Satchell proposes economic incentives for redevelopment in Arctic
STATE HOUSE – Arctic was once West Warwick’s bustling retail district, but today, despite attempts in the past to reinvigorate it, many of its buildings remain empty and derelict, shadows that suggest a prosperity that once was but is now frustratingly out of reach.
Sen. Adam Satchell believes it isn’t just the buildings, but the incentive programs aimed at their redevelopment, that could use some reinvigoration.
He is cosponsoring legislation to expedite permitting and offer tax incentives in designated areas suffering from extreme distress, and is sponsoring a separate bill aimed at tweaking the law that created a Municipal Economic Development zone in Arctic to incentivize the redevelopment of exiting buildings.
The first bill (2015-S 0106) would create “micro-zones” in exceptionally distressed areas and encourage revitalization in those zones through a combination of expedited permitting and tax and fee waivers.
Under the proposal, whose primary sponsor is Sen. Harold M. Metts (D-Dist. 6, Providence), a city or town council would be allowed to designate one or more areas as a micro-zone in which the rehabilitation efforts receive special consideration.
The designation would target substantially vacant buildings and allow those who wish to rehabilitate them to get fee-free, expedited building permits and to get tax credits reimbursing them for the state sales tax they pay on all building materials, furnishings and fixtures for the building. The owner would also be eligible for a 10-year property tax stabilization agreement with the community. In communities West Warwick’s size, individual zones would be limited to 20 acres, but the designation would allow the town to more effectively market Arctic’s downtown as an affordable place to set up a business.
“We have plenty of buildings that could be viable locations if we offer the right incentives. But we need to make sure the programs allow for redevelopment, as opposed to just new construction, because that’s the sort of opportunity we have in Arctic. The buildings are already there, and if we help entrepreneurs make the changes they need to use them, and give them incentives to want to be part of West Warwick, we’ll be laying out the welcome mat for the new businesses and jobs we need in the village,” said Senator Satchell (D-Dist. 9, West Warwick).
He has also proposed a separate piece of legislation altering an existing program that was aimed at invigorating Arctic. That bill (2015-S 0121) would change the requirements of the previously designated “Municipal Economic Development” (MED) zone that encompasses Arctic to allow participation by businesses that rehabilitate existing structures. Currently, most of the benefits in the MED zone program are available only to eligible businesses that construct new buildings. Since Arctic has little available space for new construction, the program has gone largely unused in the decade since the zone was established, Senator Satchell said.
Besides expanding the program to businesses that rehabilitate existing structures, Senator Satchell’s bill would also tweak the law to allow retail businesses and restaurants that open in the zones a competitive advantage: They could waive 50 percent of the state sales tax for their customers for their first 10 years.
Under the existing law, money from the sales tax that those businesses collect is supposed to be redirected from the state to the business’ municipality for further promotion of the development in the MED zone. That provision would be left untouched by the bill, although the sales tax rate would be halved. Since no businesses have used the MED zone designation yet anyway, West Warwick would not be forfeiting any existing revenue through that change.
Senator Satchell said he believes the changes in both bills would be improvements over the incentives currently available to lure new business to Arctic.
“The status quo isn’t doing much for the village. We need incentives that take a more realistic approach and focus on redevelopment over new development,” said Senator Satchell.
For more information, contact:
Meredyth R. Whitty, Publicist
State House Room 20
Providence, RI 02903