Providence City Council gives first approval to revised TSA proposal

Updated at 7:12 p.m. on May 6, 2021.

The PROVIDENCE CITY COUNCIL gave initial approval on legislation that creates wage standards for large development projects that receive property tax breaks. The Hotel Hive Providence project, pictured here, is one of the projects that has received a tax break from the city. / COURTESY ABDO DEVELOPMENT

PROVIDENCE – Compromise legislation imposing wage standards for larger development projects that receive city tax breaks while exempting smaller-dollar projects received the initial green light from the Providence City Council Thursday evening.

The 14-2 vote is the first of two needed to enact the revised Tax Stabilization Investment Act, which seeks to strike a balance between incentivizing development and protecting workers’ rights. The original legislation, introduced by former Council President Sabina A. Matos, would have required all projects receiving city property tax breaks to pay prevailing wages to contractors who build the projects and set wage standards for permanent, post-construction jobs. The revised version voted on Thursday exempts projects under $10 million from these requirements.

Councilwomen Nirva LaFortune and Helen Anthony voted against the proposal.

Michael Sabitoni, president of the Rhode Island Building and Construction Trades Council, which helped draft the proposed policy, said the revision was a concession but “does not compromise the overall intent of the TSA legislation.”

- Advertisement -

Other key provisions of the bill such as stricter reporting requirements and inclusion of minority and women-owned business contractors are still included. The legislation also increases the council’s oversight of these agreements, requiring its review and approval of all deals except for the first five projects over $50 million in the I-195 Redevelopment and Capital Center districts.

Council President John J. Igliozzi expressed support for the expanded council role during an April 28 Finance Committee meeting.

“This is a tool for the council to get the other side of government to move quicker and faster when a tax stabilization is submitted,” Igliozzi said. “We are the final arbiters of the process.”

Developers in a prior public hearing and in interviews with PBN have expressed concern with the changes, which they say will politicize the process and create additional barriers that ultimately deter them from proposing projects in the city.

While development and labor groups have made their opinions known, often in opposition to each other, the minority business community has been largely silent.

Councilwoman Nirva LaFortune on Thursday reiterated prior concerns about the need for feedback from groups such as the Rhode Island Black Business Association and the Rhode Island Black Contractors Association on how wage and labor requirements might impact them. She also named revisions to city policies for using local and minority and women-owned businesses as changes needed alongside the TSA update.

“As much as I want to see our laborers receive a fair wage, I also want to ensure we create opportunities for our contractors of colors,” LaFortune said.

Leaders of both groups told PBN in separate interviews on Wednesday that they had not followed the legislation closely enough to comment.

Sabitoni disputed LaFortune’s concerns, saying they were “dead wrong” and that wage standards and reporting requirements would level the playing field for minority businesses and contractors.

While Anthony wanted more time to weigh and discuss the legislation, Sabitoni spoke to the urgency of its passage- efforts to reform the city’s TSA policies date back several years and without action, new tax deals continue to bypass these reforms.

Since the bill returns to the council for a second and final passage, further amendments could be made, as several council members noted in discussion Thursday.

Updates throughout to include details of the vote by the Providence City Council.

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

No posts to display