The Pawtucket City Council voted 8–0 to authorize the mayor to enter a tri‑party agreement amending an existing ground lease so Penrose LLC can develop an affordable housing project on a parcel on School Street.

The resolution, recommended earlier by the City Property Committee, carves one parcel out of a larger four‑parcel lease with Fortuitous Tidewater OZ LLC, creates a separate 99‑year lease for Penrose, and establishes application and construction timelines keyed to Rhode Island Housing’s low‑income housing tax credit (LIHTC) cycle. Councilors were told the carve‑out is intended to allow Penrose to seek its own financing and move forward independently from the other components of the Tidewater Landing development.

Why it matters: The agreement is intended to make the parcel competitive for state LIHTC awards by providing a direct, long‑term lease and a clear timetable for applications and post‑award construction. Developers told the council they expect to submit an application in December; the agreement allows Penrose up to three successive application cycles if an award is not secured on the first try.

City and developer commitments: Attorney Jeremy (representing the developer team) told the council the carve‑out is necessary because “they require a straight 99‑year lease agreement” and to meet Rhode Island Housing’s expectations for applicants. He also said that, if awarded tax credits, the developer would be required to move the project quickly: “from the time they get the award, they have to finish the project in 2 years.” The agreement includes developer commitments around timelines and certain site improvements to strengthen the application.

Tax and financial context: Councilors discussed how the project would be taxed. Councilor Rubio asked whether the city would receive property tax revenue while units are vacant. Staff explained that LIHTC projects pay a fixed 8 percent payment in lieu of full property tax on a revenue basis under state practice for these projects, and that the city’s receipts depend on rental revenue; an early, rough estimate of annual payments was cited as about $68,000 (the administration said it would provide a more detailed estimate once final occupancy numbers are set).

Contingencies and city risk: Councilors pressed on what would happen if Penrose failed to secure LIHTC awards. Staff said the agreement contemplates termination triggers if developers do not meet required milestones; the parcel would remain city land and revert to city control if the lease is terminated. The city also confirmed it had no affirmative obligation for off‑site infrastructure (water, sewer, streets) as part of this lease carve‑out, although public infrastructure is contemplated as part of the broader Tidewater Landing development.

Council action and next steps: The council approved the committee’s recommendation and authorized the mayor to execute the tri‑party agreement. The developer plans to submit the initial housing tax credit application this December and, if awarded credits, expects to meet Rhode Island Housing timelines for construction and occupancy.

Ending: The resolution accompanies continuing work on Tidewater Landing; the council referred related financing items for further review by the finance committee.