Chelsea Council Approves 20-Year TIF for FBI Building

January 29, 2017
By

By Seth Daniel

In one of the most difficult decisions faced by the Chelsea City Council in some years, the board voted Monday night 7-3 to allow a 20-year Tax Increment Financing (TIF) agreement for the developers of the FBI Building, ACS Development.

The TIF was one of the largest ever granted by the City in terms of time length, and also in terms of raw dollars, on one of the most valuable buildings ever constructed in the city – the recently completed $58 million FBI Headquarters Building on Everett Avenue. At the same time, the TIF request came at a time when taxes have just gone up substantially on many homeowners in the city who are faced with rising property values, and renters who are faced with steep increases in rents. Those two facts set the stage for showdown of viewpoints as disenchanted taxpayers cried corporate welfare, and ACS Development asked for loyalty in exchange for their many years in the city and help in what has become a tough financial situation for the company – as the development of the building went through many costly legal proceedings.

The taxes with the TIF would start out at $870,000, and without the TIF they would start at $1.739 million. The percentages would equal out to a 50 percent break on the total value of the project for 15 years, and a 40 percent break for the final five years.

On Monday night, it was loyalty to a long-time friend of the city that carried the day – with a majority of the Council voting to allow City Manager Tom Ambrosino to execute the agreement with ACS.

Those voting for the TIF were Councillors Luis Tejada, Giovanni Recupero, Matt Frank, Leo Robinson, Paul Murphy, Dan Cortell and Roy Avellaneda.

Those voting against were Damali Vidot, Yamir Rodriguez, and Enio Lopez.

Councillor Judith Garcia recused herself from the proceedings due to having won a scholarship from the Simbolis and having worked on parts of the project while at the company.

“Some 34 years ago I became acquainted with the people of Chelsea in a time when there wasn’t much here since it wasn’t too long after the fire,” said Anthony Simboli after the vote. “We sat right here in City Hall to begin talking about developing here. I’ve been laughed at for 25 years and people have asked me why I would ever come to Chelsea and develop…The answer is what happened tonight. There’s something special about the people of Chelsea. This Council proved it tonight by giving me their support. I know I made the right decision.”

Councillors and the public spent a great deal of time debating the issue starting in December. That continued into January, and also into Monday night’s meeting. Several residents in opposition made their voices known, and Economic Development Board Chair Rick Pantano made a plea in favor.

“The arm twisting over the last month doesn’t sit good with me,” said Maureen Cawley, referring to the presentation made by ACS about its many years of community involvement and benevolence. “If you’re going to do something good, then dot it…We’re not in a position to say, ‘Don’t worry about paying millions and millions in taxes. We’ll pick you up.’ We’re barely hanging on. Some are beyond just hanging on. Some are displaced.”

Said Pantano, “An extremely important part is ACS is committed to the long term. ACS is not here to come in, make a quick buck and leave.”

Councillors also gave their reasons for supporting the measure.

That started with Councillor Dan Cortell, who represents the Everett Avenue area where the FBI building is located. He said when he first came on the Council eight years ago, there was only the Wyndham Hotel in the area, and all else was vacant land collecting no taxes – including the FBI Building.

“There could be a commercial office building there worth $10 million and they would have not gotten a TIF and they would pay less taxes they they would pay for the FBI Building with the TIF,” he said. “For at least the next 20 years and hopefully much longer, we will be the Northeast base of the FBI. That’s meaningful, especially for a city with public safety issues. They were here. They are here now, and I want them to be here in the future.”

Councillor Matt Frank said the City needed to live up to its business obligations, and indicated he was voting for it.

“If you can’t trust the people you are working with, you should be working with them,” he said. “…Us not trying to work with this company or this developer would be our equivalent of saying we’re not going to honor our obligations…All of these things should be considered, but the main reason it should be considered is it helps the City…I have nothing to gain in voting for this.”

Vidot said she spent many hours considering the matter, and understood the necessity of working well with business, but in the end decided to vote according to the people.

“The very fiber of what makes Chelsea Chelsea is at risk of being displaced,” she said. “I can’t in my heart tell someone struggling with their property taxes or rent that I gave out a 20-year TIF. I am absolutely against that. We had a 15-year-old boy who died last week. He was killed. We keep asking for a youth center and we’re told there’s no money, no money, no money. The Simbolis could fund that several times over…I felt they did not demonstrate the need for financial assistance. I’m voting no.”

Councillor Giovanni Recupero said the problem for taxpayers is not a TIF, but instead is spending by the City. He said he was voting for the TIF.

“We are in the middle of something here,” he said. “Taxes are going up regardless. The only way to keep taxes down is to keep the spending down, not by not giving them a TIF. If you don’t give it to them, you won’t lose any money or you won’t gain any money…If you don’t develop, the people who live here are going to get kicked out even faster.”

Councillor Roy Avellaneda said it is important to remember the past, remember the barren land, and remember that it was the Simboli family that pioneered changing that into what it is today.

“I do look at the past because in my childhood I remember walking from my house to go to K-Mart,” he said. “ I had to walk through barren land to get to the mall. People forget what the City look like after the fire. I’m sorry, but you don’t remember. We are spoiled by what we see now…Boston got GE there by giving them a TIF. We have to entice business in our community with TIFs, whether they are for bakeries, hotels or an FBI Building. You give a give a TIF and get some money or you get no money. We’re choosing between $865,000 a year or zero. What choice would you make?”

He added that he asked for financial information from ACS, and after reviewing it, he said he is comfortable is their need for the TIF.

“Based on the numbers provided to me, it’s well below industry standards,” he said.

Council President Leo Robinson said he first met Anthony Simboli in the mid-1970s when he was trying to build housing on the site that had been ravaged by fire. He said over the years the Simbolis proved to be reputable and a good partner with the City.

“ACS Development’s patience in waiting for the right opportunity landed Chelsea the FBI Headquarters,” he said. “The contributions their firm has made to the City are recognized by many. ACS Development’s investment in our community by devoting its time and wisdom to several community boards, to fundraising for non-profits and most recently to our City’s youth, set s a strong example to other members of the business community.”

Councillor Enio Lopez said he would not support the measure because it went beyond 10 years.

“I have said I would vote against this if it’s 20 years,” he said. “If it were 10 years, ok, but not 20. I”m going against it.”

Councillor Luis Tejada also cited the numerous things the Simbolis have done for the community, including scholarships to Chelsea students, and said people must remember what it was like when he was a kid.

“We need to strengthen the buildings and the progress we’ve made so we don’t go back,” he said.


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