, Gloucester, MA

November 14, 2012

Editorial: Grant rejection cannot halt Fort utility or hotel projects

Gloucester Daily Times

---- — It’s certainly disappointing to learn that the state’s MassWorks infrastructure program has turned thumbs down on Gloucester’s $5 million request for a grant to provided badly needed infrastructure improvements beneath the city’s historic Fort neighborhood.

And we hope that, as Mayor Carolyn Kirk suggested Tuesday, state Rep. Ann-Margaret Ferrante and state Sen. Bruce Tarr can press for answers as to why a project that’s obviously tied to, though not dependent upon, Gloucester’s most important development project in years somehow didn’t pass muster with one of the lead agencies of the state’s development and investment framework.

But it’s also good to hear that — while, yes, there are now questions as to how the city will cover the cost of all this – the mayor and Department of Public Works Director Mike Hale are committed to going forward with a project for which the engineering work is already underway. The reality is, improved underground infrastructure at the Fort has been overdue for decades, and remains so regardless of whether the planned Beauport Gloucester hotel ever becomes reality.

The ideal scenario for the city and its residents, of course, is that the hotel — sought and set to be developed by the Beauport Gloucester LLC firm headed by New Balance owner Jim Davis and Cruiseport Gloucester’s Sheree DeLorenzo — becomes very real and provides the kind of economic boost and jobs that the city certainly needs. And the hotel project, which remains in the permitting process and is pegged for the city’s new hotel overlay district covering the former Birdseye industrial site, has given a sense of urgency to the Fort infrastructure work.

Indeed, Hale was right to recognize the need to speed scheduling the reconstruction of pipes and other utility infrastructure beneath the Fort from an initial target date of 2015 up to 2012-13 once the hotel project came into play — recognizing it would make no sense to allow construction of a hotel, and then tear up the street and utilities again just two years later.

But it’s not as if the city is looking to dive headlong into the utility construction today or tomorrow, either. Hale said his department and contractors plan to have a design for the project ready by June, with a 25 percent design expected by Dec. 1. And all of that should give city officials time to sort out how to pay for the work before the actual construction begins.

There should be some options toward that goal. One could be to re-apply for some MassWorks funding, or seek some other form of state or federal aid – perhaps for a lesser amount than the initial $5 million. It’s telling that, if Gloucester had landed its $5 million MassWorks request, it would have reeled in 25 percent more than the $4 million awarded Haverhill for a street reconstruction project — and that was the most granted through any of the approved funding.

Another option, noted by Kirk, is the idea of working with Beauport Gloucester for a Tax Increment Financing program – though residents could understandably question whether a project aimed at generating significant new tax revenue and backed by Davis and New Balance should even remotely deserve a TIF consideration.

Kirk is also right to suggest that, if the hotel permits are granted in the weeks and months ahead, Beauport Gloucester can contribute more than the $600,000 it’s also signed over for the infrastructure work — regardless of whether the hotel is approved. Then there’s the city’s freshly certified $4.8 million free cash kitty — which, as we noted last week, is excessive and should be used to provided added funds for city services — should certainly be considered in play for an investment such as this.

The bottom line is that city has time to pursue funding options for this project, even as the project itself — and the permitting for the waterfront hotel — go forward.

The loss of the state grant is a bump in the road, not a stone wall — for the infrastructure work and hotel project alike.