Home japan financial crisis Worcester City Council approves Polar Park overrun loan order

Worcester City Council approves Polar Park overrun loan order

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WORCESTER – A request for a loan order to partially cover $ 17 million in cost overruns at Polar Park gave city council and city administration the opportunity on Tuesday to have a broad discussion on the stadium’s status .

Councilors unanimously supported the loan order and, despite some questions about project details, ancillary development and the terms of the finalized lease, expressed support for the project that will bring the major minor league affiliate of the Boston Red Sox to the city.

As was the case throughout the project, residents continued to voice concerns about transparency and rising costs beyond what was initially estimated by the team and the city. And even as the project nears its scheduled completion date in April, councilors and residents still expressed some confusion on Tuesday over the various cost figures circulating in the community.

The board took the first step on Tuesday by voting 9-0 to announce the $ 14 million loan order. The order has been sent to the committee and will be submitted to council for final decision in the coming weeks.

City manager Edward M. Augustus Jr. reiterated on Tuesday what he said on Friday when the loan order request was made public – that the Worcester Red Sox will be responsible for the $ 17million overruns, not the city. And in exchange for managing the funding, the city and the team negotiated several changes to the finalized lease – which was also unveiled on Friday.

Augustus continued to express confidence on Tuesday that tax revenue from development in the designated area around the stadium will be used to pay off debt on the city’s investment in the park, not taxpayer money.

The loan ordering process will be one of the last pieces of the puzzle needed to secure a final number for the Worcester Redevelopment Authority, which is overseeing the project. The $ 17 million will bring the total cost of the stadium to $ 117 million. The Worcester Redevelopment Authority is expected to consider approving the “highest maximum price” for the project on Friday, and will also consider executing a 35-year lease with the team.

The loan order the city is requesting on behalf of the team is $ 14 million – $ 10 million to partially cover the overruns and $ 4 million to cover the cost of the loan. Augustus said on Friday the team had raised their own funds to cover the remaining $ 8 million in overruns. Augustus said part of the overruns were due to design changes, supply chain issues and unforeseen costs resulting from a seven-week project shutdown due to COVID-19, and costs modernization of the site to take social distancing into account.

District 3 Councilor George Russell and District 1 Councilor Sean Rose both said they have received multiple calls from constituents asking what the real costs of the project are, in light of the different numbers circulating. Russell said that if someone is buying land to build a house, they usually include the cost of the land when talking about their total costs.

Augustus said the $ 117 million figure – including the most recent $ 17 million overrun – only covers actual construction of Polar Park. The other figure – over $ 150 million – includes site work, the cost of acquiring the properties the city was to take for the project, the cost of demolishing said properties and other related work.

Augustus said there is even a “third compartment” that includes building and infrastructure improvements in the area that were mostly undertaken with state money.

Russell also asked what the city’s recourse would be if the team failed to meet their obligations. Augustus said the city would have the same legal avenues it would have in any rental agreement.

District 2 Councilor Candy Mero-Carlson said the project would be good for the city. She said this has already attracted other developments to the city, including recently announced plans for affordable housing in Kelley Square that Mero-Carlson said the city is in desperate need of.

She said some of the terms renegotiated in the finalized lease agreement, which include an extension of the lease from five years to 35 years and an extension to 25 years before the team can exercise their right to leave town, up from 15 years , will further protect taxpayers. And she said let’s not forget that the project was completed with a workforce made up of union workers and 22% city residents.

“It’s something we should absolutely be proud of,” said Mero-Carlson.

Critics of the baseball stadium have long argued that it was not a good idea to spend such massive public investments in minor league baseball stadium deals that, in the end, can leave municipalities in a bind. .

Nicole Apostola called the virtual meeting on Tuesday to remind councilors that when the project was first presented to residents it was valued at $ 90 million, but it quickly grew from there, including $ 30 million overage added last year.

She said the city should have halted the project at this point, but it is now up to $ 157 million. She said councilors’ concerns at the time had been assuaged in private, but the public was not being kept in the loop.

Apostola said the team has also steadily increased its participation. The initial charge of $ 0.50 per ticket quickly doubled to $ 1, and in the finalized lease it can reach $ 2.

She said at a time when residents worry about evictions, jobs and their lives, the council is more concerned with giving grants to the team.

“When will either of you say enough is enough?” said Apostola.

Sue Mailman said she supports the project, but transparency is important when it comes to managing construction costs. She said the numbers are not easy for people to understand, and said it was also important for the city to make sure every contractor on duty is paid – she said sometimes public construction projects can make small entrepreneurs vulnerable.

Mayor Joseph M. Petty said he thought the finalized lease agreement, and the Polar Park project as a whole, was a good deal for the city, and is “even a better deal now” than the city has been. allowed to go back and renegotiate after agreeing to borrow money on behalf of the team for overruns.

Rose and General Counsel Morris Bergman said they heard from residents concerned about the impact of the potential of a truncated season or capacity limits at the new stadium due to COVID-19 on the debt payment schedule.

Augustus said the city has set aside funds in a district improvement reserve fund using the proceeds from the sale of properties it was originally to take by eminent estate as part of the project, but that they were then deemed unnecessary. He said the $ 3 million in proceeds from that sale should be a buffer for the first year.

Throughout the discussion, Augustus repeatedly pointed out the transformative effect that the development of the baseball stadium – which is associated with a private development by Madison Holdings across the street – has had on the Canal District. and the city itself. He said residents critical of the project have long questioned its viability, but said there were other factors to consider. He said he doubted there would be any heightened interest from developers in having a view of a decaying old Wyman-Gordon parking lot.

“I guess the question is then what?” “

He said if the city had done nothing, the old Wyman-Gordon property on which the baseball stadium was built would likely have lay idle, weeded and contaminated, for another generation. Investment in the surrounding area and elsewhere in the city would not have been as massive as it has been, he said. He asked how the neighborhood would be better if nothing had been done.

“I’m asking you how could we have transformed 16 acres in one fell swoop and been able to make all of the state investments that have improved the whole region with these infrastructure improvements, without it? “

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