A major development project in downtown Springfield, Massachusetts can move forward now that City Councilors have agreed to a financial bailout.
At a special meeting at noon Friday, the City Council by a vote of 10-2 authorized the use of $6.5 million from the city’s free cash account for the project to restore the historic former Court Square Hotel building and develop 74 apartments with commercial space on the ground floor.
MassHousing, the state’s quasi-public housing development agency, will also kick in $6.5 million to close the funding gap for what is now a $64 million project. Skyrocketing costs for construction materials including steel, aluminum, and glass are blamed for wrecking the project’s original budget that was set just last summer.
Several Councilors who voted for the finance order, including Council President Marcus Williams, said they were angry that the administration of Mayor Domenic Sarno had known of the financing shortfall since at least January, but Councilors were kept in the dark until last week when the private developers threatened to walk away from the project unless the city committed to provide the additional money right away.
“I would appreciate more respect when it comes to turning these type of significant projects for the city around and I think my colleagues would as well,” Williams said.
Councilor Kateri Walsh, who said she was undecided right up until the rollcall and she voted “yes”, said she was “offended and disgruntled” by the Council being given an ultimatum.
“ ‘If you don’t vote for it, it’s your fault, Court Square is going down the tubes because the City Council didn’t act’,” Walsh said. “There is something very very wrong with the way this has been done.”
The urgency to get the project fully-funded so that construction work can begin is a result of the rapid deterioration of the six-story, block-long building that has been vacant for 30 years, said Springfield’s chief development officer Tim Sheehan.
“As the structural integrity becomes more and more compromised, the associated risk and liability grows for the SRA (Springfield Redevelopment Authority) and the city,” Sheehan warned.
Redeveloping the long vacant building has been identified by urban planners as a catalyst to spur more economic growth in the metro center.
Last summer, the co-developers WinnCompanies of Boston and OPAL Real Estate Group of Springfield announced they had secured financing from nine public and private entities. MGM is putting in $16 million to satisfy its casino host community agreement to develop housing downtown. The project is also getting historic redevelopment tax credits.
The two Councilors who voted against transferring the free cash to the project – Trayce Whitfield, who chairs the Finance Committee, and Justin Hurst -- called it a give-a-way to millionaires.
“So, either folks are for the people who are struggling to make ends meet or they’re for big-time developers,” said Hurst.
The project will employ about 500 union construction workers.
Several Councilors said they’d received numerous calls this week from people in the building trades urging them to vote for the funding.
