PROVIDENCE – After a split vote Monday sent the reworked financing plan for Pawtucket’s soccer stadium project into sudden death, Gov. Daniel J. McKee stepped in to score the winning kick.
McKee cast the tiebreaking vote in an R.I. Commerce Corp. board meeting Monday, allowing the Tidewater Landing project to move ahead with a reworked public financing deal. As the chairman of the board, McKee does not vote except to break a tie.
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The agreement aims to help developer Fortuitous Partners cover unexpected price hikes in the 10,000-seat soccer stadium anchoring the project. In order to do that, the state will funnel almost all of the already approved $27 million in state bonds to pay for the stadium, reserving just $1.5 million for later phases of public infrastructure in the project.
Another $19 million in city funds – a combination of bonds and property tax revenues – plus private financing from the developer will cover the rest of what is now a $124 million stadium.
The agreement appears nearly identical to what McKee pitched to R.I. Commerce in June, to which board members responded with a flurry of concerns.
A few differences between then and now: the $1.5 million set aside for later parts of the project, which also includes housing, retail and public infrastructure.
Also, existing office space will be swapped out for 80-100 more housing units, on top of the 435 units already in the project plans.
New protections around the state funding ensure that the state won’t be on the hook for cost overruns, while requiring the United Soccer League team to stay on as Pawtucket’s team for 30 years, or else pay the state back to leave early. A PowerPoint presentation from R.I. Commerce shared during the meeting also listed other “remedies for failure of the developer to meet such benchmarks,” although those options were not described in detail.
These tweaks did not initially appear to assuage board members, who reiterated many of the same concerns voiced at the meeting in June.
Chief among them: What happens if there’s not enough money left to ensure the rest of the project – the most important part economically for the state – gets built?
“Then what?” Bernard Buonanno, a board member, asked. “That’s the question we’re struggling with.”
And the alternative, a stadium with nothing else, was hard to stomach.
“Slightly aggressive but achievable” is how CSL Consulting, the Burlington, Mass.-based consultant hired to analyze the project, described the financial return on investment for the stadium.
“If I had $50 million, I wouldn’t put it in a deal that was slightly aggressive but achievable,” said board member Michael McNally. “I think that’s reckless.”
Other key details about the project – an updated final cost, plans to ask for more state funding in the next legislative session, the amount of workforce or affordable housing, or a timeline – were met with the same, equally unsatisfying answer: We don’t know.
How those uncertainties were resolved was not immediately clear but after meeting behind closed doors, members narrowly approved the updated financing plan by 6-5 vote, with McKee casting the tiebreaking vote. McNally, Buonanno, Mary Jo Kaplan, Donna Sams and Vanessa Toledo-Vickers voted against the deal. Two members – Karl Wadensten and William Stone – abstained.
In a brief statement following the decision, Brett Johnson, principal for Fortuitous Partners, called it “an important milestone” and promised a groundbreaking would be happening “soon.”
McKee remained bullish on the project despite nearly half of the board voting against the deal.
“I’m not concerned,” he said. “People have differences of opinion.”
Asked about the possibility that only the stadium will be built – leaving the state on the hook to repay the millions of dollars borrowed – McKee answered, “I’m not thinking about that.”
The original mixed-use development called for 435 housing units along with retail and commercial space, an outdoor event plaza and a riverwalk connecting the two sides of the Seekonk River.
The project is expected to create 474 direct construction jobs and 162 permanent ones, and generate $37 million in state tax revenue over the next 30 years, according to a CSL analysis shared Monday.
In addition to the already approved $36.2 million city and state financing, R.I. Commerce has authorized $10 million in net state tax credits for the project.
(Update: quote clarified in 14th paragraph)
Nancy Lavin is a PBN staff writer. You may reach her at Lavin@PBN.com.
McKee should have checked with his Mom before approving this bum deal.