In a bold move, Senate Majority Leader Dominick Ruggerio (D-Providence) plans to submit legislation Thursday proposing tax stabilization standards for the 195 District in Providence.
“The administration and the I-195 commission have repeatedly stated they cannot successfully encourage development without the City of Providence creating tax stabilization standards," Ruggerio said in a statement. "Unfortunately, the establishment of clear and predictable tax rates for the I-195 district have not come to fruition. We cannot afford to wait any longer. The development of I-195 is critical to Rhode Island’s economic recovery and this legislation will encourage investment, job creation and economic growth."
Ruggerio's bill is being cosponsored by Senatorw Maryellen Goodwin (D-Providence), Joshua Miller (D-Cranston), Frank A. Ciccone III (D-Providence) and Paul V. Jabour (D- Providence).
Providence Mayor Jorge Elorza said within recent weeks that the city was close to completing a standardized approach to tax stabilization agreements.
In a statement, Elorza said, "From the day I took office, I have said that we need a standardized, predictable and streamlined tax stabilization agreement process in Providence. I am working with City Council leadership to develop the ordinance that will allow us to facilitate and encourage development and am committed to seeing this plan introduced very soon."
Elorza's spokesman, Evan England, said the city's approach could be heard by the City Council as soon as next week.
Meanwhile, Providence City Council President Luis Aponte was seen waiting for someone outside the Capital Grille at mid-day Wednesday, as Ruggerio arrived at the restaurant.
In terms of economic development, Ruggerio said the time has come to act: “Every developer who has expressed interest in a parcel on I-195 land has indicated they will need to secure a tax stabilization agreement with the city of Providence. Earlier this month the I-195 commission again had to extend their agreement with a developer because the party had not been able to secure a tax stabilization agreement with the City of Providence. This stagnation cannot continue as it has become an obstacle to job creation and development in Providence.”
According to a legislative news release, Ruggerio's bill "creates 20-year tax stabilization agreements for for-profit organizations located within the I-195 Development District. The agreement will allow developers to incrementally pay an increased amount of taxation each year. By the end of the agreement, the organization would be paying 100 percent taxation."
According to Ruggerio, “Tax stabilization agreements are not handouts, but rather incentives that allow developers to overcome burdensome commercial tax rates and development costs associated with development in Providence. This legislation will make Providence more competitive with our neighboring states. The governor’s budget supports incentives to encourage development in Rhode Island, but those incentives alone will not bring investment to Providence without clear and predictable tax standards."
Governor Gina Raimondo's spokeswoman, Marie Aberger, offered this answer when asked whether the governor supports Ruggerio's bill: "Tax stabilization agreements can help make catalytic -- but otherwise financially infeasible -- real estate projects possible. The governor looks forward to working with General Assembly leaders and City officials to spur economic development on the I-195 land and across the state."
This post has been updated.