The Mack Building redevelopment project is expected to go forward following a 9-1 vote of the Chelsea Downtown Development Authority.
The vote took place at a special meeting on April 26, with overwhelming approval.
After a discussion on April 19 to consider a request from developer Joe Ziolkowski for an additional $60,000 from the DDA to help close a funding gap for the project, all members present offered their thoughts.
Last week, the developer told the board that following the bidding process for the estimated $1.7 million, 7,700-square- foot building redevelopment project, he needed help with increased funding from all parties involved, he, the city and the state.
In addition to the increased funding from the DDA, he increased his personal investment in the project and was granted an additional $180,000 in CBDG (Community Block Development Grant) funding from the state.
Each member of the DDA present offered a comment on the project prior to the vote.
Board Member Phil Tolliver said he knew the developer as a person and a developer and commended Ziolkowski for “pretty interesting projects that he sees through to the end. I think he’s the guy to do this project and pull it off.”
Among the other comments were the additional tax revenue that will come to the city once the project is complete, which are estimated to be about $20,000 per year.
The DDA previously committed $40,000 over five years and this request will mean an extra $12,000 per year over multiple years.
The board voted to amend the development agreement and pay the developer over a six-year period, beginning with the 2019-2020 FY budget. These is a provision that the DDA can pay off the commitment sooner if there is money available in the budget.
Previously, City Manager John Hanifan said there is also a “reverter clause” in the agreement that stipulates “if the developer doesn’t do what he says he’ll do, the building reverts back to the city.”
Adapting and redeveloping historical buildings is something a large number of residents told the DDA and the city they would like to see done for this property.
One of them was Jan Bernath, who also spoke before the vote. “I’ve followed this project over the years. … Joe has done a remarkable job.”
She also reminded board members that history and Heritage tours bring people and revenue into the downtown.
In 2015, the developer submitted a redevelopment plan to the DDA that preserved the exterior of the building, and included apartments on the second floor and commercial space on the ground floor. This was followed by the developer seeking $500,000 in federal grant funding with the help of the city/DDA, which owns the property.
This grant is jointly held by the developer and the city/DDA and the project must comply with numerous standards including Federal employment wages. He successfully requested and was originally approved for $525,000 for construction and $25,000 for grant administration. On April 19, an additional $180,000 in state Community Development Block Grant program funds were awarded.
“Since I’ve been on this board, this project has been on the table,” said Chairman Tim Merkel, “This is a good ending to this. I’d like to see it move forward.”
In addition, said Board Member Doris Galvin, “this is in alignment with the DDA’s mission and vision.”
Plus, she said, it will provide something attractive for people arriving in town from the north.
Board Member Charles Wiseley, was the lone “no” vote on the request.
“While I’m sure Joe is the right guy (to redevelop the property),” he said, “I haven’t supported this from the start and I don’t agree with this (the request for additional funding).”
Numerous board members reminded the group that an enormous amount of time and money had already been spent on this project and if it didn’t go forward, there was the possibility that the building would be demolished, and additional funding would be needed to do that as well.
Several members did mention that the parking situation in the downtown is an issue that they need to tackle soon, especially on that side of town.
“This project is somewhat like a big pot of stew,” said Board member Bill O’Reilly, “Lots of ingredients have gone into it. And while I don’t necessarily agree with each ingredient, we don’t have a long line of bidders willing to take this project on but it’s important that we move forward.”
He addressed several board members concerns that this expense might impact the DDA’s ability to fund other projects, such as parking improvements. He reminded board members that projects of this scope could only be afforded with bonds that can include additional downtown improvement projects.
“The added expense of the Mack Building project won’t necessarily mean other improvements won’t happen,” he said.
If you’d like to watch a video of the meeting produced by RK Studios, please click here.
