Worcester economic committee recommends approving $101M WooSox financing

Courtesy | City of Worcester A rendering of the Worcester Red Sox stadium in Worcester.

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The $101-million financing package for a Canal District baseball stadium development is one step closer to reality as the Worcester City Council’s Standing Committee of Economic Development on Wednesday ended its second public hearing on funding a new stadium for the Pawtucket Red Sox by recommending approval to the full council.

The public hearing, about two-and-a-half hours long, ended with the vote and applause from the standing-room-only crowd after the unanimous vote of the three committee members. The City Council is expected to vote on the proposal next week.

The proposal calls for Worcester to borrow nearly $101 million. The city will be on the hook for about $70.6 million, while the team will pay its share in the form of $30.2 million in rent payments over a 30-year lease.

The club is expected to make a $6 million equity contribution to the construction of Polar Park, which is what the park is expected to be named once a deal is approved between the team and Worcester manufacturer Polar Beverages.

The ballpark itself is estimated to cost between $86 million and $90 million.

Dominating the discussion, much like the first public hearing held last week, was the Worcester Community Labor Coalition, which consists of dozens of local labor unions and other community-oriented groups. The coalition has been advocating for a community benefits agreement to ensure the ballpark, hotels, restaurants and other aspects of the project employ locally and diversely.

Others with the coalition called for Canal District-area rents to be frozen to prevent gentrification.

Speakers were overwelmingly in favor of the deal, but there were a few skeptics of the proposal, including College of the Holy Cross economics Professor Robert Bauman, who repeated some of his concerns voiced at last week’s hearing in Crompton Place on Green Street.

Bauman referenced declining baseball attendance at every level. The PawSox themselves have seen average attendance fall from an average of 9,561 in 2005 to 5,982 in 2018.

In Major League Baseball, average attendance has fallen from a 20-year high of 32,696 in 2007 to 28,736 this year, according to baseball-reference.com.

“I’m not worried about the deal for the first five to 10 years,” Bauman said. “I’m worried about it in the second and third decades.”

PawSox President Charles Steinberg said although levels have declined, attendance has been somewhat stable.

Baseball remains America’s pastime, he said.

“More people buy tickets to go see Major League Baseball games and minor league games than buy tickets for football, basketball and hockey combined,” he said.

Stephen Gordon, a Worcester lawyer, said Madison Properties, the Boston developer proposing to build two hotels, apartments, restaurants and retail space as part of the project to help the city fund the project with new revenues is not legally obligated to undertake its portion of the project.

Gordon noted the city doesn’t know how much the team is profiting. He called on the city to do a public study to find out how much the team can afford to invest in the project.

City Manager Edward Augustus responded saying city officials and Denis Dowdle of Madison Properties have had months of discussions about the project. Dowdle has a purchase agreement to buy the property.

“I assume he wants a return on investment,” Augustus said. “Not only do we have a good, reputable developer who we know and trust, we also have somebody whose interests align with the city’s interests.”

In addition to the financing package, approval by the full City Council will set in motion several things to move the project along, including accepting project-related grants, in-kind contributions and other gifts related to the project. The state is pitching in $35 million for infrastructure improvements including a parking garage, but that doesn't include a planned reconstruction of Kelley Square.

Augustus will be tasked with approving the precise location of said parking garage and accept the conveyance of the parking garage property from Boston developer Madison Downtown Holdings and to lease property to the developer and the future Worcester Red Sox.

Also up for approval are two tax-increment-financing agreements between the city and Madison Downtown Holdings relative to two hotels planned for the parcel adjacent to the ballpark and a tax-increment-exemption agreement relative to the planned 225 market-rate apartments.

City Hall is seeking to waive the first $2 million in project administrative fees for the developer.

Finally, the project will require a project coordinator to work out of the city's Executive Office of Economic Development.