Huge Freight Street project’s tax agreement up for vote

Huge Freight Street project’s tax agreement up for vote

PAWTUCKET – A first-of-its-kind 20-year tax stabilization agreement between the city and the developer of a $21 million housing project off Freight Street is up for a vote of the City Council tonight, Sept. 11, at 7 p.m. in City Hall.

The owner of the property in the area between Freight Street and George Bennett Highway, Freight Realty LLC, is promising a 180-unit residential complex that would bring an extra $700,000 or so in new taxes that the city isn’t currently receiving by the end of the pact.

Current taxes on $487,800 in assessed value for the property located near Stop & Shop on Cottage Street are $16,814. The tax bill on a project expected to be valued at $20,987,800 would be $723,449 by the end of the deal, according to the proposal before the council.

To make the project possible, says developer Ken Zuckerman, he has applied for a 20-year stabilization agreement to begin Dec. 31, 2021, the construction completion date, and continue on for two decades.

The Breeze reported last month that the City Council had approved new expanded guidelines allowing more than a 10-year tax treaty in Pawtucket, including 15-year treaties for projects valued at $15 million or more and 20-year treaties for those valued at $20 million or more. That vote was initiated because of the Freight Street project proposed by Zuckerman and Freight Realty.

Zuckerman previously told The Breeze he was planning 180 market rate units in three new buildings of four stories apiece.

His project is one of five ongoing redevelopments of Pawtucket mill properties, but the only one of those that doesn’t involve rehabbing an existing building. The five projects combined represent nearly $75 million in investment.

Officials have said they want to see more of these projects such as the one off Freight Street, which is why they changed the city’s structure to allow longer-term tax agreements. They note that these projects represent new revenue, so money isn’t coming from elsewhere to fund the tax breaks, and will nicely complement a coming new commuter rail station.

Under the stabilization agreement before the council, taxes would go from $16,814 now to $52,146 in year three, then increasing each year to $10.7 million in year 12, then to $723,449 by year 20. Stabilization agreements phase in new taxes over time instead of accounting for the full value of a new project in year one after it’s complete.