Proposed ProvPort tax, lease agreement extensions advance despite public protest

THE PROVIDENCE COMMITTEE ON FINANCE gave preliminary approval Monday to a proposed extension on the tax treaty and lease agreements with ProvPort Inc./ COURTESY PROVPORT

PROVIDENCE – Controversial extensions to the tax and lease agreements with the operators of Providence’s industrial port received preliminary approval from a city panel Monday despite overwhelming community objections.

The City Committee on Finance’s 4-1 vote Monday advances the tax treaty and lease agreements with ProvPort Inc. to the full City Council for a future, final decision. As proposed, the nonprofit operating the portside industrial land will pay 9% of its operating revenue to the city in lieu of annual taxes for another 30 years, with a corresponding extension to the lease agreement between ProvPort and the Providence Redevelopment Agency. (ProvPort, a holding company, bought the land for $16.4 million in 1994 but has since leased it to the city-controlled Providence Redevelopment Agency, which in turn issues tax-free bonds to pay the city and then sublease the land back to ProvPort.)

The new agreements aim to help Waterson Terminal Services LLC, the company that operates the port, move ahead with $11 million in capital improvements and expansion to the 135-acre space along the Providence River, according to Nicholas Hemond, an attorney representing Waterson Terminal Services.

Hemond described the proposal as a “good agreement” for the city, noting that the new tax treaty increases the percentage of port profits paid to the city 5% to 9%. The infrastructure improvements and expansion also position the port to support the burgeoning offshore wind industry, which is poised to be its biggest source of economic activity since the Walsh-Kaiser Co. shipyards of World War II, according to Lawrence Mancini, the city’s chief financial officer.

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But these benefits were overshadowed by a litany of concerns about timing, environmental and health impacts and the public process, as voiced by local residents and advocates during 1.5 hours of public testimony. Many implored city officials to hold off on any decisions to give more time for public input and to strengthen the proposed agreements.

The existing tax treaty with ProvPort Inc. runs through December 2024, while the lease agreement doesn’t end until 2036. Several residents accused the city council of “ramming” the agreements through before its members leave office.

“If this is a good deal today, and maybe it is, it will be a good deal in a month, it will be a good deal in April,” said Councilwoman-elect Sue Anderbois. “This is being rushed.”

But Hemond said the port needed the “financial certainty” of the extended lease and tax agreements to issue bonds for the capital projects.

The port served as the staging ground for the first-in-the-nation offshore wind farm off the coast of Block Island, and has since invested its own money as well as that of Danish wind energy giant Orsted A/S into infrastructure improvements aimed at supporting the slew of offshore wind farms being built off New England’s coastline.

“There’s a massive shortage of and demand for port infrastructure to support that industry,” said Chris Waterson, general manager of Waterson Terminal Services.

The bond money will also help ProvPort pay for a master plan outlining its future growth and expansion plans, which in turn will let it tap into the massive amounts of federal infrastructure and renewable energy funding recently made available, Hemond said.

While residents and community advocates welcomed the prospect of a master plan to outline development for the city’s industrial port, they insisted the plan should come before the city agrees to longer deals on taxes and leasing with the port.

“The order in which we’re doing this seems totally backward,” said Liza Burkin, a city resident who also serves as the organizer for the Providence Streets Coalition. “We must have a master plan for the port first before any tax exemption is considered.”

Lack of community input was also a pain point among those who spoke Monday, which many felt has been a pattern in which low-income, minority neighborhoods have been forced to bear the brunt of industrial development without being given a voice. 

“There’s always a corporation, fossil fuel company looking to gain a foothold, expand its footprint or cover its tracks against the will and health of the community,” said Devon Pinkus, a local resident.

Noise, environmental pollution and health consequences, including high rates of asthma, have long diminished the quality of life for residents in the neighboring south Providence neighborhoods. Yet several of the largest offenders – metal scrapyards and recycling companies – are located outside of the 135-acre property under ProvPort’s domain, a distinction that city officials and company representatives sought to make throughout the meeting.

And though Waterson and Hemond said ProvPort’s plan is focused on renewable energy, particularly the offshore wind sector, the proposals themselves did not require that, at least originally. Amendments introduced by Councilman James Taylor that were incorporated by the Finance Committee in its vote ban any expansion of fossil fuel-related companies, while also setting aside $25,000 in annual revenue from ProvPort’s payments to the city for the surrounding Ward 10 neighborhood.

Councilwoman Helen Anthony cast the sole vote in opposition after first suggesting the committee delay a decision.

Nancy Lavin is a PBN staff writer. You may reach her at Lavin@PBN.com.

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