Hang on to your wallets! The Superman Building project has all the makings of another 38 Studios.
RI Taxpayers President and Moderate Party RI founder Ken Block makes the ironclad case against any taxpayer assistance whatsoever for the redevelopment of the Superman Building. (His analysis from last year of the “moral” and other hazards posed by the state’s involvement in 38 Studios can be found here .)
Here we go again. Has the state of Rhode Island learned nothing from 38 Studios?
Five years ago, a real estate development company purchased the ‘Superman Building’ in downtown Providence. We just learned that this company, High Rock Development LLC, ‘needs’ $40 million of RI taxpayer money, plus substantial dollars from the federal government and the city of Providence, in order to rehabilitate the building and turn it into rental apartments.
Once again, a connected business person has come to the RI General Assembly deep in the session asking for the state to act as an investor of last resort for a private project. Had Curt Schilling’s 38 Studios been a solid investment he would have been able to line up private investors for his project – but he could not. Now we have High Rock asking for an investment from the state that should instead come from private investors. If High Rock cannot find the private financing necessary to make their deal work, maybe it’s not such a good deal.
I would argue that nearly two years after getting hoodwinked with 38 Studios, RI should not once again make a risky investment in a project that is not financially viable. The State of Massachusetts rightfully laughed at us for our 38 Studios folly – we cannot afford to go down this road again.
Rhode Island needs to end this pattern of crony capitalism. We cannot continue to pour taxpayer dollars into projects backed by the politically connected. We need to be rebuilding our economy in a way that creates economic development across the board, not just a boon for a handful of people tied to legislative leadership who seem to have a talent for securing taxpayer funding for projects that are unworthy of private sector support.
To the men and women of the Rhode Island legislature I ask this question: If your leadership has not learned any lessons from the awful mistakes of 38 Studios, will you step up and show RI voters that you have? It is unimaginable that once again every Rhode Island citizen is being asked to donate $40 to a sweetheart, insider deal while we are still feeling the painful sting of the last one.
Why should a dime of Rhode Island taxpayer money be spent on this privately owned building? Prior to closing the purchase of this building, the savvy developers at High Rock HAD to know what the future renovation costs of this building were going to be. They also VERY LIKELY knew that their tenant, Bank of America, was going to be a short term tenant and that their property would end up vacant.
I call on the Governor and legislature to step up and say “No more”. It is time for our elected officials to stand up and act in the best interest of the voters who elected them to their offices. No more special deals for insiders. We are still smarting from our last foray into fiscal foolishness.
Fool me once, shame on you. Fool me twice shame on me. The State of Rhode Island has already been duped by the 38 Studios debacle and many legislators indicated that they did not know on what they were voting when they approved that deal.
There will be no fooling this time. The voters are watching and expecting that you will show yourselves to be true public servants who exercise discretion and will protect the State’s interests from voracious special interests whose idea of economic development is putting our money in their pockets.