Worcester Business Journal

wbjournal.com | January 20, 2020 | Worcester Business Journal 21 Running the numbers on the WooSox deal V I E W P O I N T E D I T O R I A L W ith construction costs up and the land acquisition going more than triple over budget, the City of Worcester is in the process of increasing to $132 million the price tag of the new Worcester Red Sox stadium, set to open in April 2021. In order to absorb the cost increase, the project upped ticket and parking fees and added more properties to the special taxing district where new tax revenues are to cover the sta- dium loans. Based on how most large-scale public projects proceed, it would be naive to think there will not be additional increases over the next year. Reading the administration's 132-page report to the City Council, the promise that revenues from new development in the immediate area of the sta- dium will more than cover the stadium's debt service is laid down as not just as a guiding principle, but an ironclad promise. Continuing to make that guarantee isn't wise, or realistic. As costs rise and developments around the stadium encounter the inevitable un- foreseen circumstances – just like the circumstances causing this latest expensive increase – the project paying for itself just won't be in the offing. But that doesn't mean the stadium will be a failure. On the contrary, the pending WooSox arrival has been a rallying cry from outside investors who are putting money into the city. ere was growing mo- mentum in Worcester well before the Boston Red Sox minor league affiliate went looking for a new home, and if the team had decided to stay in Pawtucket, it's hardly as if Worcester would have been crestfallen. But, there is also no question the WooSox imminent arrival has allowed Worcester to double down on the buzz. Two high-profile Worcester economic devel- opment announcements at the end of 2019 – the two-story restaurant in the Mercantile Center and the planned demolition of the Greendale Mall in favor of an open-air lifestyle center – both cited the WooSox's plans to come to the city as a major motivating factor. Neither project is close to the district where the new tax revenues to pay for the stadium are supposed to be generated, but they will increase the overall tax collections in the city. Nonetheless, we applaud the effort to hold the project accountable to the high standard of paying for itself, and the city administration should remain ac- countable for the baseball stadium not hamstringing city finances or compromising other priorities. e city must keep a watchful eye to mitigate any future cost overruns. Worcester's bond obligations float- ing up from $101 million to $132 million (plus $5 million in expected operating costs over the next 30 years) happened pretty quickly. Another $19 million more, and this becomes the most expensive stadium project in minor league baseball history, surpassing the $150-million stadium for the Las Vegas Aviators. Yet, a better measure for judging project suc- cess than the tax revenues from properties in close proximity to the new stadium would be the overall municipal tax revenues rising at a healthy pace, as the dividend of the current economic momentum is driving new projects across the city. e challenge for the city is to use that leverage of the hot market to cut better deals – giving less in subsidies and tax breaks as the appeal of properties here goes up. The Worcester Business Journal welcomes letters to the editor and commentary submissions. Please send submissions to Brad Kane, editor, at bkane@wbjournal.com. A T H O U SA N D WO R D S B Y D O N L A N D G R E N W New England's wish list to Congress for economic growth A s 2019 drew to a close, so too did the first half of the 116th Congress. And as is oen the case at year's end, our leaders in Washington, D.C. ended the year with a flurry of activity. In its final week on Capitol Hill, Congress passed a $1.4-billion spending bill to fund the government through September. Included in that bill were several top priority measures for e New England Council: boosting retirement savings, re-authorizing the terrorism risk insurance program, and renewing the charter of the Export-Import Bank of the United States. As our leaders return to Washington, D.C. in January, the expectation is – like in all presidential election years – it will not be a terribly productive year. However, Congress could take several actions to support continued economic growth in our region. 1. Invest in infrastructure– Nearly 1,600 bridges are in "poor" condition across New England, roughly 9%. Last year, Washington could not reach agreement on an infra- structure package even as such investments are critically needed. is fall, a renewal of the 2015 FAST Act – Amer- ica's surface transportation law – must occur. A key Senate Committee last July approved a $287-billion replacement. Perhaps Congress can aim higher and address our region's additional infrastructure requirements as well. 2. Promote investment in renewable energy. New En- gland has become a leader in the development and deploy- ment of offshore wind energy. Our region is home to the nation's first offshore wind farm and more are in develop- ment, helping reduce our carbon footprint while creating hundreds of jobs. is tremendous growth is due in part to tax credits for the development and production offshore wind, which have unfortunately expired. Several proposals have been introduced to reinstate and extend these credits, with support from members of the New England delegation. Congress needs to extend these important incentives. 3. Ensure banking for the cannabis industry. In New England, marijuana has been legalized for medical and/or recreational use in all six states. However, because marijuana is illegal under federal law, legitimate cannabis enterprises cannot bank at any federally insured financial institution, and are forced to operate as cash businesses, at risk for the and fraud. Fortunately, last year, the House passed the SAFE Banking Act, which would establish protections for banks to provide financial services to legal cannabis businesses. e Senate should follow suit and pass this bill. e good news is all three of these items enjoy strong support from the New England Congressional delegation and strong bipartisan support nationally. Action on these items would no doubt result in job creation and economic growth here in New England and will show Congress can indeed act in a bipartisan manner to advance policies benefiting the nation. James T. Brett is president & CEO of e New England Council, an alliance of businesses and nonprofits dedicated to economic growth. BY JAMES T. BRETT Special to the Worcester Business Journal James T. Brett W

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