City a step nearer to development agreement

Without dissent, the City Council gives first passage to a master developer agreement.

Tuesday, December 21, 2004

BY CYNTHIA NEEDHAM
Journal Staff Writer

WOONSOCKET -- After weeks of discussion, the city has taken a "major step" toward establishing the first Municipal Economic Development Zone statewide.

A unanimous first passage vote by the City Council authorizes city officials to enter into a master developer agreement with Warwick-based Bucci Development. As the designated developer for the initial 18.6-acre parcel, the company may now begin soliciting tenants. The master agreement also freezes tax rates and offers tenants a seven-year phase-in tax-stabilization program as an incentive to come to Woonsocket.

Projected to generate nearly $30 million in tax revenue over a decade, the development is actually an extension of the proposed Dowling Village complex, a mixed-use development that would be built on adjacent land off Route 146A in North Smithfield.

Early plans for the Woonsocket side of the complex call for a series of "big box" retail stores in what is known as a designated MED Zone -- a reduced-tax commercial zone, where shoppers will pay just half of the state sales tax, slashing the rate from 7 percent to 3.5 percent for the first 10 years. And instead of that tax revenue going to the state, it will be funneled directly to the city, to be used for economic upgrades and possibly a middle school on an extended MED-zone site.

City Planning and Development Director Joel D. Mathews called the master plan agreement "a significant step in the process."

"Is it a done deal? Far from it, but it's a major step," he said.

Council members, however, stressed that last night's vote marked the first stage in a lengthy process that will offer several opportunities for public input. They even passed a last-minute amendment that prevents Mayor Susan D. Menard from making all but minor changes to the plan without their approval.

Anne Poirier, whose family owns Bouchman Hardware in North Smithfield, said she worries that Home Depot will be among the "big box" tenants. "Obviously it puts us at a disadvantage charging 7 percent sales tax instead of 3.5. And it's not just us, you're talking about all the small businesses that have been there for 50 or more years," she said.

The council said it shares those concerns and plans to take steps to help those owners once it knows which tenants will be coming.

The project is in limbo while the city waits for North Smithfield to lend final approval to its side of the development. When, and if, that happens, the developer will have six months to secure a list of tenants. Meanwhile, Woonsocket must formally designate the area a MED Zone, file for zoning and design changes and wait for the state to approve a change to its Comprehensive Plan -- a complicated set of processes that could take well over a year.

Council member Brian R. Blais said the MED Zone classification amounts to free money from the state, money the city would be crazy not to take.

Woonsocket must contribute a token $3.6 million over four years, to be taken from Highland Park development profits and later from MED-Zone revenues. Down the road, those revenues could help pay for a new middle school -- a project that will then be nearly 70-percent refundable from the state.

"This is too good a deal to miss. This is the state giving us money on a silver platter," he said.

The council will act next month on final passage of the ordinance authorizing the city to enter into the master developer agreement.