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POSTPONED: 110 Westminster Street

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Pseudo_Work Hamlet

Pseudo_Work

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it was a bonus, but i believe it's something that has helped keep historic buildings intact. by offering the tax credits, there was incentive to re-develop the buildings rather than let them become derelict and end up with a public safety complex, grove street school, or fruit and produce warehouse. without those credits, i would not be surprised if we see more buildings torn down for whatever the developer chooses (parking lots seem to be all the rage right now).
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Garris Town

Garris

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Wow, this is really depressing, essentially like watching RI commit economic suicide in slow motion.

When this passed, the headlines were first, "Tax Credit Saved in Modified Form," but as the details become clearer, it seems like they might as well have just scrapped the whole thing for how it's playing out...

And what's up with taking away credits from projects in progress? How's that for a kick in the teeth to a developer taking a chance on RI? Think those folks are coming back?

Disgraceful...

- Garris

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JimmyGreaves Hamlet

JimmyGreaves

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Wow, this is really depressing, essentially like watching RI commit economic suicide in slow motion.

When this passed, the headlines were first, "Tax Credit Saved in Modified Form," but as the details become clearer, it seems like they might as well have just scrapped the whole thing for how it's playing out...

And what's up with taking away credits from projects in progress? How's that for a kick in the teeth to a developer taking a chance on RI? Think those folks are coming back?

Disgraceful...

- Garris

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eltron Hamlet

eltron

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But if they aren't saving the money for education, and they aren't saving the money for social services, then what the hell are they saving the money for? I would like to see what the cutting the historic tax credits will actually do for RI and RIers.
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jencoleslaw Town

jencoleslaw

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I'll tell you who they are saving the money for:

the top 2% of earners in the state.

Jen, there are very comprehensive studies on the credit. I can testify under oath that a teeny tiny bit of tax credit converted an abandoned department store in downtown pawtucket into a pretty thriving mixed-use community of businesses that has created 6 construction jobs, between 20-30 permanent jobs, two new units of technically affordable housing (by the AMI measure, though not restricted), and probably generates about $30k of sales tax a year. Its an investment that pays (paid) back in spades.

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Jenkins Whistle-Stop

Jenkins

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Oh, i know what the tax credits do. I want to know what CUTTING the tax credits will do. I mean, if the funds saved by cutting the tax credit aren't going to be used for social services, affordable housing, education (because we've already been warned that all these things are getting cut as well), then what the hell will it be used for? I want to see what the real tangible benefit (if it even exists) that the state sees by cutting the tax credit. Has anyone done that cost benefit analysis??!
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yossarian Whistle-Stop

yossarian

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I guess I just dont get it.. but why are these projects being affected?? Wouldn't the developer still be able to afford to do all of the projects without tax credits?? Wasn't that program just a "bonus", and wont the developer still make the same amount of money off of the project once finished?

Maybe this isn't the best example.. but thats like when people transfer prescriptions from one pharmacy to another.. sometimes transfer check are involved that are around a $30 dollar value, but you can only get 1 transfer check. When a customer transfers their second prscription and finds out that they cant get another free $30 dollar check.. they say "oh... well I'm going to have to keep this prescription with my other pharmacy"

its like a kick in the face saying.. "oh i was only in it for the $$ incentive and I see no value being here on normal terms"

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Pseudo_Work Hamlet

Pseudo_Work

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As both the son of a pharmacist and someone who uses those coupons and then transfers my scrips right back without even the slightest tinge of guilt, try not to take it personally.

Obviously, your employer did a cost benefit analysis before it started sending out those coupons. They recognized that the coupons would cause X number of people to transfer scrips that otherwise would not have come to your store and that of those a certain percentage would simply game the system and transfer them back. For those people the hassle of the re-transfer is outweighed by the benefits that their old pharmacy offers (perhaps location or an established relationship with the pharmacist) vis a vis your store. However, I am sure there are enough coupon users that leave their prescriptions with you (either because of inertia or because they actually prefer your employer), that your company makes money on the whole deal... and developers are not all that different.

Tax credits are not simply a bonus. They are an integral component of arranging financing for projects. That is not to say that all construction will come to a halt. There will always be projects that are profitable absent a fiscal incentive from the state to build, but there are plenty which are not doable without those credits.

As to the tax credit program itself. I don

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gregw Hamlet

gregw

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In a nutshell, let's say you're a rich taxpayer with a 100K RI tax liability. You buy a 100 K tax credit from one of the historic developers at a discount, let's say 78K. The taxpayer gets to take 100 K off his taxes for only 78K (saving 22K) while the developer gets 78K in upfront money that can be used for construction costs. The developers usually don't use the credits themselves because they don't tend to have large RI tax liabilities because they're from out of state, are non-profits or whatever. They sell them to taxpayers with big tax liabilities though middlemen who also take a cut.

1) That doesn't save the state any money or otherwise lessen the state's financial difficulties, so I'm not sure why we would bother. Because somebody would still be cashing the credits, so what's the difference?

2) Time for a bit of rehash. The tax credit plan is a little complicated, and it's been a while since this was explained to me, and I forget exactly how the credits work, so somebody else will probably have to talk us through the cogs & gears of the plan. But with that said, as I understand it, the credits are of very little use to developers in & of themselves but are of great value to rich individual taxpayers. So the credits are valuable to developers as a means of obtaining money, but indirectly. So we could prohibit the reselling of the credits, but that would just serve to hamstring the program as it currently exists -- or I guess I should say, as it used to exist. Anybody care to help me on this?

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mental757 Burg

mental757

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My idea is that they would need to use the tax credits on THE PROJECT, instead of having some wealthy RI taxpayer purcahse the credits for personal use. The credits are meant to be used in relation to a project, not a rich person.

RI still gains from the benefits of the project (jobs, real estate taxes, higher value, etc., etc.) from an entity that they would'nt otherwise be getting any tax dollars from to begin with...

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runawayjim Metropolis

runawayjim

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My idea is that they would need to use the tax credits on THE PROJECT, instead of having some wealthy RI taxpayer purcahse the credits for personal use. The credits are meant to be used in relation to a project, not a rich person.

RI still gains from the benefits of the project (jobs, real estate taxes, higher value, etc., etc.) from an entity that they would'nt otherwise be getting any tax dollars from to begin with...

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eltron Hamlet

eltron

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Oh, i know what the tax credits do. I want to know what CUTTING the tax credits will do. I mean, if the funds saved by cutting the tax credit aren't going to be used for social services, affordable housing, education (because we've already been warned that all these things are getting cut as well), then what the hell will it be used for? I want to see what the real tangible benefit (if it even exists) that the state sees by cutting the tax credit. Has anyone done that cost benefit analysis??!
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Pseudo_Work Hamlet

Pseudo_Work

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To get back to the 110...here is the sad latest news:

1- The developer has no plans for the site at this time

2- Although it was discussed, Starwood has no plans for a "W" at this time

3- The developer has discussed with some immediate neighbors about taking down the facade and making a surface parking lot until there is something planned..sound familar?

Well, this is a reflection of the economic situation and the inability of the city/state to draw ventures in from outside the state and joins other major "announced" projects that are vacant lots:

- Parcel 12 Hotel Tower (Carpionato)

- Weybosset St Condo Tower (Chase)

- 50 Atwells Condo Tower (Paolino)

- LaSalle Sq-EOB Office Tower (TPG)

Imagine if they all were "on"..what a skyline change! So, now we wait on the economy and watch the city/state efforts.

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