.50/pack (after increasing from $3.75/pack to $4.25/pack in last year’s budget), and expands taxes on other tobacco products, changes anticipated to generate an additional $6.2 million in revenues.
While the budget doesn’t include any “broad based” tax increases, the expansion of the sales and use tax to cover two services – Software as a Service (SaaS) and security services – is expected to generate $14.5 million. This move is an important step towards better aligning Rhode Island’s sales tax system with our economy, which has substantially shifted from the purchase of goods to the use of services, and from bricks and mortar establishments to on-line purchases.
The budget anticipates that restructuring the Department of Revenue’s Division of Taxation (and adding 22 staff) will enable the state to increase revenues collected by $13.5 million, netting $10 million after staffing and technical support costs.
The budget anticipates substantial new lottery revenue ($27.6M), most of which ($23.5M) is contingent on a favorable decision by the US Supreme Court on the legalization of sports betting. A decision is expected by
The budget increases several fees including insurance claims adjusters’ fees, mutual fund retailers’ fees, and duplicate license fees, totaling $10.6 million, a gain that is partially offset by reducing several licensing fees by a total of $300,000.
Expansion of Rhode Island’s medical marijuana program is expected to generate an additional $5.1 million in revenue.
The budget allocates $18.7 million for FY2019 in additional state aid towards the phase-out of the motor vehicle tax with total of $44.7 million in foregone revenue as a result of the phase out.
Rhode Island continues to rely heavily on economic development tax incentives to encourage employers to make investments in Rhode Island. The budget includes $37.3 million for the Executive Office of Commerce “to support new and existing initiatives…to spur economic development.”
Economic Development Tax Incentives
Refundable Manufacturing Investment Tax Credit
The budget proposes expanding the manufacturing investment tax credit with a $300,000 refundable tax credit to encourage investment in equipment, training, and business capital.
Rebuild Rhode Island Tax Credit
The budget adds $15 million ($3M more than FY2018) to the Rebuild Rhode Island Tax Credit Fund (providing gap financing for the development, construction, or rehabilitation of eligible commercial, industrial, residential, and mixed use properties). The budget also recommends expanding program eligibility and repealing the program’s December 31, 2018 sunset provision.
Historic Tax Credit Trust Fund
The budget includes $12.9 million (on top of revised request for $31.1M in FY2018) for debt servicing costs.
New Economic Development Initiatives
The Governor proposes creation of a new program, SupplyRI, allocating $475,000 to connect small suppliers with some of the state’s largest purchasers of supplies (i.e. universities, hospitals and other large employers) to shift spending from out-of-state to in-state suppliers.
Manufacturing Site Readiness Program
The manufacturing site readiness program would allocate $200,000 for the development of an inventory of “pad ready” industrial sites for potential use by large manufacturers or distribution centers.
Municipal Technical Assistance Grants
This initiative would allocate $200,000 to provide technical assistance to municipalities to expedite the processes involved in municipal zoning, planning, and permitting for local economic initiatives.
Courtesy of Economic Progress Institute
By JOSH BICKFORD | firstname.lastname@example.org
Steve Primiano is worried about the schools.
More specifically, the Barrington Town Council member is concerned about how Barrington’s public schools will be impacted by the new Palmer Pointe affordable housing project if the town decides to extend the development a significant tax break.
More than 10 years ago, a prior town council offered a tax abatement to the East Bay Community Development Corporation when it built the Sweetbriar affordable housing project in West Barrington. That development featured 51 rental units and brought dozens of new students to Barrington’s public schools.
Now, EBCDC is on the verge of beginning construction on the Palmer Pointe affordable housing project on Sowams Road. School officials have estimated that the development will bring more than 30 additional students to Barrington schools.
Mr. Primiano said the additional student enrollment is a good reason EBCDC should be required to pay the full property taxes. The council member said he wants to put the tax abatement issue on a future council meeting agenda.
“I would vote against giving it (the tax break) to them. I support the schools,” said Mr. Primiano. “What about the schools? That’s school money we’re talking about. It’s all about schools. That’s what drives our economy.”
The tax deal for Sweetbriar required that EBCC officials pay 8 percent of the annual rents collected at the housing development instead of the full property tax bill.
Sweetbriar has 51 rental units and the monthly rents range from $603 to $943.
In 2016, EBCDC officials collected a gross rental income of $457,428 at Sweetbriar, and their tax bill to the town of Barrington – 8 percent of the grow rental income – totaled $36,594.
In 2017, the rental income for Sweetbriar went up to $463,572. And when the tax bills go out in August, the affordable housing developer will need to pay 8 percent of the income, which equals $37,086.
So how does that compare to other property owner’s tax bills?
Barrington’s current tax rate is $20 per $1,000 of assessed value. The approximate assessed value of the Sweetbriar development is $5.2 million, meaning that without the tax deal, EBCDC would have a tax bill totaling about $104,000 this year.
Barrington resident Gary Morse believes the town is breaking the law when it forces all other property owners to pay the additional $60,000-plus in taxes that are created by EBCDC’s tax abatement.
“It’s clearly illegal,” said Mr. Morse. “Providence is not giving these tax breaks. Cases have established these are illegal for new construction… They all want affordable housing tax breaks – every Democrat on the council is dead-set on granting these developers these tax breaks. What they don’t realize is these are for-profit enterprises.
Mr. Morse is referring to the Sweetbriar Limited Partnership, which operates under the EBCDC umbrella. Mr. Morse said that shortly after a previous council extended the tax abatement to EBCDC, officials from the non-profit moved ownership rights of the affordable housing development to Sweetbriar LP, which is listed as a for-profit entity. (Council members including Michael Carroll and Steve Boyajian said that the move was a necessity for EBCDC to receive federal tax credits.)
Mr. Morse said tax documents from EBCDC show that Sweetbriar LP declared a $174,306 profit in 2016, and a $171,353 profit in 2015.
Why, Mr. Morse questions, should the town be extending a tax deal to a company that is clearing a profit, year after year?
“You have to look at Palmer Pointe the same way you look at Sweetbriar,” said Mr. Morse. “I think the same thing is going to happen with Palmer Pointe. In the case of Palmer Pointe, taxpayers would be subsidizing a waterfront development. We’re effectively enriching the EBCDC group.”
A tax document from 2011 showed that the former executive director for EBCDC was paid more than $100,000 annually. She also received a pension.
Mr. Morse said Sweetbriar LP or a similar limited partnership for Palmer Pointe stands to cash in on the project – Palmer Pointe, like Sweetbriar, will carry a 30-year deed restriction, meaning that the properties must remain “affordable” for that period of time. But before the deed-restrictions ever run out, the owners can sell the properties to real estate investment firms or other companies.
“They (investment companies) know they can hold on to these properties for a long term and then turn them into market rate units,” Mr. Morse said. “These properties become valuable to anyone before the deed restrictions even come off… There is no restriction to turn around and flip them at any time and they can make a profit. This is the scam that is affordable housing.”
Mr. Carroll and Mr. Boyajian do not believe that EBCDC officials have any plans to sell Sweetbriar or Palmer Pointe to investment firms.
Legislation is flawed
Barrington Town Council President Michael Carroll said the town would be following the law if it offers EBCDC a tax deal for the Palmer Pointe development.
He said the town is obligated to offer the tax abatement and he points to a pair of state statutes as the reasons. (Mr. Morse argues that the statutes only require towns to give the tax break to rehabilitated properties and not new constructions such as Sweetbriar and Palmer Pointe.)
The council president said the bigger issue may be the affordable housing legislation, which states that each community’s housing stock include at least 10 percent that is “affordable.” A more recent estimate puts Barrington at about 4 percent, said officials.
“I believe that we want to preserve some housing in Barrington as affordable and I believe that the current act is the wrong way to do it,” Mr. Carroll said.
Mr. Carroll said Barrington offers a unique set of challenges in reaching the 10 percent goal. He said much of the town is built-out and despite a concerted effort to improve the stock of affordable housing, officials would need to build a skyscraper to close the gap. The town’s comprehensive plan would not allow that type of construction in Barrington.
Members of the council recently met with local legislators Jason Knight, Joy Hearn and Cindy Coyne to discuss the affordable housing situation.
“Barrington is not the only one struggling with this act. There are other suburban communities who would like to see some relief,” said Mr. Carroll. “One way is to give extra credit for rental properties – that would give us a boost.”
Mr. Carroll said the state could also give towns that show progress toward reaching the 10 percent mark a slight advantage when they appear before the State Housing Appeals Board.
Mr. Primiano agreed that the affordable housing legislation is a bad fit for communities such as Barrington.
How they would vote
Right now, it is not clear if or when the 8 percent tax deal will appear on a council agenda.
Council member Steve Boyajian said he believes the developer will make the request at some point in the near future, and when they do, he plan to ask for guidance from the town’s solicitor.
“I’m going to ask the town’s lawyers what to do,” he said. “And we’ll go from there.”
Mr. Primiano has already made up his mind.
“I want to make my case that we don’t have to give it to them,” Mr. Primiano said.
Mr. Primiano added that the town has already set a precedent in voting on the potential tax break when the prior council did so more than 10 years ago.
More than a year ago, Mr. Morse filed a lawsuit again the Town of Barrington over the tax abatement issue. A Superior Court judge said Mr. Morse id not have sanding to bring the suit against the town, but the Westwood Lane resident has appealed to the Rhode Island Supreme Court.
Courtesy of Barrington Times
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