There are two schools of thought on the proposed multimillion dollar project at 34-38 Munroe Street.
One side agrees that while the city needs to borrow money, raise fees and increase taxes in order to close a budget shortfall—this is not the time to give a developer a tax-break incentive to get a market rate housing project off the ground may not be now.
The other side feels the $80-$90 million, mixed-use commercial and residential project will help jumpstart economic growth and bring viability to downtown Lynn and the city.
Despite these two opposing views the Lynn City Council voted 7 to 4 to award developer Oxford Residential Partners, LLC a tax break on the project as part of a Tax Increment Exemption Agreement or TIE.
The vote saw City Councilors Peter Capano, Brian LaPierre, Hong Net, and Jay Walsh voting against the measure with LaPierre saying he could not bring himself to “offer an incentive of that magnitude in the city’s difficult financial times”.
While City Councilor Dianna Chakoutis, whose ward the project is located, voted in favor of the TIE arguing that while the tax break would save the developer around $2.5 million in property taxes over seven years it would still bring in $5 million in additional taxes for teachers, the fire and police departments and street repairs for the city. Councilor Chakoutis said the $90 million investment in downtown is perhaps the biggest private investment in the city in the past half century.
The state’s TIE program allows Gateway Cities like Lynn to negotiate with private developers to provide them with tax incentives to develop housing while sparking economic growth.
The TIE, negotiated between Mayor Thomas McGee and Oxford Residential Partners, LLC, allows the city to fullt tax the commercial part of the mixed use development while gradually increasing the residential property tax over a seven year period. The residential property tax would begin at 15 percent of its assessed value starting in 2020 and then increase in increments until it reaches 100 percent of the assessed value. McGee’s office expects the tax revenue to be $1.35 million yearly after 2027.
The site on Munroe Street, that is currently being used as a community garden, would be transformed into a 10-story, 261-unit building with 20,000 square feet of ground floor commercial and restaurant space, according to Lynn Economic Development and Industrial Corporation Executive Director James Cowdell.
Echoing Councilor Chakoutis’s sentiment Cowdell called the vote to grant the TIE ‘historic’ and called the project a significant step that will greatly impact the economic future of the city by attracting more people to the downtown area.
Cowdell said a groundbreaking on the development is scheduled for either late 2018 or early 2019.
However, not everyone was happy with the vote.
The volunteer community-based organization, Lynn United for Change, has been circulating a petition against the project and members showed up to last week’s Council hearing with signs in protest. The group says that while it does not not oppose development they don’t want to see Lynn residents forced out of their own neighborhood due to and oversaturation of market rate development with no affordable housing tied to development projects. With the Munreo Street project at 100 percent ‘market rate’ the group argues that projects like this one may create segregation in the city.
“The City Council’s decision to give this tax break is disappointing,” the group said in a statement after the hearing. “And it’s absurd that a decision like this was made so suddenly, with no chance for public comment. But we’re glad to see a growing number of councilors doing the right thing and standing up to the pressure of big money interests. And most of all, we’re glad to see more and more people actively demanding better…No to exclusive buildings just for the rich, no to gentrification, no to displacement and yes to inclusion of affordable units in new development, yes to respecting and protecting Lynn’s working class and low to moderate income residents.”