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Gov. Patrick uses rebuilt mill as setting to announce Gateway funding

October 19, 2012

Rice_Silk

PITTSFIELD, Oct. 19, 2012 - The grand opening of Rice Silk Mill provided a perfect setting for Governor Deval Patrick to announce that Pittsfield will be the state's first city to have part of its downtown approved as a special district under a new state program designed to help Gateway Cities rebuild and strengthen their economies.

Gov_PatrickGovernor Patrick announced that the Onota and Howard buildings at the corner of North Street and Fenn Street will comprise the first approved district under the state's new Housing Development Incentive Program (HDIP). This program offers real estate tax exemptions and state tax credits to help cities develop housing, stabilize neighborhoods and boost economic development.

The Onota/Howard revitalization plan put forth by the developer, Allegrone Construction, proposes to transform these downtown buildings would complement three previous public investments in Pittsfield: 1) the $15 million Rice Silk Mill; 2) the creation of a downtown arts district and 3) a comprehensive streetscape improvements totaling $11 million.

"Investing in housing generates jobs, grows local businesses and strengthens our communities," said Governor Patrick in announcing that Pittsfield would be the first city to utilize HDIP. "Supporting reasonably priced housing for moderate and middle income families, along with our strategy of investing in education, innovation and infrastructure, will fuel economic development."

Speaking on Friday afternoon, Oct. 19, Governor Patrick also praised the city for supporting Rees-Larkin Development for rehabilitating the Rice Silk Mill into 45 rental homes. Forty-three of the units will be affordable to families below 60 percent of area median income, and two units will be rented at market rates. The L-shaped brick building has been remodeled into 19 one-bedroom, 19 two-bedroom and seven three-bedroom apartments. The mill, which in its heyday specialized in making parachute materials for the military, is located in the Morningside neighborhood within walking distance of downtown.

"There's an important relationship between economic development and housing," Governor Patrick said. "As we compete for jobs, we have to figure out where the workers are going to live. Pittsfield understands this and has helped turn this mill into a 21st century asset for the families of this community."

Pittsfield supported the Rice Silk Mill development by applying to the state for funding under the state's Chapter 40R program, which provides incentives to build affordable housing near downtowns and transportation centers. The city also provided a total $525,000 through federal block grant and stimulus funds.

"This is a city smart enough and progressive enough to jump onto the things the state government and this administration, provides," said Jon Rudzinski, principal of Rees-Larkin Development. "This city has a long-term vision of what redevelopment means and that's why this project is happening today."

Most of the financing for Rice Silk Mill was provided through federal low-income housing tax credits awarded by the state Department of Housing and Community Development (DHCD), with WNC & Associates as the tax credit investor. DHCD also provided $715,000 in federal HOME funds and $975,000 from its Housing Stabilization Fund. People's United Bank was the construction lender. Rice Silk Mill also received state historic tax credits, with the Berkshire Fund as the state tax credit investor. The development also received $851,000 from the state's Affordable Housing Trust Fund.

The Massachusetts Housing Partnership (MHP), used its $1.1 billion bank-funded loan pool to provide $800,000 in long-term fixed-rate financing. MHP, which provides more debt financing for tax credit rental projects than any other lender in the state, has now provided over $816 million in loans and commitments for the financing of over 18,000 units of rental housing.

"We are a community revitalization lender and we know it takes incredible leadership to get things done," said Clark Ziegler, MHP's executive director. "It takes local support, zoning and planning, it takes a strong development team and it takes support from the state. On that note, we've worked with a lot of governors and when it comes to supporting the state's smaller cities like Pittsfield, Governor Patrick's commitment is second to none."

A crowd of about 100 people filled the Rice Silk Mill's second floor community room to see Governor Patrick speak. Other speakers at the event included Pittsfield Mayor Dan Bianchi and Rep. Patricia Farley-Bouvier.

For more information about this development and how MHP financing can be used to support affordable rental housing development and preservation, contact Director of Lending David Rockwell at 617-330-9944 x222.

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