RI State Trea­surer backs ball­park project

Trea­surer Seth Magaziner lat­est Rhode Is­land of­fi­cial to weigh in pos­i­tively on PawSox sta­dium

Woonsocket Call - - Blackstone Valley - By BREN­DAN McGAIR bm­c­gair@paw­tuck­et­times.com Fol­low Bren­dan McGair on Twit­ter @BWMcGair03

EAST GREEN­WICH – Af­ter care­ful study and re­search, Gen­eral Trea­surer Seth Magaziner told the Se­nate Fi­nance Com­mit­tee on Wed­nes­day night that he sup­ports the pro­posed Paw­tucket Red Sox ball­park.

“I will ad­mit, I ini­tially had some skep­ti­cism. But af­ter sev­eral weeks of re­view­ing the plan and meet­ing with city and team of­fi­cials and com­merce de­part­ment of­fi­cials, I be­lieve a ball­park at Slater Mill would be a win­win for our state,” Magaziner told the com­mit­tee, which staged the fourth in a se­ries of hear­ings on the New Eng­land In­sti­tute of Tech­nol­ogy cam­pus. “I be­lieve the plan is both af­ford­able for the state and the city. We should also be ex­cited about the prospect of re­de­vel­op­ing down­town Paw­tucket.”

The anal­y­sis done by Magaziner’s of­fice found that the state has the ca­pac­ity to is­sue roughly $1.2 bil­lion of new bonds over the next 10 years while re­main­ing within ac­cept­able bor­row­ing lim­its. As part of the same study, Paw­tucket’s level of in­debt­ed­ness is be­low the rec­om­mended lim­its based on cri­te­ria such as di­rect debt rel­a­tive to prop­erty level, to­tal debt rel­a­tive to prop­erty level, to­tal debt & pen­sion li­a­bil­ity to prop­erty level, and to­tal and pen­sion li­a­bil­ity rel­a­tive to per­sonal in­come.

“The real fi­nan­cial chal­lenge for Paw­tucket is not that the city has too much tra­di­tional bonded debt, but like many cities, Paw­tucket has to bring its pen­sion li­a­bil­ity un­der con­trol,” said Magaziner. “The an­swer to a strug­gling pen­sion plan should be to fix it, not to freeze all other in­vest­ments and ac­tiv­i­ties.”

While Magaziner sup­ports the $83-mil­lion PawSox ball­park plan as it’s been ex­plained to date, he feels the leg­is­la­tion as cur­rently writ­ten needs some tweaks. He said the bill is vague as to whether the state would guar­an­tee the Se­ries A and Se­ries C bonds if the team or city were un­able to meet those fi­nan­cial obli­ga­tions.

“If there were not a state guar­an­tee on th­ese bonds, the in­ter­est rates on them would be slightly higher,” said Magaziner. “If there were to be a state guar­an­tee, the in­ter­est cost to the city would be lower, but the state would be re­spon­si­ble for ful­fill­ing the obli­ga­tion if the city was un­able to.”

The gen­eral trea­surer’s of­fice es­ti­mated that the cost of in­ter­est to Paw­tucket for the Se­ries C bonds, in the ab­sence of a state guar­an­tee, would run be­tween $50,000 and $200,000 higher per year. Magaziner also ques­tioned whether the Paw­tucket Re­de­vel­op­ment Au­thor­ity is the best agency to is­sue all three se­ries of bonds.

“The ex­e­cu­tion and pric- ing of the deal might be more fa­vor­able if the bonds were is­sued through a more es­tab­lished agency,” said Magaziner.

Should the PawSox ball­park leg­is­la­tion get passed, Magaziner says it’s im­per­a­tive that the lease agree­ment be­tween the city, the state, and the team “con­tain ad­e­quate tax­payer pro­tec­tions and that the state be able to walk away if those pro­tec­tions are clearly not laid out.” The lease agree­ment also needs to be clear about who is re­spon­si­ble for the cost of on­go­ing main­te­nance and re­pairs over the 30-year life of the team’s agree­ment.

“If th­ese con­di­tions are met, I be­lieve this plan will be a pos­i­tive for our econ­omy and our qual­ity of life,” said Magaziner. “The PawSox are a valu­able Rhode Is­land in­sti­tu­tion and we owe it to work­ing fam­i­lies to sup­port fam­ily friendly recre­ation that’s af­ford­able.”

Ste­fan Pryor, the state’s com­merce sec­re­tary, out­lined six guid­ing prin­ci­ples dur­ing his pre­sen­ta­tion to the com­mit­tee. Of note, the PawSox own­ers with Rhode Is­land ties would pledge to do­nate their ball­club prof­its to char­ity for the first five years of the new ball­park.

“We be­lieve this is fair deal for tax­pay­ers and this frame­work is very sound and mer­its strong con­sid­er­a­tion for ad­vance­ment,” said Pryor.

Re­spond­ing to a ques­tion from Sen. Louis DiPalma about the PawSox com­pet­ing against, for ex­am­ple, the R.I. Con­ven­tion Cen­ter to host a non-base­ball event, Pryor said the in­ten­tion is not to play two sides against the mid­dle with one side of­fer­ing a re­duced rate. Hav­ing a quasi-state en­tity like the Con­ven­tion Cen­ter Au­thor­ity “is a worth­while sub­ject for dis­cus­sion,” said Pryor.

Pryor told the com­mit­tee that it would an­nu­ally cost $150,000 to main­tain the new PawSox ball­park. The team is seek­ing to share the cost with the state, but Rhode Is­land hasn’t agreed to that. The com­mit­tee said that fu­ture hear­ings must ad­dress that.

Michael Done­gan, an en­vi­ron­men­tal lawyer with Providence-based Or­son & Brusini, was en­gaged by the city of Paw­tucket in re­la­tion to en­vi­ron­men­tal con­di­tions about the Apex site. Done­gan ref­er­enced the Sage en­vi­ron­men­tal re­port that’s avail­able on paw­sox­hear­ings.com when asked by Sen. Wal­ter Fe­lag if it’s safe to dig on the prop­erty.

Pub­lic tes­ti­mony was sched­uled to start at 8 o’clock but didn’t com­mence un­til 8:45 due to sev­eral of the speak­ers run­ning long. Ato­tal of 25 speak­ers signed up but 19 ended up tes­ti­fy­ing.

The next Se­nate Fi­nance Com­mit­tee hear­ing is sched­uled for Thurs­day night at 6 o’clock at Roger Wil­liams.

Seth Magaziner

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