Concord residents question $3.5M in city funding for DES project

  • The former Department of Employment Security building on S. Main Street.

  • A rendering of Dol-Soul Properties’ most recent vision of what its Main Street apartment complex might look like. The view is from the corner of South Main and Fayette streets. Courtesy of City of Concord

Monitor staff
Published: 7/9/2019 6:05:10 PM

Concord officials are pitching a $3.5 million offer to help a developer bridge a funding gap for a mixed-use apartment building as another example of a public-private partnership.

But residents at Monday’s city council meeting said offering the money to Dol-Soul Properties, who is looking to redevelop the former state Department of Employment Security building on Main Street into a five-story structure with 125 apartments and a 5,000-square-foot retail space over a garage, is subsidizing a developer and not the best use of taxpayer dollars.

“It’s hardly a blighted district,” said Charlie Russell. “We don’t want to have to subsidize businesses to come here; businesses are coming here on their own. We don’t need to loan money to bring developers here.”

The city wants to use up to $3.5 million from its tax increment finance (TIF) district funds to help Dol-Soul bridge a $7 million funding gap for its project. It could be used to pay for on/off-site improvements, reducing the $1 million sale price, or cover other costs like building permits or impact fees.

Residents argued the perks were too rich and downtown is thriving without any added incentives after a multi-million dollar renovation and an influx of apartments in recent years.

Matt Walsh, deputy city manager of development, began his presentation with a history of the city’s use of TIF districts to create economic development in “blighted” areas developers otherwise wouldn’t touch.

Specifically, he mentioned places like the Smile building, the Horseshoe Pond business park, Eagle Square and Constitution Avenue as results of TIF development. Other places he cited as public-private partnerships were recipients of other tax relief programs offered under state law.

Resident Roy Schweiker said the comparison wasn’t accurate, saying the city has used its TIFs in the past invested only to build infrastructure, not help fund the actual project. He accused Walsh of comparing apples and oranges.

“We’re not just building roads and stuff ... I don’t think that’s a fair comparison at all,” Schweiker said, noting the city has already invested money into the project.

The city has already discounted the sales price by $500,000 and changing the city’s impact fees ordinance to allow a cap of $150,000. The city also used the DES building as a major part of its reasoning to bury two blocks of utility lines from Pleasant to Thompson Street to the tune of $2 million.

The developer had originally pitched a $23.4 million project when the city first agreed to sell the building. Nearly two years later, the project – and its budget – has grown, and the developer says they won’t be able to do the project if the gap isn’t bridged.

“We came in thinking we could make the economics work,” said Drew Dolben, executive vice president of The Dolben Company, one of the few companies that makeup Dol-Soul. “... We did a lot of due diligence, met several times with a design review committee ... at the end of that analysis what we came to is, we had designed a building that was more than what rents in Concord can support.”

Some residents had were concerned about the project itself.

“I think this is just too big,” said Ian Flanagan, an abutter who owns property on Fayette Street and said his tenants rely on the parking lot behind the DES building for business.

“Retaining those people when parking is gone is going to be very difficult,” he said.

Whereas other residents wondered how much more the city would be willing to offer to secure Dol-Soul’s participation.

“Anytime there’s a burp or a hiccup, it seems he’s asking for more dollars or support,” said Ron Raymer. “It’s time to cut bait and fish.”

The city council will vote on the measure next month, as state law requires a waiting period between a public hearing and a vote to change TIF district finance plans.

(Caitlin Andrews can be reached at 369-3309, candrews@cmonitor.com or on Twitter at @ActualCAndrews.)



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