Commerce RI awards $7M for jobs, redevelopment across the state

COMMERCE RI HAS AWARDED nearly $7 million in tax incentives and grants to three projects, including the redevelopment of the Pontiac Mills in Warwick.  / PBN FILE PHOTO/RUPERT WHITELEY
COMMERCE RI HAS AWARDED nearly $7 million in tax incentives and grants to three projects, including the redevelopment of the Pontiac Mills in Warwick. / PBN FILE PHOTO/RUPERT WHITELEY

PROVIDENCE — The R.I. Commerce Corp. voted to approve more than $7 million in state relocation and redevelopment credits Monday to several corporations that plan to invest in or bring jobs to Rhode Island.
“These are three fine projects that are helping to advance our economy,” said R.I. Commerce Secretary Stefan Pryor.
The relocation incentives approved by the board would extend $362,055 over five years to a Connecticut company, Ivory Ella LLC, which has plans to relocate to a 38,000-square-foot facility in Westerly and expand its staff. According to a summary by Commerce RI staff, the state of Connecticut tried to assist in relocating the company to another city in Connecticut through $100,000 in incentives.
The company, which has been in existence little more than a year, designs, produces and ships garments and accessories that promote the saving of endangered elephants. The online-only retailer employs 19 people full-time at two locations in Connecticut, and has pledged to add at least 11 more employees at a median salary of $50,000 in Rhode Island within three years.
The project would add up to 60 jobs over five years, according to company principals, who attended the meeting. The program that will support the company’s efforts is known as the Qualified Jobs Incentive Tax Credit Program.
The company’s products line, which began with screen-printed, elephant-themed T-shirts, has expanded in recent months to include a variety of accessories. It contributes 10 percent of net profits to nonprofit organizations, including Save the Elephants.
The state funds would be paid over five years and would be contingent on the company maintaining at least 30 new jobs in Rhode Island for six years.
In other actions, the Commerce RI board gave the largest incentive award to a joint venture of the Union Box Co., based in Baltimore, CAM Construction LLC and Happy Mills LLC, which jointly propose a $34.6 million redevelopment of the sprawling Pontiac Mills in Warwick.
The project, which has already qualified for $9.3 million in federal and state historic preservation tax credits, will now receive up to $3,626,403 through the state’s Rebuild Rhode Island incentive program, designed in part to help developers bridge the financial feasibility gap in renovating defunct properties.
The historic mill, which dates to the pre-Civil War era, is best known for producing garments for the union war effort in the 19th Century conflict. It has been vacant for several years.
The project, as proposed, would renovate the mill complex along the Pawtuxet River into a 200,000-square-foot mixed-use development. The mix would include 127 rental apartments of varying sizes and 34,000 square feet of retail space, including a brew pup, according to Luke Pickett, managing director of investments for Commerce RI.
The Rebuild Rhode Island tax credits would be paid out over five years, beginning on occupancy of the complex. The project has already begun with site preparation work and is expected to reach substantial completion in September 2017, according to Pickett.
In a separate vote, the Commerce RI board authorized up to $3 million in tax increment financing for the construction of an extended-stay hotel, branded as a Hilton Hotels property, on vacant land on Exchange Street in downtown Providence.
The financing would be provided by the waiving of 6.2 percent of the state’s 13 percent hotel room occupancy tax on the hotel property. It is the first time this program has been put to use. The total of the financing cannot exceed 30 percent of total project costs.
This project, sought by a partnership of the First Bristol Corp. of Fall River and Joseph R. Paolino Jr., managing partner of Paolino Properties of Providence, would result in a 120-room extended-stay hotel with ground-floor retail. The site is now vacant, and was created through the filling in of the Woonasquatucket River in that location. The environmental conditions have complicated the $24.5 million development project, according to James J. Karam, president of First Bristol, who attended the meeting. Old piers and abutments remain in the site, along with contaminants, and will be removed under a plan through the state Department of Environmental Management.
The company has developed two other hotel properties in Rhode Island, including the Hampton Inn & Suites in downtown Providence. Like those, this project needs state assistance in bridging the financial gap created by market conditions. In Boston, he said, the company has properties built at similar cost that fetch $300-a-night for rooms. In Providence, similar rooms would be booked at $170 a night.
“But for this supplement, this project would not happen,” Karam said.

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2 COMMENTS

  1. Instead of providing funds to a few lucky companies with grants in aid, low interest loans or tax breaks Rhode Island should use these funds to increase its funding for education to a point where local communities could reduce their property taxes by 15%. Next, Rhode Island’s sales tax rate should be reduced to 3% on all taxable items and services and food, clothing and boats should be included in the list of taxable items. Finally, Rhode Island should reduce its tax on gasoline and diesel fuel to 20 cents per gallon.
    When this tax plan is implemented, total sales tax revenue would increase because the sale of vehicles, jewelry and other big ticket items would increase. Upper income Rhode Island residents and tourists spend huge amounts on food and clothing. Next, every Rhode Island business owner and homeowner would save 16 cents on every gallon of fuel they buy, 4% on every item or service they buy and 15% on their property taxes. Businesses would expand and hire more employees and home owners would have the money to make improvements to their homes or to buy a more valuable home. Finally, every vehicle going to Northeastern New England or Cape Cod has to pass through Rhode Island. Thousands of these vehicles would stop to buy fuel in Rhode Island each day and each vehicle driver would spend a lot of time and money in Rhode Island. Yearly fuel tax revenue would probably double and this new tax plan would provide the funds to fully fund education, to eliminate the car tax and to repair Rhode Island’s road infrastructure.

  2. Instead of providing funds to a few lucky companies with grants in aid, low interest loans or tax breaks Rhode Island should use these funds to increase its funding for education to a point where local communities could reduce their property taxes by 15%. Next, Rhode Island’s sales tax rate should be reduced to 3% on all taxable items and services and food, clothing and boats should be included in the list of taxable items. Finally, Rhode Island should reduce its tax on gasoline and diesel fuel to 20 cents per gallon.
    When this tax plan is implemented, total sales tax revenue would increase because the sale of vehicles, jewelry and other big ticket items would increase. Upper income Rhode Island residents and tourists spend huge amounts on food and clothing. Next, every Rhode Island business owner and homeowner would save 16 cents on every gallon of fuel they buy, 4% on every item or service they buy and 15% on their property taxes. Businesses would expand and hire more employees and home owners would have the money to make improvements to their homes or to buy a more valuable home. Finally, every vehicle going to Northeastern New England or Cape Cod has to pass through Rhode Island. Thousands of these vehicles would stop to buy fuel in Rhode Island each day and each vehicle driver would spend a lot of time and money in Rhode Island. Yearly fuel tax revenue would probably double and this new tax plan would provide the funds to fully fund education, to eliminate the car tax and to repair Rhode Island’s road infrastructure.