Finance Committee — July 22, 2026

On Wednesday, July 22nd, call this Committee of Finance to order.

Note this meeting is being live streamed and recorded.

City Council committee meetings can be viewed on the City of New Bedford's homepage Under Quick Links, then Meetings in Attendance tonight, we have Councilor Elijah E. Abreu, Councilor of Ward 2 Scott Pemberton, Councilor of Ward 1 Leo Choquette, Councilor at Large and First Vice President Shane Burgo, Councilor at Large and Second Vice President Naomi Carney, and Councilor of Ward 3 Sean Oliver, and myself, Joseph Lopes, Councilor of Ward 5 and Chairman of Finance.

We have one— we have letters to be read into the record.

We do.

We have 2 letters to read into the record.

This one's from Councilor Gomes.

I'm writing to inform you that I expect to be late for tonight's committee meeting.

As I will be attending the Traffic Committee meeting at this time.

Please read this letter into the record to make my colleagues and the public aware of the reason for my delayed— delayed arrival.

This one's from Councilor Pereira.

I'm writing to inform you that I'll be delayed in arriving at the Committee on Financing on Wednesday, July 22nd at 7 PM due to attending a community meeting.

I ask that you read this letter into the record to make my colleagues, those in attendance, and the public aware of the reason for my delay.

Can I get a motion to receive and place on file?

Made by Councilor Carney, seconded by Councilor Abreu.

All those in favor?

Opposed?

The ayes have it.

Item number 1 is communication.

Mimic City Council submitting a proposed housing development incentive program tax increment exemption agreement and resolution approving a tax increment exemption TIE for the redevelopment of the vacant Holy Family Elementary School located at 91 Summer Street into 44 condominiums.

It was referred here on June 11th, 2026.

1A is the housing development incentive program and 1B is the resolution.

Made by Councilor Abrams, seconded by Councilor Burgal.

All those in favor?

Opposed?

The ayes have it.

Mr. Amaral, would you like to give us a brief synopsis on the project?

Good evening.

Uh, thank you, Chairman Lopes and members of the committee.

I'm here once again with a tie agreement for a new housing development in the city.

As you know, the state has the Housing Development Incentive Program, HDIP.

It's a state tax credit program to subsidize housing development in gateway cities.

We've had some success with this program over the last few years with a few different awards.

One of the key requirements to accessing that— those funds is that the municipality show support for the project and basically matching support financially for the project, typically by way of a tax increment exemption agreement.

So within the confines of what the law prescribes, the municipality grants some tax relief on only the improvement value of the building.

So the city receives more tax revenue than it ever had before, but the developer gets a little bit of a break to help make the numbers work on the overall project.

The value of the tax increment exemptions that we've tended to adopt here in the city are— the value is very modest.

However, it opens the door for tax credits from state government that are not so modest.

They're up to $3 million currently, which can really make or break a project like this one.

J. Peter Vanko is the proprietor of Vanko Studio Architects.

They are the developer behind this project.

They're experienced with adaptive reuse projects, historic buildings, comparable projects to this, so have a track record that speaks for itself.

The project that's before you is 91 Summer Street.

Most recently, you may remember that as the Holy Family Holy Name Elementary School for a very long time.

Before that, it was the Cook School and a city building built 100-plus years ago.

It sat vacant since that school has closed until Mr. Vanko has come to terms with the diocese for its renewal.

He's put forward a very high-quality plan and design that's sensitive to the neighbors.

That adds parking that isn't there now to try to accommodate both the new residents and the neighborhood in general.

What we have put forward with him and has been endorsed by the TIF board is a 10-year agreement which graduates the, uh, basically the, the tax hit on the new valuation of the building.

Uh, in year 1, 80% of that new value would be exempt, and then it decreases 10% a year through year 10.

So at the end of the agreement, it would be 10%.

What is different about this development from other HDIP projects that we've brought before you is that it is proposed as a condominium project.

So each unit will be owned.

The tax benefits are not particularly the developers.

They will actually be to the benefit of the residents who purchase these units and live in them as condominiums.

So we have some estimated values on this, but they shouldn't be taken to mean that Vanco Studio is going to have less tax obligation.

It's going to be the 44 owners of the condos that will have less tax obligation.

Vanco Studio will simply finance the construction of the development and then sell those units.

We calculate the overall improvements to the building between $5 and $6 million, and the exemption over the 10 years would total $230,000.

During that time, we estimate that the city would receive $389,000 more than it otherwise would have.

It's actually much more than what the city otherwise would have, because until recently, this property has been tax exempt for the last, you know, 100 years or so.

So we think it's a good deal for the city.

Most importantly, it helps address our critical need for more housing in the city and in particular, more housing that's helping folks build equity through homeownership or in this case, condo ownership.

If you have any questions, I'm happy to answer them.

I know Mr. Vanko is here as well.

And is happy to speak to the project.

Councilor Abril, you're first.

Thank you, Mr. Chairman.

Good evening, Josh.

Good to see you.

Um, I— you could have mentioned this during your open, but I didn't hear it.

And if you have to repeat yourself, I apologize.

But these 44 units, um, do you know— are we talking market rate, workforce, affordable, a combination of all?

Or what are we looking at here for the rents and where we're going to be at with this?

Yeah, in their current iteration, there's no income restriction on the units.

However, I would say that the anticipated sale prices of the units is reasonable.

So in the summary, we have it here from Mr. Vanko.

The sale prices of the units range from $185,200 per unit up to a maximum of $327,690 per unit.

I think in, in both cases, certainly on the lower end, but even the higher end the mortgage payment on those units would be less than your typical market rate rental were it to be a rental project.

And so we're excited about the possibility of folks that may aspire to be single-family homeowners someday, but being able to get in the door with condo ownership and then, you know, perhaps eventually moving on from that.

But those rates are reasonable.

So, okay, I just would— to summarize, I would say it's a market rate project, but market rate doesn't necessarily mean you know, out of the price range of New Bedford residents.

Okay.

And this could be for the Vanco representative, but maybe you would know since you were in on this and you've studied this at great length.

The Vanco Studio Architects, have their architects or the development team at Vanco, have they completed similar adaptive reuse projects in the past similar to this?

Yes, I think it would, it would be beneficial for the council to hear from Mr. Vanko himself, but it's known to me that he's participated in similar projects, including in Fall River, adaptive reuse of similar aged, similar constructed buildings, and those projects have been successful and then highly marketable to local residents.

Thank you, Josh.

Mr. Chairman, what I'll do is I'll yield at this time if others have questions for Josh.

I had 2 other questions, but it was more for Mr. Vanko, so I'll yield at this time.

Thank you.

Thank you, Councilor Abreu.

In attendance, we also have Councilor Baptiste from Ward 4, Councilor-at-Large James Roy.

Councilor Burgoyne, you're first.

Thank you.

Um, I just had, I guess, a clarifying question regarding how the tie, um, would affect the— in the situation we're selling these as condos and the ownership, you were, I guess, kind of touching base on the fact that it would affect essentially the condo owners in this sense, would they be— I guess my question is, would they be notified of this situation, seeing as the fact that each year there's going to be a reduction in the TAI over the first day?

I think it's like 10%, then until it reaches that, the 20% reduction, then it goes to 15%, and then 10%, 10%.

So I use the word reduction, but we know a reduction in the exemption is really an increase in their tax bill.

Are they going to feel as though, like, What the hell, my taxes keep going up even more than anticipated, or are they going to understand that's because the exemption is being lifted little by little each year?

So a couple thoughts.

We have given that some consideration.

First and foremost, I would imagine that in the sale of these units, that will be part of the marketing materials, right?

It would be— you would, you would be aware that you're buying a unit that comes with this, like, tax relief for the first 10 years.

I think for the first several years, You know, that might play out differently as the units fill up, and they might be owned by one condo association or by the developer, depending on how quickly they, they sell and how they're developed.

We have structured the TAI agreement very gradually on purpose with that in mind.

So other TAI agreements that we've brought here might be, you know, 80% exempt, 80% exempt, 50%.

20%, right?

So you've got these big cliffs where in effect that tax bill is doubling for the owner of the property.

In this case, we've graduated at 10% a year, and the last 2 years, years 9 and 10, are both 90/10, and the years before that just go in 5% increments.

So it's 80/20 in year 7, then 85/15, 90/10, and then 90/10 again.

And we thought that that would be the best way for those taxpayers to, you know, kind of be brought on the off-ramp, if you will, from the TIE agreement.

But we'll have to make sure that there's some notification given to those folks throughout the process.

Do we know if this will affect their financing in terms of if they're— depending on how much the condo is going to cost, if they're taking out a mortgage to purchase the condo, will that affect their ability to get a mortgage I don't think so.

I don't think so.

If anything, it should help, right?

Because it will reduce what they would pay for a duration of time.

The bank may underwrite their mortgage at the, like, year 10 number perhaps.

But I'll be honest, if the units are selling, like, for $200,000 or so, the 10% increment might be fairly minimal on that one unit, which is not to say that someone's property tax is going up $200 a year or something like that might be minimal.

We're going to lower everyone's taxes.

We always are going to do that.

Exactly.

Um, in this case, uh, we'll have to be mindful of that as the project gets started.

Perfect.

Thank you.

I yield.

Thank you, Councilor Burgo.

Councilor Carney, on your first.

Yes, thank you, Mr.

Chair.

Um, my good councilor to the right was on the same track that I was.

It's the, the, the tax incentive goes to the property owner once they purchase.

Yes.

So, um, I mean, I mean, that's a nice thought, whatever, but I'm thinking about all the other people in the city buying houses and whatever houses for sale, and, um, individual people were sitting there looking at taxes and we're not giving anybody else a tax relief.

I'd like one of those too.

Can I get a— as would I.

But yeah, but I'm, but I'm saying I, I, I get the idea, but I don't like the length of time and the amount, because we have so many taxpayers in the city, I, I don't think it's really fair to pass it on.

Now, it was developers showing us that the jobs creation to build the project and all that stuff falling in there, but to pass this on to an individual who's purchasing, I think it's kind of unfair to the taxpayers of New Bedford who are already paying taxes and don't get any breaks.

I understand the thought process.

What I would say is, first and foremost, we want to create the 44 units of housing.

In order to create those 44 units of housing, Vanco Studio needs access to $2.5 million of state tax credits to make the project work.

In order to access those $2.5 million of state tax credits, they need to have a TIE agreement in place.

And so we've structured the TIE agreement this way.

It could be for fewer years, it could be for more years, it could be for more dollars or less dollars.

I could— I would like to say if less dollars and for fewer years, that would be more palatable for me.

But at the 10-year mark, I'm not for that.

Maybe if you go to 5 years and reduce that so it's not— I understand that they need this to, to access other tax credits.

I mean, so we're looking at not getting many taxes out of this in the first few years.

Shorten it, shorten it up and lessen the tax credit so they can get so they can have a tax incentive.

But for 10 years, for people coming and buying, it's a hard pill to swallow when we just hit everybody on their property taxes.

And I just got my bill that went up.

So it's, it's a tough pill to swallow to approve something like that for 44 units.

So 44 homeowners.

Understand your point, Councilor.

I do hope the council considers it regardless.

If the tie agreement is not approved, it was endorsed by the TIF board with no problem.

If the tie agreement is not approved tonight, it will, it will likely imperil the project's ability to move forward until the spring of 2028 instead of next spring, if not sooner.

So you mean to tell me that the, that the, the board can't go back and take a look at this and shorten it up?

The, in a They, they could, they could, but the next time for the developer to apply for the state tax credit is in December.

So you would miss this current round and then have to wait 6 months, which would create a backlog of other projects, right?

Once again, it comes before us that the thing, if you don't do it now, it's done.

Well, I'm not going to be hanging like that anymore because it, it, it happens all the time.

The administrators in administration because something and it's so time sensitive that, oh, if you don't do it now, then you're going to lose everything.

It happens all the time.

So I'm sorry, but I can't agree with it.

Send it back, shorten it up, make it small so they can get their, their grants, and I'll be happy to look at that.

But for 10 years at these increments, I don't think it's fair to the rest of the residents in the city.

Understand your point.

Okay, respectfully, the, the council's approved these when the the tax benefits are held by the developer.

So in this case, they're held by the residents, which I understand the thought process, but it's the same difference really for the city.

Well, well, when the developer comes before us and stuff like that, we're looking at more or less— I mean, they're creating jobs to bring in more stuff, and people are getting paid to get these things up and running too, which, which they would be in this project just the same.

They wouldn't— that, that part doesn't change, right?

But the project may never proceed.

Without the agreement, right?

But I— but the tax incentive is going to the homeowner for 10 years, but the project is still enabled to happen, right?

It may not happen without it.

That's okay.

I mean, I'm just saying that it's— once again, it's— it's— you can't send it back to just tweak it to make it more palatable because you're on a time-sensitive— all development is imperiled by time.

Right?

So if our answer is we can't proceed, the costs of the project increase, the construction costs, the carrying costs, and then there's no guarantee of success with a competitive state program.

So it would introduce significant risk to the project because we don't want the 44 condo owners to achieve a relatively minimal savings on what they would otherwise charge.

It's also possible that the potential owners of these condos might pay a smidge more because they're paying based on their monthly payment, which would include the taxes.

So, um, I think it's— yeah, I, I pay a mortgage and I pay it monthly and my taxes are in there too, so I understand that.

Thank you.

Thank you.

Thank you.

Thank you, Councilor Carney.

Councilor Oliver, on your first.

Thank you, Mr.

Chair.

Thank you, uh, Josh, for being here.

Quickly, again, uh, just to reiterate, uh, this property is generating zero tax dollars right now, correct?

That's correct.

Okay.

Well, I should say the city has recently started to impose taxes on it.

But, but yes, but still, in the amount of the— since this property's inception, when it was like, we've pretty much gotten nothing out of it.

That's correct.

Just recently.

Okay.

So though it's starting to contribute now, historically it has not.

So we still haven't seen a significant amount of revenue coming in from that property in its approximately 110 years of existence.

It may have paid under $10,000 in Tax.

Okay.

What is the likelihood of a project like this in this market getting shovel ready or being ready without a TIE agreement?

Very low.

Yeah.

Not, not impossible.

But our standing policy is that we don't bring projects forward for TIE agreements or through this process if they have another path to being viable.

So this is a scarce resource.

We only get 2 bites a year at the apple.

And so we, we don't take swings on projects that would work without it.

So there's often no backup plan.

And I mean, it may be a question for, for the developer, but I'm sure in your communication with them and the extent of how many projects like this have they done roughly?

I don't need an exact number.

Do you remember?

I couldn't tell you, but, but several.

Okay.

The— if we were to shorten the duration, right, there's still a match that we have to achieve, right, as far as taxable credits for them to get their financing, correct?

So even lessening it, we still have to match— we still have to get to that dollar amount, correct?

The minimum— yes, the minimum, uh, tie agreement, uh, under the law is 5 years.

The maximum is 20 years.

The, the challenge to making the agreement, say, 5 years is that this is a competitive process.

And one of the factors that the state weighs in where to allocate their tax credits is how serious the municipality is about supporting that project.

And so if we had a 20-year agreement where we have waived all of the taxes for the entire 20 years, not all of the taxes, but all of the improvement value taxes, they would say that is like like the maximum you could support this project.

If you have a 5-year agreement, that's 20% a year, which is the minimum— or 10% a year, I'm sorry, is the minimum.

They would say, you know, you really don't support this at all.

You're trying to take advantage of the state resource without it.

So we try to stay in the middle of that.

Frankly, the tax savings is immaterial to the developer, right, because it's going to be achieved by the residents.

But the tax credits, the $2.5 million from the state, is really what the developer needs.

And the 10-year— I know you said, you know, 5 being minimal, 20— is 10-year kind of the sweet spot for something like this?

Is that kind of the industry standard, or is it just— does it vary project to project?

Yeah, our sort of like standard off-the-shelf agreement is a 10-year agreement that's graduated 10% a year.

In some cases, when a developer has shown to us that there's a financial need to go beyond that, we've adjusted those numbers or like the intensity of those numbers in certain years.

But that's our, that's our standard agreement.

And though, you know, 44 units is, you know, is great, obviously it's still far below the number that we need.

But this is an alternative to homeownership, is it not?

Is it?

It is homeownership.

Well, I'm just like, but the conventional— yep.

You know, picture windows with the, you know, white picket fence.

This is bridging the gap from, you know, single-family housing and rental agreements, correct?

We're excited about the project because New Bedford doesn't have much of a condominium market.

Historically, my belief is that's because the top of the market rents and the cost to have entry-level, like, starter home mortgage were basically the same.

So top of the market renters were opting to rent because they didn't want to own a home.

But as homeownership has gotten more expensive, that gap has grown.

So now there's, I don't know, over $1,000 a month difference between top-of-the-market rents and, like, a starter home to a first-time homebuyer.

And so we think that in that $1,000 is money where someone might pay $200 more a month for a condominium that they'll own and build equity in rather than rent that same unit.

And I think that's proof of concept that would play itself out with this project.

Awesome.

Thank you very much.

Thank you, Josh.

Thank you, Mr.

Chair.

I yield.

Thank you, Council Oliver.

Council Baptiste, you're first.

Thank you, Mr.

Chair.

How you doing, Josh?

How's everything today?

Good.

How are you?

Good.

It still baffles me just having my kids go to that school and think of 44 units in that small little space.

That's first and foremost.

But with the tie agreements, the thing that I, that I that I, that I worry about sometimes is every time there's a project that comes in here, it's very important that we get the tie-out and we have to do it in a certain amount of time.

And we're always giving away, you know, 10-year ties, you know, at the same rate.

You know, some places do 20, some places do 5, depending on the project and the municipality.

How much of a benefit is it for us if we continuously keep on giving developers that come in here that make money on all these units and charge market rates, if we keep on giving them 10-year ties and they're getting tax breaks for everything that they're doing and all the money that they're making.

So it seems like every developer that comes in here that's trying to build 44 units, 50 units, 60 units is looking for a tax break and they're always getting a 10-year tax break.

So how How much is it helping the residents of the city by giving them continuous tax breaks?

Well, a couple of answers to your question, and I understand the gist of the comment.

A small percentage of developments in the city have sought TAI agreements.

So it isn't all of them or most of them or half of them.

But— well, the ones that come through here.

Yeah, that's enough for me.

In the case of this project, Right.

We project that the city will collect $389,000 more in tax revenue over the 10 years than it would if the project were not to proceed.

There is a savings to the, to the developer, the owners of the condos in this case, of $230,000.

So the, the value proposition to the city is, in effect, if you give an exemption on $230,000, you collect $389,000 you wouldn't otherwise ever see.

And so I think without a housing development proposal at this building, it's likely that this building will remain vacant and will continue to pay minimal taxes.

And I understand we need that.

But how about if we shorten it?

If we shorten it, right, and we shorten the amount of time that he can get it for the break, say 5 years instead of 10 years, what is he risking losing?

By the, the difference between 5 and 10 years?

Because I know that him paying more for the 5 years and saving more for the 10 years, he's going to make more revenue over the 10 years than the 5 years.

So what would be the gap in revenue that he would make between the 5 and 10 years that would make it so significant that he has to do it for 10 years and not 5?

Well, so to be clear, in this case, the developer receives none of the benefit of the tax increment exemption.

But you still make money though.

So when you get tax exempt, right, you're still saving.

The developer will sell every one of the 44 units and will not pay these taxes.

The owners of those units will pay the taxes.

However, how will that affect them if it changes?

They will, they will pay slightly less.

Like, say the tax bill on your condominium would be $2,500 a year.

It might be $2,300 a year if you are in a you know, for the duration of the tie agreement.

But I didn't mean to cut you off.

Go ahead.

Yeah, but to your, to your point, right, a 5-year agreement or a 7-year agreement is better than no agreement tonight, right?

So if the council wanted to proceed in that direction, I would take that.

Uh, the, the problem is Mr. Vanko's project is competing against probably a dozen or so other projects in the state, and one of the factors in that competition is how much that municipality has expressed financial support for that project.

And so at a 10-year term, on the, the, the terms that the TIF board has endorsed, I think we're in a competitive position.

If the project is a 5-year term or a 7-year term, it's a less competitive position.

It's not to say the project will or won't be funded, but it would hurt our chances.

All right, I yield the floor.

Thank you.

Thank you, Councilor Baptiste.

Councilor Roy, you're first.

Thank you, Mr.

Chair.

Hi, Josh, how are you today?

I'm good, how are you?

I'm great.

Um, just a couple questions.

Uh, what's the difference?

You said it's $385,000 the TIE is worth, basically, right?

Uh, $389,000 would be the amount of tax revenue the city collects that it would not otherwise collect.

So the math there is right now the city values this building as an assessed value on the building of about $3.5 million.

We think that these improvements will be about $5 million in valuation, and post-construction, the building will be worth about $8.5 million.

So the way we calculate those numbers is we look at what the tax bill is on the $3.5 base value, existing value, and then we look at what the tax value would be after you do $5 million worth of improvement.

And so then we kind of split the difference on the $5 million.

So if the current tax bill, just for the sake of discussion, is is, um, just for the sake of discussion, let's say it's $25,000 a year, um, and then you add $5 million of work to it, that tax bill might go to $100,000 a year.

And so the $25,000 is constant.

What we're talking about is how to split that $75,000 new value for the duration of 10 years.

And the numbers are approximate though, right?

So those numbers are very approximate.

So I mean, how can we be sure that this is the actual know, savings.

Well, there's a lot of moving factors to tax rate, valuation, etc.

I guess what I'm looking for, Josh, is, is, is, is just a simple, hey, we're giving this 10-year tieaway, right?

And I, I want to know, like, what it's— what the city— what the city is going to lose in $230,000.

What would they lose if it was a 5-year agreement?

If the project doesn't receive state tax credits, $2.5 million, it may not proceed.

So, so instead of, instead of, you know, submitting a 10-year tie agreement, say we opted for a 5-year tie agreement because this is, this is a, this is, you know, the city's effort into, into, into trying to build more housing.

So what, so if it's, what would that, the numbers, like just tell me the numbers, like, you know, it's $250,000 for the 10.

What is it for the 5?

What is it for the 7?

Let's just say it would cut those numbers in half.

Okay.

Right.

But the, the, the wild card is the project may never happen because the project won't be awarded tax credits.

And on that point, what do other municipalities do, you know, with their TAI agreements?

Have you done the research yet to find out what exactly is competitive?

Yes, I'm sure you have.

It's like, no, no, no, no.

We want the— we want the council and the public to be, you know, aware of all these factors.

We don't know what the projects that this project is up against might have.

Right.

We know that across the state there is a range of, of tie agreement structures that municipalities do.

Some communities default to 20 years.

Some communities do 5 years, 7 years, 10 years.

I think most do what we do, which is look at what the need is for that project to move forward and then structure it accordingly.

Most start at the 10-year mark.

So we've had explicit conversations with the state folks that have said For, I'll say, 2 years ago, there was an influx of money into this program, and so they funded more projects than ever.

Yes.

So historically, HDIP was a $10 million a year program.

A couple years ago, in the tax reform bill that Governor Healey passed, the $10 million expanded to $30 million, but they also created a $57 million fund to fund all the projects that had been like kind of stuck.

And so the funds were plentiful, projects were moving out the door.

Now we've moved back to the standard amount.

There's no $57 million fund to help get things over the hump.

And the instruction that we've gotten and what we've seen in practice is municipalities who are basically just doing the TIE agreements to say that there is one are not getting those projects funded.

And, and, and, and that would be like the minimum?

Yes, a 5-year one.

Yep.

All right, um, moving on.

The difference between this TAI is the tax incentive is going to the, um, the potential owners of the units, right?

Instead of the developer.

Have we ever done a TAI like that before?

No, first time we've done one for an ownership project.

Um, how can we stipulate— I probably probably can't, but do we expect New Bedford residents moving into these new condos, or do we expect, like, you know, more folks coming from out of town buying these condos because of the tax incentives?

Maybe they're, you know, better off financially.

What do you expect, like, as far as, you know, who would fill up the building?

I expect they will be New Bedford residents primarily, perhaps not exclusively, but I think, like, primarily, you know, Like 75%, 50%?

If I were estimating who I think make up the condo market, I would say about 75%, but I would defer to Mr. Vanko, who could talk to you about his plans to sell the units and how he might consider that.

All right, thanks, Josh.

Thank you.

Thanks.

Thank you, Councilor Roy.

I also want to welcome Councilor Lodge, Brian K. Gomes.

Anyone else on their first?

Seeing no one on their first, Councilor Carney on your second.

Okay, what was that?

Well, could you give me the, the total amount of taxes Was that $389,000 over the 10 years or a year?

It's over the 10 years, right?

10 years is what I calculate the city would receive.

Over 10 years.

So the city would receive over 10 years $389,000.

More than it would if the project were not to happen.

What is the— okay.

This building pays taxes right now every year.

Right, right.

Well, it should be paying— they're only exempt, Catholics.

That's when we looked at the churches and were only exempt for 3 years.

After that, it's not exempt now, is my understanding.

What?

The building is not exempt?

No, no, no.

I'm saying Catholic schools and Catholic churches, it's only 3 years.

After that, the diocese has to pay the city and state taxes, right?

You know, so what you had said, so you're only talking $389,000.

That's the benefit.

That's $389,000 over 10 years more to the city.

More to the city?

Yes.

Over 10 years?

Yes.

So divided, that is $38,910, right?

It's not— so that's 30— what did you say, $38,000?

$38,910.

So, so the city is going to be making $38,000 more per year on, on that building.

See, it's— I see where you're coming from about this, that they need this.

What other— you said that we gave somebody else— who did we give the TIE agreement to?

Another— we've done a few of them.

We did the housing on Commercial Street above the National Club.

We've done the Keystone site on Union Street.

We've done the Kudo Nursing Home.

We've done the project at the bottom of Elm and North Water Street, Elmwater Landing, that we cut the ribbon on recently.

Recently, right?

But how much was— what was that?

Those were 10 years?

Uh, the Keystone site was 20.

The others were 10.

The others were 10.

And were they the same?

That was— but those aren't condos, so those weren't going to the homeowners.

That was going to the developer who is building the thing so they could, instead of spending X amount of dollars— I, I just— the only hard time I have is giving it to a homeowner when we have homeowners all over?

That, that's, that's, that's the— if I understand your difficulty with it, what I would say is my difficulty with it.

So I would rather see if we could, if we can move it down to 5 years, I'd be, I'd be— I just, with, um, we did the math on the $38,000 a year for the city, the savings to the residents of the building Our $230,000 over that term, which is $23,000 to the building divided by the 44 units, is a relatively small amount of money per unit in savings.

And look, I think it's the nature of the beast to do tax benefits and tax exemption deals in ways that often the profits of the project go to the developer.

With respect to Mr. Vanko, we support his project wholeheartedly.

I would rather see the tax benefits go to the owners of condominiums than to the developer.

Oh, yeah.

Oh, I totally agree.

But if you agree, then you would support this.

I said I totally agree that going to an individual— my angst right now is we just raised the taxes on people.

I just got my new tax bill.

So does everybody else in the city.

Nobody's getting a tax break in this city who has been putting their blood, sweat, and tears into the city.

City, and now we're going to give it to people walking in purchasing a home.

So condominium's a home.

I was in a condominium, but it was, it was, it was my mortgage.

It was a home, even though then you have to pay your condo fees on top of that.

But that was— that's what I'm seeing, is that we got these people walking in, you're giving them breaks on their property taxes, and my guys are not getting breaks at all.

In fact, they're not happy with the rising of their taxes right now.

I, I completely understand, and it might be bad timing that we're before you to think about it that way, but ultimately, if the project doesn't proceed, though it is just $38,000, $39,000 a year the city will receive, that is money that those taxpayers will have their bills reduced by, you know, $2 a property or whatever that may be.

It's more money coming into the city that we might not otherwise get.

And so I would ask the council for their support.

Thank you.

Thank you.

Seeing no one else on the first I'll say— hold on, we still have council, uh, and we still have Mr. Amaral, if you don't mind, from the chair.

So Josh, simple, simple, quick yes or nos, don't need detailed analysis.

Right now, before this developer bought it, we were paying no tax— no taxes were paid on this property for 110 years.

Yes, correct.

We have a developer that's willing to buy the property, put it back on the tax rolls, and pay the city a value greater than what we're getting today, correct?

Yes.

Correct.

This is the first time we're having a development that's going to get tax incentives that doesn't benefit the developer.

It benefits the potential asset holder, i.e., the condo owner, correct?

Yes.

100% of the benefit goes to the resident, not the developer, correct?

Yes.

The state has limited amount of money to do these programs, correct?

Yes.

Additionally, understanding how this program works, there's two— there used to be two times a year, every 6 months, that you could apply for funding.

From the state for these programs, correct?

There used to be 3.

There's 2.

Okay, so 3, and now it's down to 2.

If you miss the funding requirement, it's automatically a knock the next time it's reapplied, correct?

Yes.

And we have other projects because I remember we had this issue with Dwayne Jackson prior to you serving in this role.

So additionally, we're now making the city more marketable to developers that want to build condos when we've had a lack of condo development, which is easier access for ownership normally at a third to two-thirds value depreciation compared to buying a house right now in the city of Everett that is averaging over $472,000, correct?

Correct.

So even if the higher end of the market, it is two-thirds less than somebody buying a pseudo, pseudo quote starter home, at least.

Yeah, correct.

If somebody was to buy a starter home at $430,000 or $470,000, they get no tax benefit, correct?

That's correct.

So we're allowing people to move into the city.

We're allowing developers a new opportunity to engage and repurpose older properties that have a higher, substantially higher cost to rehab because it costs more money to rehab than it builds brand new, correct?

Yes.

I'd add, though, that we think the vast majority of people who will reside here won't be moving into the city.

They're here now.

No, I'm just saying if somebody— so yes, there's not a lot of negatives in a project doing like this.

There's actually more positives, and it allows for the city to take a property that had been off the rolls and bring it back on the rolls.

And the increase in tax revenue is, from my simple math in my head, 68% increase versus what we're giving back.

So $231,000 to $381,000.

It's a plus in the city's favor of about 68%, correct?

Don't tell Mr. Vanko, but I think it's the, the least generous tie agreement we've brought forward.

Understanding that the benefit is to the city, the default on this project— and we put XI, a $5 million redevelopment project in the city— increases the tax rates from $3 million to $8 million, correct?

Correct.

Thank you.

Thank you.

Anyone else have any questions?

For Mr. Amaral?

Seeing none, Councilor Abril, you're first for Mr. Vanko.

Thank you, Mr.

Chair.

Mr. Vanko.

Good evening, sir.

Good evening.

I'd ask a question of Director Amaral, but I think you would be better equipped to answer it.

Talk about other similar reuse projects analogous to this that you've already done, and tell us a little bit about, you know, how that worked out and kind of how that all sort of shook out for you.

Sure, uh, 25 years of track record here for me as an architect and in a development role.

This is our 4th purchase from the diocese that has converted either a church or a school.

Large part of my practice is adaptive reuse, so we do all types of changing of nursing homes that we've, we've picked up and have done condo projects.

We do a lot of these types of adaptive reuses.

So it's right up our alley.

And this one's a great one in the fact that it's such a valuable building.

The building's beautiful.

It's in incredible shape.

And it's definitely one that's worth preserving.

If you've seen the plans at all, maybe you haven't, I'll just do a brief summary here in that we're really not having to do a lot.

It's such a wonderful building on the inside that we're maintaining a lot of the character and the typology of the building.

Yeah.

Okay, great.

Thank you.

Um, uh, assuming— and again, you never want to assume— but say you were to go forward this evening and to go forward in the process with this body, uh, do you have a construction timeline?

How does that look?

We are shovel ready.

We have a building permit issued by the city.

We are fully financed on the— we have our senior debt in place.

That was my next question.

Okay, good.

Yep.

Yeah, absolutely.

And, um, We have a seller who is distressed and really wants to sell the building badly to us.

So that's— we're ready to go now.

My partner is the GC on the project, of whom we have delivered roughly, to answer somewhat of your former question as well, we've delivered around 500, 550 units.

You said your partner is the GC?

My partner is the GC.

And the name of the company is?

Yeah, Broadway Capital.

Okay, so they are secondary to us.

Yeah.

What about some of the subs?

Do you have a preference?

And I would hope you'd want to keep the sub work locally and New Bedford-based.

And indeed, yeah.

What about union work?

Do you support union labor?

Certainly.

We've reached out.

So we actually have a local civil contractor on board already, Circle Earth, who is signed up for the project.

And they certainly have their New Bedford base, and we certainly have connections.

They have connections locally with those labor markets.

Absolutely.

Good.

Well, that's all good to hear.

Yeah, absolutely.

Thank you for your willingness to want to support local in this whole process as well.

Thank you.

Absolutely.

Love New Bedford.

It's, it's absolutely amazing.

I appreciate you being here.

Thank you, Mr.

Chair.

All yours.

Councilor Abreu.

Councilor Ryan, you're first.

Thanks, Mr.

Chair.

Hi, Peter.

How are you?

Great to see you.

Just a question similar.

To the question I had for Director Amaral.

Um, we would like— I mean, me personally, and I don't want to speak for everybody on the council, but I'm sure they agree— um, if we're going to give tax incentives out to folks buying condos or first-time homebuyers, we'd probably like to give them out to the folks who grew up in the city, live in the city now, um, versus, you know, folks that are coming in.

Indeed.

Can you give us any assurances to how you'll market the units to New Bedford residents?

Yeah, I mean, it really is— we would much rather see people who— well, I'll tell you who the building is really being built for.

Ideally, it's that first-time homebuyer, that person who wants to exit the rent cycle.

Ideally, it's someone who is starting out.

If they're not a first-time homebuyer, maybe they're actually downsizing.

It could be on the back end of someone's life.

They're exiting a single family.

All their children live here in the, in the area.

They want to be here, but they go to Florida for 6 months out of the year.

This is a great way for them to get one of these units and be able to have that, that lifestyle, but still stay local.

Our marketing team for the sales will be local without a doubt.

So that's where we will push first and foremost.

Right now we're selling out 18 units also in a diocese building.

In Fall River.

And I would say Joshua's exactly right, about 75-25.

75% were local.

That building happened to be— had affordability as a component of it as well.

So, but that's what we've seen even with the extension of the train lines coming down.

Certainly there were market pressures, people coming down from Boston.

They're saying, okay, hey, I can move down to New Bedford.

I also think that's a net positive.

Personally, you're still getting a unit, you're still getting vibrancy, you're still getting all of— you're getting a new resident.

So, you know, I think that's a net positive.

But overall, it's a marketing issue, right?

On that, you, in your developments, you've done leasing as well instead of as well as, uh, no, I typically am always doing condos.

Okay.

Yeah, I believe deeply in homeownership.

Um, I haven't wanted to— all my rentals have, um, I've always switched them over to condos.

Yeah.

All right, thank you, Peter.

Thank you, Mr.

Chair.

Thank you, Councilor Roy.

Anyone else on the first?

Councilor Carney on your first, and then Councilor Oliver.

Thank you.

So, um, so once you get the property and you apply for the HDIP, if you don't get the HDIP because it's a competitive market and there's only a couple out there, then what?

What do you— what happens if you don't get the HDIP?

Yeah, well, so our, our seller is wanting to close tomorrow if we could, and we have our senior debt in place.

We have an equity chunk that we have raised, we put in place, but But our senior lender is willing to bridge that.

So the— essentially getting rid of having to go to private equity or do bridge loans or anything like that, which is very expensive money, it helps us be able to put that back because we're saving on that bridge loan.

We're able to put that back into the project.

And as it's been stated previously, this really benefits the end user, the end buyer.

Right.

But I'm saying if you don't get the— yeah, are you going to proceed with the project or is it over?

Yeah, well, we have difficulty certainly in getting to closing without, without HDIF because our lender is actually placing dependency on these bridge funds on, on obtaining HDIF.

So what if you— if you— if you reapprove this, you go there, it's a no?

Then what?

Will you still proceed with the project or is it done?

Is your lender going to let you proceed with the project and extend your loan over X amount of years?

Or is this, is this a done deal?

You know, it's, it's, it makes it a lot harder without it.

Yeah.

So would you proceed or will you not proceed?

I'll talk to my partner on it.

But it is, it's definitely, it makes it, it makes the go/no-go a much, a much, much harder decision.

Right.

Like Director Amrell said, it's a very competitive process up there with the HSTIP.

It's extremely— it's worth going for.

Right.

I mean, it's worth going for, but it's very competitive.

I'm just wondering, if you didn't get it, would you proceed with this project in other ways if you didn't get the HSTIP?

That's a great question.

We'd probably have to go to a Plan B.

Which Plan B is, um, maybe less viable, but we just have to explore that at that time.

Okay.

Um, yeah, because my— both my kids went to Holy Family.

My son was there at preschool and all the way to 8th grade.

Now they can live there.

I've been there.

We went there to get all the pickings when they opened the doors and let us in.

So, um, so, um, okay.

Um, the other question I have is Once, once you purchase a property, um, are you responsible for the taxes until— we are— until you're up and running?

We are.

And if you don't, and if you don't, um, fill up the, the units in a year or a year or so, yeah, you're responsible for the— so we are— you're responsible for the entire taxes until they purchase the units and then they get the That's correct.

So do you get the, um, you get the little break off those units if, um, you don't fill them up?

That's a great question because you're giving it to the homeowner and there's no homeowner and you're sitting there for a year and you haven't filled them up and you got half of them open.

Yeah.

Who pays the taxes or do you get the break?

We still are paying the taxes.

Right.

But do you get the break, the incentive on that unit?

I would imagine so.

I would imagine so.

Um, but it is, uh, doesn't change anything in regard to the TIE agreement.

The city still is getting exactly the same amount from a tax perspective.

It's just coming from a different entity.

Okay.

I really don't want to be in that, in that position of having to— I hope they're all sold.

That's really our, our goal.

And that is also one of the things I, I can tell you after selling a lot of condos One of the biggest fears of a developer is to be stuck with units at the end of the day, especially when you're taking a chance.

So from my perspective, and it obviously is less of a skin-in-the-game issue for me as it is the city, it— but that having that extra 10 years of graduated tax abatement really helps.

It helps my— it helps buyers take the chance on New Bedford too, in terms of, in terms of doing a condo, New Bedford, taking it, taking a chance.

They're already here.

Yeah, hopefully, hopefully so.

But taking a chance on New Bedford, but buying in though and really committing.

Yeah.

To saying, hey, this is really where I'm going to stay for a long time versus a renter who could leave, can go to a different municipality.

When you actually have someone who's committing long-term to a unit like this, they really have bought into the community for a much longer period of time.

Oh, I totally agree with the condominium aspect.

I totally agree with the condominium aspect, and I think there should be more homeownership in condominiums.

I mean, my first home was a condominium in Fairhaven.

You have to, you know, you got to pay your condo fees, but I do believe in that.

I think that's a good way for a family or an individual that wants to have ownership to start.

So I, I have nothing against that.

I'm just— you, you heard what my concerns are.

Yeah.

So that was the only thing.

But I was just wondering about that, the whole tax thing.

But I'm good.

Thank you so much.

Sure.

What you said, the project— how many other projects?

You said one in Fall River.

Where's the other ones?

Oh, we've purchased 4 buildings from the diocese in in the last 5 years tend to focus on gateway cities.

So one is Fall River.

One's Fall River.

The other 2 in Chelsea.

Could you tell us the Fall River Diocese building that you purchased?

403 Division Street.

Okay.

Yeah.

Is it a church, a school?

It was a school.

It was a school.

Yeah.

Actually very, very similar to this one.

Yeah.

Not in very good shape.

Okay.

Is it up and running now?

They're up and running and the condos are being sold and everybody's happy.

And that's what, a 203 division?

Completely done.

Okay.

Yeah.

All right.

And the ones in Chelsea?

Yeah, there are 2 in Chelsea that have— one was a church at 242 Washington.

That is all done.

And the other is I can't think of the address.

There's a nursing home that we did, 932 Broadway in Chelsea.

That was a 40— that was a 40-unit conversion.

Right around that, there's— you've had 4 of them.

I just wanted to go by and look at the Fall River one, the closest.

Oh yeah, good.

403 Division Street is looking good, and that is selling out currently right now.

Okay, super.

Thank you.

Yeah, sure.

That one's the most local.

Yes.

Thank you so much.

Sure.

Thank you, Councilor Carney.

Councilor Oliver, on your first.

Thank you, Mr.

Chair.

Thank you for being here and looking to invest in the city.

The councilor who spoke before me was kind of going down the path of my line of question is just, um, um, do you start marketing right away when you get— We do.

It's okay.

Yeah, pre-sales.

We will try to be— try to get as many presales as we can.

And have you been fairly successful with that, with these type of projects?

Oh, very.

And you said that the other projects have been or are currently selling or have sold.

How long has it been from— how long has that kind of taken you from the shovel in the ground to getting the last unit sold?

What's that timeframe average for you guys?

Yeah, depends on the depth of the renovation.

This, we have a 12-month construction schedule planned because we're not having to do a tremendous amount of renovation.

There is an alternate, there's a change, but in other renovations we built whole additions on top of buildings.

We've had to take, make holes in buildings.

We're not having to do quite the same things here.

So 12 months.

Shovel in the ground to construction finish.

Ideally, I'd love to be selling out at the end of that, that 12-month construction process.

Realistically, it's probably maybe we're selling the last one 4 to 6 months after the certificate of occupancy is issued.

That'd be the goal.

The goal would really be to be completely sold out.

As soon as we're finishing.

Have you had that happen yet in any other projects?

We have.

So we've done a few interesting things where we do a model unit.

So that allows potential buyers to come see a unit almost from, almost from the inception of construction.

We've even done it in a construction trailer.

We built a model unit with the bathroom, everything that you will see here.

Our goal is to— we have we're going to do 2 units right off the bat.

One is a model unit, and the second unit there would be for our superintendent to actually stay.

So we'd be using it for our construction, full-time construction team who's really running the job.

And, uh, not that it has any bearing on the decision, just so I know and maybe the general public knows, uh, would this be like pre-sales or anything like that?

Are people going to have the option to customize their units while it's being built, or do you guys just have, this is what we're doing, cookie cutter, figure it out after you own it?

Yeah, great question.

So certainly we will offer upgrades.

Certainly if someone comes to us and says, hey, we want to buy a unit, but we just don't really care for that tile.

Sure.

Yeah.

Yeah.

Well, thank you.

Good luck with, with the whole process.

Thank you.

Excellent.

Thank you so much.

Thank you, Council Oliver.

Anybody have any other questions?

Councilor Gomes, on your first.

Thank you, Mr. Chairman.

I don't really have a question for you, Peter.

We met some time ago.

I'm most impressed with your project.

I've looked at your project in Fall River.

Thank you.

I don't— I'm just having a brief discussion with Josh.

There's no failure with you.

You don't even have that word in your vocabulary or in the construction or anything.

And that has been very impressive by this councilor.

And for my colleagues to know, if you haven't seen this project or know what you have— are going to put in this project, is one that I feel is going to be a model in this city for other developers as they come along, or what we look for a developer when it comes to condos or whatever to do.

You've worked with the neighborhood, the parking, the landscaping.

It's just phenomenal.

And I think you're You're a great fit for the city of New Bedford, and I hope this won't be your last project.

And good luck.

That's all I basically wanted to say.

And that's because of our interactions already and getting to know what— know you and know about your company and your associates and how you do business.

You're top-notch, and you're not going to give anything less to the city of New Bedford than a top-notch project.

Thank you very much for that, sir.

Indeed, Councilor.

Thank you so much.

Thank you, Mr. Chairman.

Thank you, Councilor Gomez.

Anyone else on the questions?

Seeing none, what is the choice of the committee?

Motion of referral to the full City Council for adoption.

Made by Councilor Burgo.

Second by Councilor Abreu.

All those in favor?

Opposed?

The ayes have it.

Motion to adjourn made by Councilor Burgo.

Second by Councilor Abreu.

All those in favor?

Opposed?

We are adjourned at 7:58 PM.

Thank you all.

August 20th.

Okay, excellent.

Thank you so much.