Worcester Business Journal

4 Worcester Business Journal | November 25, 2024 | wbjournal.com I N B R I E F Interest-rate relief "The average mortgage interest rate dropped to the lowest level so far this year in September … This likely contributed to the rise in the number of sales, as buyers took advantage of the brief relief in interest rates." Cassidy Norton, associate publisher and media relations director of real estate data provider The Warren Group, on the rise in single-family home sales in October vs. October 2023 New CFO "I am excited to help support Assumption's growth as a premier institution where students are empowered to lead meaningful lives that include rewarding careers." Jane Clapp on being hired as vice president for finance and administration and CFO at Assumption University in Worcester, effective Jan. 2 Tax credit incentive "The skills, discipline, and resilience of National Guard members make them invaluable to any employer." Jon Santiago, secretary of the Massachusetts Executive Office of Veterans' Services, on the state launching its National Guard Hiring Tax Credit Initiative, a $2,000 tax credit afforded to businesses who hire and retain active members of the National Guard for at least six months BY ERIC CASEY WBJ Managing Editor B reaking the pay-for-itself promise from when the proj- ect was initially proposed, the City of Worcester will need general taxpayer funds to make its payments on the $160-million Polar Park public baseball stadium. Additionally, one of the key devel- opment deals in making the project affordable – for the so-called Le Field Building – has been terminated. A letter from City Manager Eric Batis- ta to the Worcester City Council ahead of the Nov. 19 council meeting has revealed the special financing district around Po- lar Park will have a shortfall of $792,000, meaning the City will have to make up the difference using its general fund. When the City initially proposed in 2018 to build Polar Park in order to move the minor league baseball team Paw- tucket Red Sox to Worcester for the 2021 season, former city manager Edward Augustus claimed the stadium project would pay for itself using increased gov- ernment revenues from a special tax and development district around the stadium. Augustus said this pay-for-itself guid- ing principle was the City's North Star in building the stadium, and Batista echoed that sentiment when he took over as city manager. At the end of the 2024 fiscal year, the City had figured it would again be able to make the bond payments for the stadium financing solely using the fund generated within the district improvement financ- For first time, Worcester needs general fund to make Polar Park payments, as key development deal is terminated ing (DIF) area, but budgeted revenues did not meet what was actually collected by the City, resulting in an obligation by the DIF to the City's general fund of approximately $792,000. To make up the shortfall, the City will pay $792,000 out of its general fund. e plan is for the DIF fund to pay that money back at a future time when the district is generating excess revenues. Over its 30-year lifespan, the City still is predicting the DIF will create $50 million in excess revenues to be paid into the general fund. e City of Worcester didn't offer additional information regarding the shortfall beyond what was in the letter. In a text message to WBJ, City spokesman Tom Matthews said the city wouldn't make further comment until aer the city council meeting. Additionally, Boston developer Madi- son Properties has terminated the tax-in- crement-financing agreement to develop the so-called Le Field Building, which was slated as a bioscience facility, accord- ing to Batista's letter. When the stadium deal was announced in 2018, Madison agreed to build five private residential, office, and hotel developments, which were all key in generating tax revenue in order for the DIF to make the payments on the $160-million stadium. So far, one of those developments – e Revington, a 228-apartment mixed-use project – has been completed. Since Madison has failed to deliver on responsibilities to build the skin, shell, and core for the Le Field Building on top of the completed foundation at the site, the a tax value for the parcel is below what the City was anticipating, according PHOTO | WBJ FILE to Batista's letter.. Problems in the district are not limited to the bioscience site; Batis- ta's letter notes Quarterra, the North Carolina-based developer that had been working with Boston Capital to develop the former Table Talk Pies factory site into apartments, has pulled out of that project. Boston Capital has since found a new partner for the project, but the delay is expected to have an impact on near- term tax revenues. Other developments in the ballpark district are moving ahead at a slow- er-than-anticipated pace, including plans on Madison-owned parcels to construct a second residential building and a hotel, as well as an attempt to construct a state-run crime lab at 115 Madison St., according to Batista's letter. No building permits have been issued for the Madison-owned hotel or residential projects, according to City of Worcester permit records. "Continued progress and investment by our private partners, especially Madi- son Properties, is essential to the bottom line," Batista wrote. Denis Dowdle, president of Bos- ton-based Madison Properties, did not respond to requests for comment. In a separate letter from Worces- ter's Chief Financial Officer Timothy McGourthy to Batista included in the council agenda packet, McGourthy outlined that the $792,000 revenue gap was the result of shortfalls of $344,594 in real estate and property taxes, $62,496 in meals & use taxes, and $384,979 in building permits. W

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