PROVIDENCE — A plan to shift already-approved state funding for the Tidewater Landing soccer stadium project in Pawtucket to make sure it gets off the ground was met with skepticism Tuesday from members of the state board that would have to sign off on it.
Governor Daniel McKee’s administration said there was an agreement in principle between the state, the City of Pawtucket, and developer Fortuitous Partners to shift $20 million in state funding to support building the 10,000-seat stadium itself.
That money — the majority of the state’s funding commitment for the overall project — had previously been approved for a later stage of development around the project, which includes housing, commercial and retail space near the stadium envisioned on the banks of the Seekonk River. Moving the money to support the stadium would help make sure the project actually happens, while not committing more public funds to it, McKee said.
But board members of the Commerce Corporation, the state’s economic development agency, questioned whether moving those funds to the stadium would result in only a stadium — and nothing else — getting built.
“Isn’t that a big risk?” asked board member Mike McNally.
The board of the Commerce Corporation met in public for about 45 minutes to discuss the potential deal, debating its merits and firing questions at the developer, then met behind closed doors for twice as long. No votes were taken; the Commerce board would have to sign off for the plan to move forward, because it approved the original funding.
McKee said after the meeting that the reaction had been “mixed,” but a majority of members of the board were in favor of at least getting more information, which he took as a positive.
For weeks, the state has been debating what to do about major cost inflation that is looming over the soccer stadium project, which was supposed to fill the economic development void left by the 2021 departure of the Pawtucket Red Sox for Worcester.
In February 2021, the state had announced a public financing package for the Tidewater project: $36.2 million in what’s called tax increment financing. About $27 million of that package was from the state and $9 million from the city. Tax increment financing is when a public body goes out for bonds, then pays them back through tax revenues associated with a special district. The project, initially pegged at $284 million, would also get $10 million worth of tax credit proceeds.
A few weeks ago, though, facing significant cost overruns, the developer and the City of Pawtucket went back to the state to ask for another $30 million.
The cost of the stadium itself has increased from a budgeted $83 million to $124 million, according to the developer. The overall project has increased from $284 million to $344 million, a city official said recently. The developer said it was committing $25 million more in venture capital and millions more in loans to help. Costs on everything from steel to borrowing have gone up in the last two years.
After weeks of negotiations, the McKee administration came back with a proposal that McKee — who chairs the Commerce board — said would protect taxpayers while keeping the project moving. Under the agreement in principle that McKee outlined Tuesday, the City of Pawtucket would also step forward with $10 million. That funding would be new, but Mayor Don Grebien said exact details on where the city would find it still have to be ironed out.
McKee said ”1B”, the various developments around the stadium, won’t happen without “1A”, the stadium itself. He likened it to a Disney theme park: You have to build the castle first to get everything else around it.
“We need to build the castle, and I think we can do it in a way that’s very responsible to taxpayers,” McKee said.
The meeting was also attended by Fortuitous Partners representatives and Pawtucket officials, including Grebien. Brett Johnson, founder of Fortuitous, is trying to bring a United Soccer League Championship team to Pawtucket, and is also eyeing other sports and events, including concerts.
Stefan Pryor, the state commerce secretary who is poised to step down soon to run in the Democratic primary for state treasurer, said the state would also require clear benchmarks to ensure progress on phase 1B.
On Tuesday, board members like McNally weren’t convinced that 1B would happen if the state pulls all its funding from it to put into the stadium.
“It won’t happen,” McNally said. “Unless the state is going to step up for something like another hundred million.”