Newport has enacted a six-month moratorium on development in its North End, including an innovation district intended to attract companies that might diversify its economy.
It effectively puts a hold on some significant projects – including a $100 million redevelopment of the former Newport Grand Casino – so the city can get new zoning laws in place. But business advocates worry it may cast a wider chill on investors and business owners thinking about moving to the coastal city.
The Greater Newport Chamber of Commerce, which opposed the moratorium, has noted that the area affects the only federal opportunity zone that the city has. And while it only affects developments that would trigger plan review, those thresholds include commercial projects of just 10,000 square feet or more.
Erin Donovan-Boyle, the Chamber’s executive director, said the action affects an entire district that has been trying to attract investment and development for decades. “When people are looking at where to invest … this opportunity zone has a six-month moratorium. So why would they be choosing that?” she said.
Although it affects a land area that could attract large-scale redevelopment projects, the move also startled many smaller-business owners, who are still trying to determine if their renovation and expansion projects can proceed.
In a letter to members, Donovan-Boyle said the district includes 178 businesses. It’s difficult to know, she wrote, how many of those businesses will not pursue expansions as a result.
An attorney for the city told council members that businesses with vested rights would include those that have completed applications already before the city. But for those affected, he said, a moratorium on development would include any new building permits.
T.R. McGrath, an owner of McGrath Clambakes Inc., is an owner in a commercial condo building. There is some question as to whether the building owners can even replace the roof, he said in a recent interview, although that’s not an immediate project.
‘It’s an extremely unfortunate step obviously.’
GREGG PERRY, Carpionato Group spokesman
The moratorium – approved Sept. 25 – was favored by four of six City Council members who voted. They and supportive residents say the city needs the time to get new zoning requirements in place in the North End, to accommodate future growth and to match a comprehensive plan that was revised in 2017.
Justin S. McLaughlin, an at-large city councilman who introduced the moratorium, said his proposal is not anti-development and will result in a plan for the area that everyone can rely on.
“The zoning code should be comprehensive,” he said at the council’s Sept. 11 discussion on the matter. “It should be coherent. It should be consistent and so should planning and development.”
Opponents, including council members Jeanne Marie Napolitano and Lynn Underwood Ceglie, say the move is overly broad and sends a poor message.
Although triggered by concern over large projects, the moratorium potentially will affect any business with plans to expand in the North End, Underwood Ceglie said.
“So, they’re collateral damage to this issue,” she said.
Of the projects most likely to be impacted, the largest is by Carpionato Group LLC. The Johnston-based development company has purchased the former Newport Grand Casino property and in July 2018 introduced a plan to demolish that building and create a massive new development, which it has called Newport North End.
Carpionato has proposed two hotels, two apartment buildings and 164,500 square feet of retail space for innovative research, medical offices and restaurants.
Although Newport’s new comprehensive plan authorizes mixed-use projects in that area, the city’s current zoning requirements don’t. This prompted the developer to introduce its own zoning code, to accommodate mixed use on the 20-plus acre site. All of this is now on hold through the moratorium.
“It’s an extremely unfortunate step obviously,” said Gregg Perry, a Carpionato spokesman, in an interview. “It hurts the project, the Innovation District and clearly the neighbors. At a minimum, it puts a six-month delay in the construction of this project.”
Supporters say the six-month pause is necessary.
Alliance for a Livable Newport, a longstanding community nonprofit, was among those that campaigned for a stop on development until the zoning ordinances can be updated. Taking that step isn’t anti-business, said John Hirschboeck, co-president.
“We’re talking about six months,” he said. “This is not an eternity.” The moratorium will give the city time to work on a community vision for development in the North End, he said.
Many also are concerned about development across Newport, he said.
“We have two major hotels going up downtown, along with another major proposal on Waite’s Wharf. So that’s three major hotels,” Hirschboeck said.
The moratorium supporters were not targeting the Carpionato plans, he said, and were more concerned that the process to guide development – effective zoning – still isn’t in place for that area.
“We were concerned with the entire North End and how it would be developed,” Hirschboeck said.
Mary MacDonald is a PBN staff writer. Contact her at Macdonald@PBN.com.
Truth be told, the six month building moratorium was totally preventable. Sadly, since 2015, council members — including Ms Naplitano and Ms Ceglie chose an insider as city manager who never wanted to be city manager, allowed a zoning function to operate on autopilot, watched a city planning function go limp, and stood by silently as city staff wrecked a potentially valuable strategic private-public-partnership. Educated and outraged residents deserve this brief opportunity for Newport to implement long-overdue anti-sprawl zoning improvements that should boost your future net present value calculations.