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New Proposal: Ten of Millions of Taxpayer Funds for Superman Bldg

Wednesday, April 09, 2014

 

The latest proposal to rehab the vacant Superman Building in Downtown Providence calls for tens of millions in Federal Tax Credits and $39 million in State dollars to subsidize the project.

This is just the latest request by the millionaire Massachusetts Developer who purchased the building when Bank of America leased the building.

Here is the proposal rolled out to the media at nearly 12 midnight on Tuesday night:

Developer's Proposal

· The state to pay $39 million - allocated four equal yearly payments of $9.75 million for the renovation effort beginning in 2015.

· The building’s owner, High Rock Development, would not receive any money until the building renovation is completed with a certificate of occupancy issued.

· The Department of Administration would establish a procedure where up to $9 million of the original state support would be returned to a fund to support future projects. The return criteria will be based on capital events including refinancing or the sale of the building.

· The Developer claims the it will purchase a private completion bond in an amount sufficient to guarantee completion of the project - thus ensuring all economic and employment benefits to the State of Rhode Island are realized in the event that the owner is unable to complete the project.

· The owner of 111 Westminster will contribute to a Kennedy Plaza Revitalization Fund in recognition of the relation between the Kennedy Plaza and the Superman Building. The owner shall contribute $50,000.00 annually into the fund for a period of ten years ($500,000 total) to help fund organizations such as the Downtown Providence Parks Conservancy for the maintenance, enhancement and programming of Kennedy Plaza.

This proposal is the most recent since High Rock pushed for $75 million last year. This year's proposal may be the same as the outline of the project neither discloses the total project cost or how much the developer will pursue in Federal Tax Credits. 

 

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Comments:

The more "creative" this developer gets, the more it looks like he's trying to put ten pounds of dog sh*t into a five pound bag. Bigger question is, will democrats cave to this spin.

Comment #1 by David Beagle on 2014 04 09

Highrock made a mistake. Let them return the keys to the bank and lets work with the next owner. I'm all for smart public private partnerships that are a win win. The cost is too high. Privatized profits and socialized losses is BS.

Comment #2 by Redd Ratt on 2014 04 09

The problem is the state has repeatedly tried to pick projects to support with special deals, this includes CVS in Woonsocket, Fidelity getting all kinds of breaks including road widening in Smithfield, Providence Place Mall getting sales tax rebates and more, Gtech, 38 Studios et al and plenty of deals at the Providence Economic Partnership, plus all the deals competing states make to attract business which in the long run is a zero-sum game where the only winners are the corporations that avoid taxes.
It might be better of our whole country would eliminate all the special deals insiders can make, and reduce the rates for all, and let market conditions determine winners and losers. But that said, since the game, as it is, is on, I think we have a societal interest in helping reuse this building and as long as other businesses get breaks, I don't see why this should be different.

Comment #3 by barry schiller on 2014 04 09

Barry, some good points. The problem with this particular deal is the owners bought at inflated values and need too much public assistance to make it work. Lets wait until they sell the building take their beatings and offer a much lower level of support to the next owner.

Comment #4 by Redd Ratt on 2014 04 09

Highrock wants $39,000,000 from Rhode Island taxpayers. The article also says their counting on tens of millions in federal tax credits. It probably adds up to at least $75,000,000 in the end. They want the taxpayers to put more in than them and give us no equity. The GA can't be considering this deal. Oh were screwed.

Privatized profits and socialized losses. Progressives and fiscal conservatives should be able to find common ground here.

Comment #5 by Redd Ratt on 2014 04 09

Just say no to your tax money going into some developers pockets.

Have we learned nothing?

DeepWater - over $500 million in extra costs to ratepayers over 20 years, The state actually had to write a new law so the PUC was forced to accept it after rejecting it earlier. Where are the 800 jobs? This thing was approved years ago. As an added attraction ratepayers will be paying for a $100 million dollar power cable from Block Island to the mainland.

38 Studios, a deal made behind closed doors we'll be paying for that one for decades.

Comment #6 by Jim D on 2014 04 10

Superman himself would consider this deal full of Kryptonite.

Comment #7 by Roy D on 2014 04 10

What could possibly go wrong with this?
As if 38 Studios didn't put RI far enough in the hole.
If Mr.Sweetser wants to be a venture capitalist let him risk his own money-that would be a novel idea.
I understand Bill Fischer is already part of this talking about a "bond"-that's rich.Kind of like the "insurance"on 38 Studios?
Boy,it never changes around here.

Comment #8 by Joseph Bernstein on 2014 04 10

I wouldn't want to have a tooth ache with the nerve the owner has.
It takes brass ba!!s to keep coming up with these ridiculous proposals.
My concern is that the geniuses in the GA will fall in line and support this 3 card monty scheme.

I guess the concept of private investment is a thing of the past. Bottom line, this guy bought high, then forced Bank of America out, now wants taxpayer $$. If the proposal was viable, wouldn't private investors be lining up? Nope just insecure politicians.
This latest iteration should be DOA!

Comment #9 by Walter Miller on 2014 04 10




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