Sen. Adam J. Satchell, D-West Warwick, has introduced legislation for several years that would create micro-zones in “exceptionally distressed areas” that would waive state sales tax and other state fees on revitalization efforts. The mini zones would be limited to 20 acres in size. He spoke to the Providence Business News this week on his efforts to get the bill approved.
PBN: What is the status of the bill, which is 2018-S2068?
SATCHELL: The House had a committee hearing last week. The House has heard this bill in some way, shape or form. I’ve put it in five out of the six years I’ve been in office. There was one year I didn’t put it in, and that was the year the [R.I.] Commerce Corp. was coming out with their incentives. We wanted to see what we could get. Obviously, none of that has really benefited West Warwick.
PBN: Why are micro-zones needed for these distressed areas? Aren’t there incentives that would target these locations?
SATCHELL: Yes and no. With West Warwick, we have a municipal economic-development zone, a MED zone. These MED zones are throughout the state, but no business has accessed these economic benefits since they’ve been in effect. It’s been 15 years now.
[West Warwick] is a distressed community. There is a blighted downtown section that used to be a commercial center, and that’s where the economic-development zone is. The problem is that’s not the only blighted part of West Warwick.
You can say that for Woonsocket. You can say that for Pawtucket. You can say that for Providence. And in a lot of these zones, it only applies to new construction. And these communities don’t have the green space available for new construction. My goal with this micro-zone legislation was to allow towns to establish these little zones, where they could entice business.
PBN: Is none of this already taking place?
SATCHELL: Are there benefits available? Are there incentives available? Sure, but historically that’s been done through tax stabilization agreements, and the towns and cities, they’re the ones eating that money. We’re forcing towns and cities with no money to do this stuff.
PBN: What would the bill do – instead of taking out city taxes, this would be state taxes?
SATCHELL: Sales taxes. It’s a sales tax incentive on certain things for renovating a qualifying structure. No fees for permits, an expedited permit process.
PBN: Why isn’t it moving anywhere?
SATCHELL: There is a perception that we, as a state, can’t afford to lose that tax revenue. In the past, it’s been balked at because “we’re going to lose that revenue. We can’t lose that revenue.” My argument has always been, “There’s no revenue coming from these places. How can you lose money from zero?”
Mary MacDonald is a staff writer for the PBN. Contact her at macdonald@pbn.com.
