Despite Pushback, Providence Closer to 30-Year Tax Agreement with ProvPort
November 29, 2022
PROVIDENCE — City officials inched closer, despite significant public outcry, to finalizing a controversial new 30-year tax stabilization and lease agreement with ProvPort Inc., the nonprofit, private-public agency that operates along the Port of Providence.
The City Council’s Finance Committee held a public hearing on the tax agreements Monday night, with members of the public and some newly elected officials taking aim at the “rushed” process and lack of community engagement. The current tax and lease agreements aren’t due to expire until 2024 and 2036, respectively.
“I don’t think it should be going down in this manner,” local resident Everett Pope said. “There are multiple communities that are going to be affected by a 30-year agreement. If it were to take place, I’d be near 60 years old before it expires.”
The agreements received pushback from current and future council members. Council member Helen Anthony made a motion to continue the tax and lease agreements to a future meeting, but the motion died without a second. Anthony told committee members she appreciated the work that went into the agreement, but said it lacked community engagement.
“The Climate Justice Plan, which I am proud this council has passed, is not mentioned at all in this and it doesn’t seem to be impacting any decisions,” Anthony said. “People should be at the table, and we should be adhering to the Climate Justice Plan.”
Council member Pedro Espinal expressed surprise at the lack of discussion prior to the final committee vote, and said it was more proper to have continued the matter rather than rush it.
In written testimony, the city’s Sustainability Commission, created to advise local officials on environmental issues, said the tax agreement failed to be in line with the Climate Justice Plan.
“Collectively, we do not have 30 years to wait on climate action and cannot afford to miss this important opportunity for the City to have leverage on long-term port development plans,” the commission wrote. “The current draft agreements fall far short of what is needed, and what the City has the power to require within the City-owned properties managed by ProvPort.”
The City Council is set to undergo a sea change in January, with seven new council members expected to be sworn in early next year. Three of those — Justin Roias, Sue AnderBois, and Miguel Sanchez — spoke in opposition to the tax deal.
“The speed at which this is being pushed through is undemocratic and goes against good democratic practices,” said Roias, City Council-elect for Providence’s fourth ward.
Under the tax stabilization agreement, ProvPort would have property taxes waived, in exchange for agreed-upon in-lieu annual payments and other stipulations.
Supporters of the deal from ProvPort and Waterson Terminal Services Inc., the private contractor that has operated the facility since 2007, claimed the agreements were better for the city. Under the new terms, ProvPort would pay a one-time payment of $7 million to the city and increase the city’s portion of the revenue-sharing agreement from 5.5% to 9%.
ProvPort has also pledged to pay a minimum of $120,000 annually into a sustainability project fund, and another $120,000 into a community benefit project fund, with $25,000 set aside for projects in the city’s 10th ward, which abuts the port. Via amendment, the agreement includes a prohibition on further expansion of fossil fuel industries within the port until 2052.
Finance Committee chair Jo-Ann Ryan lauded the agreements as financially responsible, and which position the port for long-term and clean energy growth. “The agreements allow ProvPort to immediately attract critical green energy tenants and business in competitive industries like offshore wind development,” she said.
ProvPort is an unusual beast. Unlike most other states, which create port authorities to manage shipping networks, the city instead chose to divest itself from the port’s day-to-day operations in 1994 and endow a 501(c)3 nonprofit to own and operate it. ProvPort currently holds the operating rights until 2036.
In return, the port shares 5.5% of its revenues and pays another $2,000 a month to the City of Providence Neighborhood Improvement Fund. Terminal services have generated $164 million in economic output for the city and $211 million for the state since 1994, according to ProvPort.
Renewable energy developer Ørsted announced last year a pledge to invest $24 million into an assembly facility at the Port of Providence, with another $16 million on infrastructure improvements for offshore wind at the Port of Davisville.
Ørsted currently is the only renewable energy tenant at ProvPort.
Residents and activists have long shone a light on the public health impacts from a number of polluting industries housed at the port, including the controversial Sea-3 liquefied petroleum gas terminal. The port’s proximity to the South Providence and Washington Park neighborhoods, combined with the presence of Interstate 95, have contributed to high asthma rates among residents and children.
A 2019 report, funded by a $500,000 Environmental Protection Agency grant, showed harmful levels of air pollutants concentrated in neighborhoods close to the highway and the city’s industrial waterfront, with Rhode Island having the ninth-highest rate of asthma in the country, with nearly 11% of residents suffering from the condition.
The tax and lease agreements now go before the full City Council for a vote. The agreements will require two passages before the end of the year.