Next Hearing on Major Development Plan for Former Wickford Elementary is Tuesday

The next public hearing on the Wickford El project, which would transform the vacant former Wickford Elementary School site in North Kingstown into an art hotel, conference center, business center and residential complex, is next Tuesday, Nov. 3.

Last month, the first public hearing on the project was held and residents peppered developer Andy Kinnecom with questions and concerns about traffic, parking the scale of the project and other concerns.

In advance of the meeting, the developers have put together a new list of frequently asked questions in the hopes of calming fears and rounding up support for the project, which is about to begin the formal planning process.

To read our complete story about the project when it was first unveiled, go HERE.

The meeting will be held at North Kingstown Town Hall at 5 p.m.

Here is the new FAQ:

What provisions will there be for onsite parking?

Since a large portion of the property is in a flood zone, the new buildings will have to be raised on piles or stilts. This will allow for garage areas on the ground floors, which would be approximately at current grade and provide enough parking space for the residential, hotel, and condo portions of the complex.

What about the stone wall?

The developer has expressed that the stone retaining wall will remain largely intact. The final drawings will tell.

Has there been a traffic study?

At this stage there has been no traffic study. When applying for permits a traffic study will be required.

Will light and noise pollution be addressed?

Mr. Kinnecom has acknowledged the concerns of the immediate neighbors and pledged that his design team will be sensitive to sound and light. It should be noted that although there will be a hotel operation, the campus will be substantially residential so these considerations will concern the residents onsite as well.

Are there any drawings available?

Now that Mr. Kinnecom has a basic agreement with the Town he can move forward with architectural and enginering work. He has stated that in November or December he will be able to publicly present a final version of the project. In the mean time

this drawing is from his website

www.wickfordel.com. We’ll post more drawings as they become available.

Has the zone changed for the property?

No. The Planning Commission will take up proposed zoning changes soon.

This project is expected to be a game changer for Wickford — why?

Wickford El will help restore vitality to Wickford Village, stabilize its economy, and ensure its future. The hotel and residences will create an anchor for year-round new economic activity. Wickford’s prominence as a regional arts center and destination will be advertised regularly through hotel operations. Wickford El’s sewer assessment will make sewer service affordable in the low-lying land-strapped village where it is most needed. Nearby properties and businesses will increase in value.

How does this project affect Wickford’s sewer prospects?

The sewer proposals for Wickford were enabled by the hotel project that fell through last year. That project included 37 rooms and would have contributed approximately 2 million dollars to the sewer installation. The Wickford El project would add substantially more rooms and therefore be responsible for a greater total cost. The cost share borne by the village businesses would therefore be substantially reduced. Although both Wickford El and sewer construction, it is clear that without a robust housing-based development at Wickford El the cost of sewers in Wickford would be prohibitive.

Why does Wickford El matter to North Kingstown?

Redeveloping Wickford Elementary School will add value to the town of North Kingstown as a whole in terms of attracting business and visitors, generating employment, improving transportation, and preserving a valued historic asset. Wickford El will add amenities not currently available in North Kingstown a premier hotel, restaurants, conference facilities, and more. North Kingstown will gain national recognition as an ideal location for events, small conventions, and corporate and spiritual retreats nestled in quaint and authentic surroundings. By its scale the project will attract new private investment to the community. Hundreds of temporary construction jobs and the equivalent of about 40 full time permanent jobs will be created. Transportation links from the railway station, airport, and Newport will be added at no cost to the taxpayer. Above all, a historic landmark will be preserved.

Will the project help North Kingstown’s finances?

The project will transform a public liability that generates no income into a valuable $40 million taxable campus that generates a steady stream of property and hotel tax revenues for North Kingstown. It also adds little demand for town services and has no impact on the school budget.

What about the Olde Meeting House and playground?

The parcel of land along Boone Street is not part of the Wickford El project. The Meeting House will be on its foundation and fully restored using preservation grants. There is money already secured for the Heritage Park playground on that parcel as well. Wickford El will be landscaped to embrace the park.

Is it clear that there are no alternative commercial uses for this property?

There appear to be no alternative commercial uses for the Wickford El property that would preserve the school building as a historic asset. The property has been in the market since North Kingstown voters in 2011 authorized the town to sell it, but there has been little interest. The building cannot be occupied for any use in its current state. A project proposed in 2014 to renovate the property as a hotel stalled as state tax credit needed to bring it to buildable condition appeared elusive. The Wickford El proposal to which the town has agreed is one of only two received in response to the town’s request for proposals issued in October 2014. The other proposal, for an assisted living facility, was withdrawn. There probably would be considerable demand for the property if the school were demolished, but it is unclear what the total benefits to Wickford and the town would be under this scenario.

Why is the sale price a fraction of its value?

The market value of the property lies entirely in the land, five acres of rolling waterfront terrain within the land value of the 12.5 acres occupied by the Wickford Middle School is 1 million. But the school building reduces the market value of the property. In is present condition the building cannot be occupied for any use. Due in part to its historic status, renovation or removal becomes problematic and the cost is difficult to justify on a business basis. So whether or not the agreed upon price of $500,000 is fair or not is conditional on progress in preparing a development project worth $40 million including payments to the town several times the sale price.

Why does the project have to be so big?

The economic value of the project needs to be large enough to support the operations that the developer has envisioned. There is a minimum scale below which the project is not viable as a business. As a seasoned developer and hotelier he must decide what size will work. In addition the total value of the marketable properties included in the project needs to generate enough new property taxes to service the TIF bonds. This balance will be proposed by the developer and evaluated by experts of behalf of the town. As for the physical size of the project, the preliminary architectural design shows building heights similar to those of the existing school, which should not materially affect the views from Wickford. The developer is keenly aware of the need to preserve the visual appeal of the village and its surroundings.

How can an inclusive and self contained development help the village?

Wickford El and the village are likely to become closely intertwined. Wickford provides the environment that is necessary for Wickford El to succeed as a housing or lodging alternative. Initial interest reportedly for more than 35 reservations for condominiums is primarily from local residents who want the convenience of a condo but are adamant about remaining in Wickford, where condos are not available. This reliance on an inclusive campus. As far as the hotel or event visitors go, the attraction of Wickford El is its privileged location in an authentic seaport village and an arts- rich community. A concentration of potential customers within walking distance of the heart of Wickford is definitely valuable to village merchants.

How will this project affect my taxes?

The development of Wickford El will decrease the upward pressure on property taxes as the addition of high density taxable property will broaden North Kingstown’s tax base. This particular development will also stimulate the surrounding business community resulting in an increase in commerce and fostering improved valuation of commercial properties. Additionally, the anticipated load on the North Kingstown school system will be negligible so the share of property taxes going from the town to the school department would decrease.

What would be the approximate square footage of the complex as initially proposed?

The existing building has 33,100 square feet of floor space. The exact size and configuration required for the developer to achieve market based goals is currently in flux. Mr. Kinnecom, however, has initially estimated that the total combined floor space would be up to 180,000 square feet. Once the architects have completed drawings, engineers and brokers will analyze them for structure and marketability. Only then will the full picture come into focus.

Shouldn’t my home be eligible for the same tax refunds that Wickford El will receive?

Not unless you are investing in taxable improvements to your home that would meet a need of the community, but you cannot finance it entirely on your own. The Wickford El project will transform a public liability that generates no income into a valuable $40 million taxable campus that will generate a steady stream of property and hotel tax revenues and other benefits for North Kingstown, but would not be financially viable without using some of the new taxes to repay part of the project cost.

Lighting of Wickford El will intrude in the surrounding nature and homes disrupting established living patterns and village appeal. What can be done about this?

In response to residents’ concerns, and also to ensure the wellbeing of condominium residents and hotel guests, Mr Kinnecom has committed to incorporate good practices of light pollution mitigation in the design of the project. Practical steps can include changing the spectral composition of lighting (especially LEDs), limiting the duration of lighting, reducing the trespass of lighting into areas not intended to be lit, altering the intensity of lighting, and preventing areas from being artificially lit in the first place. Wickford El could pioneer good lighting practices that reconcile the needs of development and preservation of quality of life.

Why develop Wickford El if the property will be underwater soon?

for some time. According to the National Oceanic and

Atmospheric Administration (NOAA):

The mean sea level trend is 2.74 mm/year with a 95% confidence interval of +/- 0.17 mm/year based on monthly mean sea level data from 1930 to 2014 which is equivalent to a change of 0.90 feet in 100 years.

This would indicate that barring any natural weather or seismic event, and if current trends are sustained, the property will remain dry land for several hundred years to come.

Will developing Wickford El increase flooding elsewhere and how will it affect insurance rates?

An expert has been consulted with in regard to flood hazards. She insists that a development at Wickford El would not jeopardize any adjacent or nearby properties. Furthermore flood insurance rates for area properties would not be affected.

What is tax increment financing (TIF)?

TIF is a financial instrument widely used by US municipalities to partner with private projects of public interest. The municipality borrows money to help pay for investments that will help generate new tax revenue, and pledges to use this future tax revenue to repay the debt. TIF is used when investments needed by the community would not be financially viable on their own, such as to redevelop a blighted area or enable new investment benefiting the community at large.

Should we be concerned about TIF’s?

Tax increment financing (TIF) is a key component of this plan. Without TIF, preserving the school building may not be a viable business. TIFs are simple to conceive but their specific application can be exact answers but we can explore TIFs and how they may apply.

When will the developer be applying for the TIF and is it subject to voter approval?

Agreement between the town and the developer on a plan to issue and disburse tax incremental financing (TIF) municipal revenue bonds is a condition of the sale and subsequent development of Wickford El. State law does not require municipal revenue bonds to be approved by voters, but the Town Council has decided that full disclosure and understanding is in order. The public will therefore have every opportunity to stay informed and comment.

Are TIFs tax breaks?

No. The tax abatements available for development will be waived and the property will be fully taxable to the extent of its value from the time it is sold. It is this new tax revenue, expected to approach 1 million dollars annually when the property is fully developed, that will be dedicated to repay the bonds. The town and taxpayers are not obligated to repay these bonds beyond the extent of the tax income generated by the project.

If the TIFs are agreed to, isn’t 25 year excessive?

TIF bonds typically have maturities of 20-25 years, but successful projects often repay them in 15 years. There are many market and performance variables that affect future tax revenues so analysts require revenue projections that exceed the amount necessary to repay the bonds in 20 years. Proforma revenue projections to be prepared by the developer will be reviewd by TIF financing experts on behalf of the town.

Why is TIF necessary?

The Wickford El project would not be viable without TIF financing of about one-fourth of the total investment. The property would be worth more without the school that is the focus of preservation. TIF financing is needed to offset this difference and redevelop the school rather than demolish it and build anew. Wickford Elementary School is vacant since 2005 and has become an eyesore and safety risk. In 2011 North Kingstown voters authorized the town to sell the school, but there have been no takers. A hotel project proposed by a developer in 2014 stalled as state tax credit needed to bring the property to buildable condition appeared elusive.

Why did California close down TIFs? What are they doing now?

The state of California closed down the urban redevelopment program and implementing agencies, not the use of tax increment financing (TIF).

The 60-year old program had successfully created and preserved jobs, boosted local economies, increased taxes and other revenues to local governments, revitalized blighted areas, and produced affordable housing. TIFs are a time-tested financing tool accepted by bond markets, and were by far the largest source of funding of this program, amounting to about 12 percent of total property tax revenue statewide.

But by state law 50 percent of all property taxes go directly to the school districts, so earmarking new taxes to finance development projects cut into school revenues. The state was required to repay the school districts for every dollar they lost to TIF. A major state budget crisis made this arrangement unsustainable. Moreover, there was growing concern that the urban redevelopment program had overextended its reach and used to attract new shopping centers, sports facilities, and other high-profile projects well beyond the original intent to revitalize blighted areas. There was also concern about lack of transparency and complex procedures that had evolved during 60 years of legislation.

The redevelopment program and agencies were terminated in 2012. But legislation enacted in 2014 set new rules and procedures for enhanced infrastructure financing by local governments. The law provides that TIF may be used to help finance public capital facilities or other specified projects of community wide significance. This includes streets, transit, parking, sewers, recreational facilities, libraries, child care facilities, affordable housing, and projects to implement sustainable community strategies, among others.

Suggested reading:

1. Fulton, William: “Redevelopment Financing Gets an Overhaul in California”, Governing the States and Localities, March 2011

http://www.governing.com/columns/eco-engines/col-redevelopment-financing-gets-overhaul-in-california.html

2. ULI San Francisco District Council: After Redevelopment New Tools to Promote Economic Development and Build Sustainable Communities, November 2013 http://sf.uli.org/wp-content/uploads/sites/47/2011/05/ULI-SF_AfterRedevelopment_FINAL_18Nov131.pdf

3. Peterson, Sarah Jo: “Tax Increment Financing: Tweaking TIF for the 21st Century”, URBANLAND, The Magazine of the Urban Land Institute, June 9, 2014 http://urbanland.uli.org/economy-markets-trends/tax-increment-financing-tweaking-tif-21st-century

4. State of California: “SB-628 Enhanced infrastructure financing districts (2013-2014)“, enacted September 29, 2014

http://www.govexec.com/state-local/2014/11/california-tax-increment-financing-tif-law/98771

What is the effect of TIF on schools?

In North Kingstown, tax increment financing (TIF) of Wickford El would have no direct effect on schools. Funding of the School Department is allocated by the town through the budget process. Tax revenue from existing properties will continue to accrue entirely to the town. Tax revenue to repay TIF bonds will come only from new property value developed with TIF support. Indirectly, schools may gain as new Wickford El will generate little or no new demand on schools, while the town’s tax base from which schools are funded will increase as the value of nearby properties rise.