Opposition from legislators, local citizens and the governor's office spurs the proposal's downfall.
In a joint statement released late yesterday, Mayor Susan D. Menard and developer Brian Bucci, of Warwick-based Bucci Development, announced their decision to end the agreement, citing "legal, procedural and political obstacles" the project has encountered in the last year and the "substantial delays" they have caused.
"As a result of these obstacles it has become highly unlikely that the
MED Zone Development could proceed in a timely fashion, as originally proposed
and presented to the City of
For nearly a year, the project has encountered opposition from legislators, local citizens and more recently, the governor's office.
Rep. Roger A. Picard, D-Woonsocket, has twice introduced legislation that would eliminate the development's reduced-tax component.
Most recently,
Reached late yesterday, Governor Carcieri's spokesman, Jeff Neal, said that was not his understanding of what had happened on the state level, though he was unable to provide any further information.
"I suspect there were so many roadblocks in his way that [the developer] may have figured it was in his best interest to clear out," City Council member John F. Ward said. "The governor's office was working against [the MED zone], Woonsocket legislators were working against it and I would think as a businessman it would be in his interest to develop something that's more appealing."
In January 2005, Woonsocket signed a master plan agreement with Bucci to build the reduced-tax retail zone, including a series of big-box stores, where shoppers pay just half of the state sales tax, slashing the rate from 7 percent to 3.5 percent for the first 10 years of operation. The resulting tax revenue was to be funneled directly to the community, reserved for economic upgrades in the designated MED zone area.
The proposal was the result of a 2002 law that authorized West Warwick to develop such a zone as a way to lure shoppers and spruce up its Arctic center. The law was later expanded to include two other communities: Woonsocket and Central Falls.
Woonsocket, which had long looked for a way to boost its commercial base, jumped at the idea, aligning itself with Dowling Village, a North Smithfield retail development project in the works on property abutting Woonsocket. The MED zone would serve as an extension of Dowling Village; its tax breaks an incentive for shoppers to visit the entire complex.
City officials made no secret of their fondness for the project, but from the start there were obstacles. A North Smithfield-based citizens' group known as the Valley Alliance for Smart Growth waged war on the development, eventually filing a lawsuit against the Town of North Smithfield to stop it.
By spring, Picard emerged as another voice of opposition, saying the zone's tax breaks would hurt small businesses. He submitted legislation that proposed eliminating the reduced-tax component of the 2002 legislation, forcing shoppers to pay the full 7-percent tax rate, though half of that would still go to the city.
Bucci's lawyer declared that without the tax breaks, the developer would probably pull out of the project. But at a contentious House Finance Committee meeting last summer, committee members unanimously recommended eliminating those tax breaks.
Then, in recent weeks, there was the matter with the governor's office, Mathews said.
It was unclear yesterday whether a revamped MED Zone proposal might resurface in another part of the city, though for now the development's fate is clear.
What made for disappointment in Woonsocket meant something of a victory for North Smithfield, officials there said yesterday.
Town administrator Robert B. Lowe said that community will move forward with the permit process for Dowling Village.
"It can only affect us on a positive note if they are backing off," Lowe said. "There was nothing in the MED zone that would benefit North Smithfield that we could see at this point, so that makes us very happy."
"It pleases me to see the MED Zone gone because I think that's what started a lot of the controversy. That might eliminate some of the traffic woes we might have anticipated there."
But Valley Alliance chair Caroly Shumway said the announcement still raises some concerns.
"We're delighted by Mayor Menard's and Bucci Development's decision to terminate the MED Zone agreement for Dowling Village, but we continue to express concern about proposed MED Zones in Woonsocket and their tax unfairness to small businesses in the surrounding areas," Shumway said.
-- With reports from staff writer Talia Buford