Chafee Says $40M for Wexford is the Wrong Priority, RI Commerce Votes for Funding
Chafee Says $40M for Wexford is the Wrong Priority, RI Commerce Votes for Funding
At GoLocal’s studio on Weybosset Street in Providence, former Governor Lincoln Chafee was calling the $40 million in funding for the Wexford project misguided, and just an hour later across the town Gina Raimondo was chairing the Commerce Corporation’s meeting.
Raimondo and the other members of Commerce voted unanimously to up the funding to Wexford’s project. The board approved $13.5 million from the Rebuild Rhode Island Tax Credit Program and up to $1.6 million in sales tax exemption on construction materials.
For Raimondo, the project is the way to kick start the stalled redevelopment of the 195 land. For Chafee, the subsidies are another example of the Raimondo administration’s “candy store” approach to economic development that he first criticized on GoLocal LIVE in an appearance in February.
In 2010, when Chafee was a candidate for Governor of Rhode Island he had opposed state subsidies for 38 Studios.
A GoLocal investigation into claims of job creation by state officials at the 195 Wexford project are at best hyper-inflated.
Governor Gina Raimondo has repeatedly claimed that the $32 plus million in public subsidies will create 1,000 new permanent jobs in Rhode Island. After weeks of requesting information about tenants, rents, and job creation, GoLocal was finally able to secure actual job numbers for the project and then fact check those claims.
In fact, actual jobs created will be closer to 80 to 90, at a cost of more than $32 million.
Raimondo’s Jobs Numbers Inflated
As an example, the project claims 706 permanent jobs will be created by building de facto spec space for Cambridge Innovation Center (CIC), but CIC itself promises only a handful of jobs.
The CIC is a tenant of Wexford and CIC will be leasing the state-subsidized office space for lease. The practice of claiming tenant space as job creation is specifically flagged by federal watchdogs as improper (see below).
“Where's the due diligence that provides a basis for these estimates? Assuming fixed proportions based on square footage is almost certainly going to prove overly optimistic,” said URI Professor of Economics Len Lardaro, when alerted to the job claims.
Raimondo’s Claims
As one example, as part of the 1,000 new jobs being created is the claim that Brown University will be creating 100 new jobs. However, Brown only anticipates creating 15 jobs at the outset.
“Of the 100 university positions expected at the Innovation Center upon its anticipated opening in early 2019, approximately 15 will be new jobs — our School of Professional Studies currently employs approximately 85 people and expects to grow to approximately 100 prior to the opening of the new space,” according to Brian E. Clark, the Director of News and Editorial Development at Brown University.
While the Raimondo administration’s claims for the Brown jobs growth numbers were misleading, the Wexford/Cambridge Innovation Center (CIC) jobs claims appear to be manufactured at best.
The state’s $32 plus million in subsidies to Wexford support the construction of a facility that at launch will only have Brown and CIC as tenants. The Governor is claiming that CIC will create 706 jobs, but in fact the space will have desks and spaces for start ups. CIC does not and will not create jobs, it creates space for start-ups to rent and provides ancillary services.