WORCESTER—The Worcester City Council is considering actions to create an Urban Center Housing Tax Increment Financing Program zone in the city, which would allow it to provide tax exemptions to the redevelopment of Worcester Housing Authority’s Curtis Apartments. The move could save the project an estimated $6.2 million in real estate taxes over 20 years, according to city documents.
The UCH-TIF program authorizes cities and towns to promote housing and commercial development through real estate tax exemptions, according to the commonwealth’s website, allowing them to deem all or part of the increased value of improved property tax exempt.
Worcester City Manager Eric Batista’s administration is asking the council to send an application to the commonwealth’s Executive Office of Housing and Livable Communities to establish a UCH-TIF zone it is calling the East Side TIF Zone.
The East Side TIF Zone as proposed would encompass 335 acres of commercial, industrial, and residential properties in the Lincoln Street area that includes Great Brook Valley Gardens, Lincoln Village, Edward M. Kennedy Health Center and Lincoln Village Retail, in addition to Curtis Apartments, according to documents Batista submitted to the council.
Before the council sends the application to the state’s housing office, Batista is asking the council to send the items to its economic development committee to hold a public hearing and provide a recommendation. The council cannot submit this application to the state until it approves the creation of the zone and a UCH-TIF plan and agreement for 16 and 52 Great Brook Valley Avenue, according to a communication from the city’s Chief Development Officer Peter Dunn.
The project would involve transferring ownership of the grounds of 16 and 52 Great Brook Valley from WHA to an affiliate of the for-profit company Trinity Financial, which would allow it to qualify for certain tax credit programs such as low-income housing tax credits, according to Batista. WHA would retain ownership of the buildings.
The move makes the properties subject to real estate taxes that the nonprofit WHA otherwise would not be. Establishing the UCH-TIF and subsequently entering into a UCH-TIF agreement with Trinity Financial and WHA would relieve the properties of some of the cost of real estate taxes – an estimated $6.2 million, according to Batista. The city will still receive $1.2 million in real estate taxes over 20 years that it would not have received if 16 and 52 Great Brook Valley Ave. stayed completely in WHA’s hands.
Curtis Apartments were constructed in 1951 and houses 1,150 residents in 372 units, according to city documents. The apartment complex has exhibited “extensive deterioration,” according to the documents.
Trinity Financial and WHA plan to tear down 90 of those units across three buildings and replace them with two 4-story buildings with 129 mixed-income units, according to Dunn.
Thirty-nine of the units will be reserved for families earning up to 60 and 80% of Area Median Income and the remaining 90 units will be filled through the state’s Section 8 Program, Dunn said.
The $91.5 million project is expected to start at the beginning of 2024 and be completed in the third quarter of 2025, according to Dunn.
The project marks the first phase of the redevelopment of Curtis Apartments, with the ultimate goal of redeveloping the site’s 372 units into 527 new units. All of the current tenants of the 327 units will be given the option to return to the new apartments, according to Dunn.
The proposed UCH-TIF zone has a median household income of $39,612 compared to the citywide median household income of $51,647, according to 2020 Census Data.
“The proposed UCH-TIF Zone encompasses an area that has experienced substantial disinvestment,” a draft of the application reads. “Many buildings are deteriorated, vandalized, underutilized, and vacant, making it difficult to promote private investment and new business.”
Establishing the zone and a plan for it would increase and improve the residential features of the neighborhoods in the zone and “reinvigorate interest in the commercial and industrial redevelopment of the East Side of the City of Worcester,” according to the draft application.
The city council is set to discuss the creation of the UCH-TIF zone at its meeting Tuesday.
Kiernan Dunlop is an award-winning journalist who has spent the past five years reporting in Worcester, New Bedford, and Antigua and Barbuda. Her work has been published in Bloomberg, USA Today, Canary Media, MassLive, and the New Bedford Standard Times, among other outlets. She can be contacted at kdunlop@theworcesterguardian.org
