PROVIDENCE — Pawtucket Mayor Don Grebien and a phalanx of Tidewater Landing soccer stadium project boosters made their pitch to Rhode Island leaders Monday about why the state should put up another $30 million in public funding for the project, which is now facing cost inflation.
Over a three and a half hour meeting — much of it held behind closed doors of a state conference room in Providence — Grebien and representatives of the developer, Fortuitous Partners, fielded questions from board members of the state’s economic development arm, the Commerce Corporation. According to Governor Dan McKee’s administration, members of the board don’t want the state to go it alone in closing the $30 million gap.
When Grebien emerged, he sounded optimistic, but also warned about what could happen if the state doesn’t put up more funds for the project, the first phase of which is now estimated at $344 million.
“We lost the PawSox because of a lack of leadership,” Grebien told reporters. “And hopefully we don’t lose this.”
Grebien was referring to the minor league Red Sox affiliate that left McCoy Stadium for Worcester amid political controversy and, from some quarters, opposition to the public’s role in financing the team’s future in Rhode Island.
The Tidewater Landing soccer stadium project grew out of that departure as the city looked to secure another big development and figure out what to do with McCoy. Brett Johnson, a Brown University graduate who also owns the lower-league Ipswich Town FC soccer club in England, proposed an ambitious soccer stadium along the Seekonk River, along with other amenities. Though the proposal didn’t actually include McCoy Stadium itself, which is on a different parcel of land, Johnson’s proposal got picked in late 2019.
The plans include a 10,000-seat soccer stadium in the USL Championship, a lower-tier soccer league in the US, as well as housing, commercial, and retail space. It would turn one of the most polluted areas in the state into a gleaming gateway, visible from Route 95, and use a similar incentive structure that the now-dead PawSox deal was going to.
In February 2021, the state and city announced a financial package for the stadium, which went through some changes from its original conception but still had a soccer stadium at its core. The bulk of the public funding, $36.2 million, was from what’s called tax increment financing. That’s when a public entity borrows money through bonds, then pays them back through the tax revenues generated through a special district — in this case, the special district in and around the stadium. The state’s portion of that was around $27 million, while the city’s was around $9 million.
The project also would get the proceeds of $10 million in Rebuild Rhode Island tax credits.
Though work has already been underway to clean and prepare the site, it ran into significant cost inflation, including structural steel, reinforcing steel within concrete, metals, aluminum, and glass. Those are stoked by the same supply-chain and inflationary pressures that are sending up prices of everything from groceries to gas, supporters said at Monday’s Commerce meeting. The project is also facing higher borrowing costs as interest rates rise.
The first phase of the project has gone from an estimated $284 million to $344 million, according to the city. The stadium alone accounts for about $40 million of that increase.
The developer said it’s putting up $25 million more in private equity. The city, meanwhile, is now asking Commerce Corp. to change the plan first announced in February 2021 to increase the amount of state funding by $30 million, also through tax increment financing.
According to the office of Governor Dan McKee, who chairs the Commerce Corporation board, members of the panel on Monday “expressed that, if we are to proceed with the project, they are looking for non-State revenues to join in closing the $30 million financial gap.” Commerce members did not take any votes.
That leaves something of an impasse. The city points out it has contributed substantially to the project, though the only direct portion of that to close the financial gap that most recently emerged is to delay one part of the project, the $5 million riverwalk. It has also put an estimated $6 million in preparation work and, it emphasizes, given the stadium a 20-year tax treaty under which it would pay no property taxes and a $0 lease on parcels of city-owned land.
Grebien said the city has done its part in many other ways.
“We put in a lot of money,” Grebien said at a media availability organized over Zoom on Monday afternoon, “and we’ve showed that to the board.”
Johnson, meanwhile, said he hasn’t even considered what a Plan B would be if the state says no.
“I’m such an optimist,” Johnson said. “I haven’t even begun to contemplate that.”