Providence’s $200+ million deal with the colleges takes center stage

Providence College is one of four private colleges in the city to strike an in-lieu-of-taxes payment agreement with Mayor Brett Smiley's administration.Steven Senne/AP/file

The Smiley administration’s deals with Providence’s private colleges flew under the radar last week because they were announced on the same day as the special Democratic primary in the First Congressional District, but now the City Council is ready to begin to vetting the agreements.

The council Finance Committee meets at 5:30 p.m. to hear a presentation from chief operating officer Courtney Hawkins, chief financial officer Larry Mancini, and city solicitor Jeff Dana.

As my colleague Steph Machado reported last week, Mayor Brett Smiley’s office negotiated two separate agreements: One is 20-year deal with Brown University, RISD, Providence College, and Johnson & Wales that would generate $177 million in payments-in-lieu-of-taxes; the other is a 10-year arrangement with Brown that will bring in an additional $46 million.

Large nonprofits like the colleges and hospitals aren’t required to pay property taxes, so cities like Providence rely on voluntary agreements to generate revenue.

The new deals were negotiated largely behind the scenes and didn’t come with the usual bickering from either side. Past mayors have riled up residents against the nonprofits to pressure the institutions to pay more, while nonprofits usually use their lobbyists to block major changes. In the end, a kumbaya press conference gets called and everyone pretends they enjoy each other’s company.

This time, there was very little wrangling in public, and the agreements appear to already have the support of City Council President Rachel Miller. There will likely be some councilors and a handful of state lawmakers (the General Assembly doesn’t have a say here) who make the case for the colleges to pay more, but the Smiley administration believes it has the votes it needs to move forward.

The next big question will be negotiations with Lifespan, the state’s largest hospital network. While negotiations with the colleges were cordial, Smiley hasn’t been shy about pointing out that Lifespan is the only large nonprofit that doesn’t currently have an agreement with the city.

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