One mind on tax treaties?

The city is poised to create commercial tax guidelines to promote development, but if it goes forward it will do so without the support of all interested parties.

A last-minute push from Senate Majority Leader Dominick J. Ruggerio, D-Providence, and the I-195 Redevelopment District Commission for competing legislation to control tax treaties for commercial development along the Interstate 195 redevelopment corridor in Providence was not expected to garner House support last week.

But with the prospect of a special legislative session this fall, legislation proposed by Ruggerio and endorsed by the chairman of the I-195 commission, Joseph J. Azrack, may yet be revived.

The issue of tax-stabilization agreements for the former I-195 land has created a rift between Providence leadership, the commission and state political leaders, leaving open the question of what the long-term approach to development in downtown Providence will be.

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Ruggerio’s legislation passed the Senate, but House Speaker Nicholas A. Mattiello, D-Cranston, threw his support behind city leadership, effectively shutting the bill down in the House before the legislative session was scheduled to end last week.

The rift smears a rosy picture that was painted earlier this year between new I-195 commission and city leadership that an amicable partnership could be formed.

“We could accomplish much more working cooperatively with the commission, as opposed to what’s being created, [which] appears to be an adversarial relationship,” said Luis A. Aponte, City Council president. He expects the city to pass its own tax treaties by July 16.

Azrack last week publicly rejected the city’s tax-treaty plan, calling it “not sufficient to accomplish our shared economic-development objectives,” and urged the General Assembly to support Ruggerio’s legislation.

The city proposal includes a plan for all I-195 development projects exceeding $10 million to receive a 13-year tax treaty, gradually paying more each year after a baseline tax ends after the first three years. This process would be overseen by the city tax assessor.

A lengthier phase-in tax treaty – 20 years – would be established for projects that create at least 150 permanent, career-oriented jobs. The larger projects would have to come before City Council for review.

Ruggerio could not be immediately reached for comment. His proposal would create a 20-year tax treaty for for-profit development projects within the I-195 corridor.

If a state law were ever passed that was inconsistent with municipal procedure, the matter would likely end up in court, further complicating downtown development.

“The general rule on pre-emption is that a municipality can’t enact an ordinance that is inconsistent with a state statute,” said attorney Amy H. Goins, an attorney at Ursillo, Teitz & Ritch Ltd. •

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