Editorial: Abercrombie Building project missed chance to create jobs

  • The Abercrombie Building on Bank Row in Greenfield. Recorder Staff/Paul Franz

Tuesday, January 09, 2018

The Greenfield City Council did the right thing when it upheld a tax break it had granted the redeveloper of the long vacant Abercrombie Building at the bottom of Bank Row. We aren’t so sure about the original decision, though.

Council Vice President Isaac Mass wanted to reconsider the 10-year Tax Increment Financing agreement for the four-story brick building at 56 Bank Row, which has been largely vacant for at least 40 years and is being rejuvenated to house the Northwestern District Attorney’s Office and a nonprofit arts organization.

But late last month the council overwhelmingly rejected the idea of reneging on a promised $14,398 reduction in property taxes over 10 years. Such agreements, when approved, often trigger related state tax beaks and are factored into a developer’s financial prospectus.

The building is currently valued at $149,700, according to John Lunt, assistant to the mayor for special projects. That value is expected to increase to $2.3 million after the renovation, bringing with it more tax revenue than the vacant building would have.

We agree with Mayor William Martin, who said Greenfield had to stick by its agreement. “When a community makes that commitment, that promise, it means something,” he told councilors, adding, “It’s our reputation. Once we make a commitment and we vote and approve it, then it should stand.”
The District Attorney’s Office, formerly located on Conway Street, will move 35 employees and is expected to move into the building some time in the new year. Conjunction Arts, a sort of arts organization incubator, is expected to take up residency in August on the fourth floor.

This reuse is a good thing. It will convert a long disused downtown property into a productive one that pays more taxes to the city. The arts organization sounds like it could benefit the community’s burgeoning creative economy.

Yet, former council President Brickett Allis wasn’t completely off-base when he opposed the original TIF, saying it was leveraging very few new jobs — the original intent of the state-sanctioned tax break program. The DA is simply shifting jobs from Conway Street and the arts group will create only two full-time and four part-time jobs. In this case, the counter argument, which won the day, seems to be that bringing an old building back to life and boosting its future tax payments, by itself, is worth the modest $14,398 investment by Greenfield.

That may be, but the program was originally intended to encourage job creation by growing of existing businesses and industries or attracting new ones. Job creation infuses cash in the form of payroll that then multiples through the local economy. Over the years, granting TIFs has become standard for almost any development, big job gains or not. It may be that even the smallest developers or businesses have come to expect that extra financial incentive, whether or not it’s truly vital for their business plan.

We would urge the council and mayor to scrutinize future tax break requests, placing an emphasis on job creation and otherwise ensuring that if tax break recipients aren’t helping create jobs, they at least bring other strong economic benefits to Greenfield and really are necessary for a project to move forward.