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R.I. will break ground on the Tidewater project. Here’s what you should know.

The project has stirred hopes for a revival in downtown Pawtucket — and controversy about the public price tag.

Tidewater Landing includes a planned 10,000-seat soccer stadium on the west side of the Seekonk River in Pawtucket, off Taft Street.Pat Greenhouse/Globe Staff

PAWTUCKET, R.I. — Developers and state officials are going to break ground Friday morning on the Tidewater Landing project, the center of which is a $124 million soccer stadium that Rhode Island taxpayers will help fund.

The project has stirred hopes for a revival in downtown Pawtucket — and controversy about the public price tag. Of the $124 million stadium cost, the city and state will finance $45.5 million in costs. Because the state is borrowing to pay much of its share, the actual total for city and state taxpayers will be more than $45.5 million. The most commonly used estimate: $60 million.

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Here are the top things to know about Tidewater Landing as the politicians and business leaders prepare to put shovels in the ground at 10 a.m.

So what are they breaking ground on?

Tidewater Landing includes a planned 10,000-seat soccer stadium on the west side of the Seekonk River in Pawtucket, off Taft Street. The site, once used for heavy industry, has undergone environmental remediation. The developer plans to bring in a men’s team in the USL Championship, the second tier of men’s soccer in America. Kickoff is scheduled for 2024. The developer also says it’ll also be able to host a women’s team, concerts, and other events at the stadium.

Wait. Wasn’t this supposed to be more than just a stadium?

Yes, it was — and it still will be, the developer promises.

To back up a little: When the Pawtucket Red Sox left for Worcester, the state asked for developers to come forward with ideas for a big downtown project. Brown University graduate and Los Angeles resident Brett Johnson stepped forward with a plan to use both sides of the Seekonk River: On the west side of the river, the stadium with other associated accouterments. On the east side, housing, retail, and other amenities. A pedestrian bridge would link the two sides of the river. In the original financing deal announced in February 2021, the state emphasized that most of its financial support wouldn’t actually pay for the stadium, but for some of the work around it.

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Fortuitous Partners founder Brett JohnsonPat Greenhouse/Globe Staff/The Boston Globe

But the developer experienced inflation problems. The budget for the stadium alone soared from about $83 million to $124 million, the developer said late this spring. As a result, after balking at adding more public financing, the state instead shifted almost all of its support for the overall project to the stadium itself. That would leave for another day questions about how to fund the rest of the project. But at least the project would keep it moving, supporters said.

Johnson’s Fortuitous Partners says it’s still committed to the entire project beyond the stadium — that’s where it makes its money. The overall plan: More than 500 multi-family residential units, 60,000 square feet of retail space, a parking garage, parks, boardwalks, riverwalks, an amphitheater. That hasn’t changed, Fortuitous says. In fact the only new thing is swapping out some commercial space for even more housing. What’s still unclear, though, is how much more of a public subsidy the rest of the project will now require. That’s a big sticking point for critics who once supported the overall deal but resisted moving most of the state’s support to the stadium alone.

The new financing arrangement, in fact, was so controversial — a “terrible idea” that stands basically no chance of working, one outside expert said — that the Commerce Corporation board’s vote came in at a tie. Critics worried that the state could end up paying for a stadium, without all the other good stuff. They raised skepticism that passionate minor-league soccer fans would pack the stadium and Pawtucket restaurants, shops, and apartments. Gov. Dan McKee, the chair of the board, can only vote if there’s a tie, and he nudged it across the goal line.

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How’s the state paying for it?

A couple of ways. The developer will get $10 million in net proceeds from state tax credits, which in turn will cost the state $14 million. That will go to infrastructure in the stadium phase.

But the big ticket item is tax increment financing. Here’s how it works. The state will finance $25.5 million for the stadium, plus another $1.5 million in pre-construction work for the rest of the project, by selling bonds through the Pawtucket Redevelopment Agency. The bonds will, in theory, be paid back by the “incremental” — in other words, additional — tax revenue in the area. Over 20 years, it will take an estimated $59 million in payments to pay back those bonds.

The city of Pawtucket is also going the tax increment financing route for $9.2 million, but that’s marked for work on later stages. And the city has pledged another $10 million to help make up for the financing shortfall on the stadium. They’re considering using tax increment financing for that. Reworking the privately-owned stadium’s tax treaty to have them pay some property taxes will likely help pay those back.

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One way to think about the public price tag of $45.5 million in net funds for the stadium: It’s more than any major-league, division-one stadium has ever gotten in public subsidies in all of the region, combined, explained Victor Matheson, a professor of economics at Holy Cross in Worcester. It’s also by far the most expensive USL Championship stadium ever.

But it’s less than Worcester and Massachusetts taxpayers spent for Polar Park, the new home of the WooSox up Route 146.

Wait, tax increment financing? What’s that?

The idea here is that the state will pay back the bonds through the additional tax money the project brings in. State lawmakers drew lines around the stadium and a large swath of the surrounding area to create a special district. (Well, technically three districts, but they can be thought of as one for simplicity’s sake.) The state and the city will pull from state tax revenue in that district to pay back the bonds. It can’t pay the bonds back through non-district sources.

The goal is to be able to pay back the bonds with just the additional money that this big economic development project brings in. You make $5 today, but when there’s a huge stadium in town, you make $8. You’ll pay back the bonds with the extra $3. Even if the stadium flopped entirely, though, and didn’t bring in another dollar, defenders of the deal say there’s enough state tax revenue going on within the district already to more than pay back the bonds.

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But they don’t want to have to do that, because then you’re taking away from being able to pay for critical community needs. So if all goes according to plan, the project’s backers say, the stadium project in its totality would generate enough revenue to pay off the borrowing.

So does the stadium alone pay for itself?

Not as it stands now, no.

Look at the analysis the state commissioned from a consultant called CSL. The analysis estimated that if just the stadium was built, it would generate $37 million in additional state tax revenue in 30 years. That’s not enough to cover the $59 million in state bond payments over 20 years. The math gets even further from working because while the state can only pay back the bonds from tax money generated within the district, that $37 million estimate in new tax revenue includes money for the entire state. (WPRI’s Eli Sherman has a good breakdown of the math and the financing here.)

Defenders of the deal acknowledge the math has gotten a lot trickier due to inflation, but say that once the whole development, including the housing and commercial space, become reality, Tidewater Landing will be a good investment for state taxpayers — and “pay for itself,” as the Commerce Corporation insisted in a statement Thursday.

Commerce board members like Mike McNally maintain the math simply doesn’t add up.

Wow. That’s a lot.

Sure is. But for now, the developer, and the state, want to turn the page. And what’s better for that than beer? Many soccer fans love beer. The developer is planning an event at the Guild brewery later on Friday after the groundbreaking for local soccer enthusiasts. They’re ready, they say, to kick this thing off.


Brian Amaral can be reached at brian.amaral@globe.com. Follow him on Twitter @bamaral44.