Worcester Business Journal

wbjournal.com | September 3, 2018 | Worcester Business Journal 9 WooSox deal good for Worcester To entice the Pawtucket Red Sox to move, Worcester will borrow about $101 million to fund the construction of a new Canal District ballpark development, which also will include hotels and apartments. e team is putting up $6 million up front and will pay the city about $30 million in rent over the 30-year lease to help pay back the loans. e city says the project will pay for itself with revenues from a special taxing district surrounding the development. When polled online, WBJ readers overwhelmingly said the deal will ultimately benefit the city, regardless of whether the revenue projections are realized. F L AS H P O L L "Best deal the city has done in a long time! Keep growing Worcester!" COMMENTS: Is the WooSox stadium deal good for Worcester? "The land needs to be used for a good cause. There are enough colleges, medical facilities, courthouses and living environments. We are missing some sports, which could attract some consumers to shop and more tourists." "Would we not be better off building a $100-million school at that location?" No. A $101-million public subsidy is far too much for a city still struggling with high business property taxes. 22% Yes. The ballpark and surrounding developments should attract enough business to generate sufficient tax revenue to pay off the $101 million. 44% Yes. Landing a Red Sox minor league franchise is a coup regardless of whether the development pays for itself. 26% No. Worcester's inconsistent history of supporting sports team will bear out once the novelty wears off. 8% 936,700 $42.3 billion $252,700 22.7% $40,023 $53,110 2 9.5% 4.1% Which market is better? Greater Worcester Greater Providence POPULATION GROSS DOMESTIC PRODUCT MEDIAN HOME PRICE 5-YEAR MEDIAN HOME PRICE GROWTH PER-CAPITA GDP MEDIAN WAGES FORTUNE 1,000 COMPANIES PROJECTED 30-YEAR POPULATION GROWTH UNEMPLOYMENT RATE 1,613,800 $80.2 billion $206,800 15.3% $43,672 $52,220 7 2.9% 3.8% Sources: U.S. Bureau of Economic Analysis (gross domestic product), Bureau of Labor Statistics (median wages, June unemployment rate), National Association of Realtors (home prices), ProximityOne.com (Fortune 1,000 companies), U.S. Council of Mayors (population, projected growth) Grebien said. Despite the dollar discrepancy in public funding between Worcester and Rhode Island, Rea said the team might have stayed in Pawtucket had the Rhode Island legislature approved earlier legislation backstopped by the taxpayers, a bill blocked by House Speaker Nicholas Mattiello. Because of the nature of the legis- lature's dealings, the team faced vocal opposition during public hearings in the Ocean State against putting up so much money for an organization run by wealthy businessmen. ose testifying in the public hear- ings cited 38 Studios, the failed video game company from Red Sox legend Curt Schilling, which went bankrupt aer defaulting on a $75-million state loan. "People were skeptical because of that saga," Grebien said. Another factor playing against Paw- tucket was the extra scrutiny put on the team's value to Rhode Island aer the PawSox failed to get approval over a stadium deal to move to Providence in 2015. at three-year scrutiny included studies, public input and hours of meetings, and it all opened the window for Worcester to engage with the team. "Clearly, Worcester was able to steal them from us," Grebien sid. "It was very transparent here, but they kept everything closed." Behind closed doors Closed, it was. Very few details of the Worcester negotiations were leaked out. at was by design, Au- gustus and Murray said, to avoid the divisiveness created in Rhode Island over the team. "That probably did help," Augustus said. According to Rea, about 20 other New England cities and towns were pitching the club on relocating to their cities. To avoid spilling the beans to the competition, Augustus and Murray structured the deal so it wouldn't need to be made public until negotiations were complete. e tight lips of City Hall officials and business leaders was the product of Augustus attempting to build a rela- tionship with Lucchino and the team. To make a potential 30-year relation- ship work, there needed to be trust. "I needed to make sure that if we get into a 30-year relationship with the PawSox, they were able to trust the person and entity they were getting into a relationship with," he said. "For the time being, that person is me." Augustus was charged with doing everything in his power to get the deal done. He bypassed any legislative approval by utilizing state resources including the Housing Development Incentive Program to pitch in $35 million for the apartment component of the development and MassWorks funding for a proposed Canal District parking garage. So, instead of a public discussion like Rhode Island with people of varying interests debating the good, the bad and the ugly about the PawSox and its owners, Augustus and Lucchino were able to unveil a take-it-or-leave-it proposal in euphoric public announce- ment full of congratulations and cheers. e City Council does have the ability to alter the deal, but the team would need to sign off on any changes. In their Aug. 21 meeting, the council members said they would perform their due diligence but expressed broad support for WooSox and its stadium. "People are just generally excited for this," Augustus said. PHOTO/MATT WRIGHT W

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