By Seth Daniel
ACS Development’s Patricia Simboli explains that the FBI building is a unique project and it isn’t sustainable without the proposed TIF during a meeting of the Council on Tuesday night. A vote on the controversial TIF agreement is expected Jan. 23.
On Tuesday evening, ACS Development presented a compelling case for granting a 20-year Tax Increment Financing (TIF) agreement for their FBI Building on Maple Street. The presentation lasted two hours and included extensive questioning, leaving the Council’s decision more complicated than ever—though some members appeared inclined to support what many consider an exceptional circumstance.
The Council chamber was nearly full, with only four absences: Councillors Luis Tejada, Judith Garcia (recused due to receiving a scholarship from the company during high school), Matt Frank, and Dan Cortell (watching remotely following minor surgery). A Council vote on the TIF proposal is scheduled for Jan. 23.
For approximately 30 minutes, Patricia Simboli of ACS delivered an emotional account of the building’s lengthy development history. The project began when the company responded to a City RFP seeking office development on the site. After initial setbacks with uninterested parties, Simboli noted they pursued the FBI starting in 2007, gaining confidence in their prospects by 2010.
Three separate legal battles and the financial crisis tested the developers’ commitment. Meanwhile, construction expenses escalated considerably during the recent economic boom. The distinctive, high-security facility’s costs jumped dramatically—from $42 million in 2008 to $57 million in 2016, she explained.
ACS seeks a 20-year TIF providing a 50 percent tax reduction on the building’s assessed value for 15 years, followed by a 40 percent reduction for an additional five years. This arrangement extends beyond the City’s typical 10-year maximum TIF terms. The tax savings apply only to new value created by development; the pre-development property generated $55,000 in annual taxes. Even with the TIF in place, annual payments would exceed $800,000, the City has noted.
Under the TIF agreement, initial yearly taxes would reach $870,000; without it, they would start at $1.739 million.
“We really would not be here if we did not have a real and serious financial need,” she said. “It’s not like us to ask for help. We have never asked the City for a TIF before…We had the strongest real estate economy in the country. We experienced an absolutely astronomical jump for construction costs. We also experienced an astronomical increase in the City’s commercial tax rates in Chelsea. It went from $20 per $1,000 of value to $30. That’s a 50 percent increase…We need the City to help us in a way we can’t help ourselves. In the past when we had financial problems, we have never come to the City, but we dug out of the hole ourselves.”
The FBI building’s path involved numerous complications—procurement challenges, legal disputes over the acquisition, and additional government litigation regarding the lease itself. Construction commenced three years ago, with occupancy achieved last November. The project is regarded as delivering substantial regional economic benefits. City Manager Tom Ambrosino supports the TIF, citing the economic development it has already catalyzed, including new hotels, apartment complexes, and the renovated Mystic Mall.
According to both Simboli and Ambrosino, these subsequent developments proceeded with knowledge of the FBI’s arrival. Both emphasized that when ACS acquired the building well before the FBI became involved, a 50 percent TIF was already part of the contemplated arrangement.
Anthony Simboli expressed regret for not presenting to the Council earlier. Given his development work in Chelsea since 1984, he believed the City would naturally support the endeavor.
“I want to apologize for putting this burden of this decision on you,” he said. “I say that because this decision should have been done two, three, four or five years ago…The worst thing is I didn’t make a deal with you before now…We’re not going to make any money on this deal. I’ll prove it. Anyone who wants to know, I’ll let you look at my returns after one year. This City has taken my word for over 30 years that what I say is what I’m going to do. My word is my bond.”
Patricia Simboli elaborated on her father’s arrival in Chelsea during 1984, when investment in the community—particularly on Everett Avenue—was scarce. The company undertook numerous ventures involving considerable risk, ultimately developing the Mass General building, Harbour Pointe office park, and several additional office structures.
“How many other developers will be here 15 years from now?” Simboli asked. “How many will have become community partners and ow many will commit to 14 projects here? We have been. We will remain committed to the community. It’s part of who we are.”
Multiple councillors signaled openness to the proposal.
After considerable deliberation about opposing it, Councillor Giovanni Recupero announced his support.
“I will give you a TIF because it’s a good thing to do,” he said. “If I don’t give it to you, the more taxes are going to have to come the the people…I’m in support because you’ve proved your with us. I’ll give it to you even though the people might say it’s the wrong thing.”
Support also came from Councillors Yamir Rodriguez, Luis Tejada, Leo Robinson, and Paul Murphy.
“This is a totally unique situation and building,” said Murphy. “We’re talking about taxes that are almost a million dollars a year and they will go up. I can’t be against this. What you’ve done for the City is inspirational. If anyone doesn’t think this is a good idea, they have to be crazy. You have my full support.”
Councillor Leo Robinson noted that the City’s inaugural TIF program, approved for Admiral’s Hill, encompassed a 40-year period.
“Without that agreement, there would be no Admiral’s Hill today and they did that for 40 years,” he said.
While expressing support, Councillor Enio Lopez questioned whether ACS could operate successfully under a 10-year TIF rather than 20 years.
According to Simboli, a shorter term would not be viable given the FBI’s fixed 20-year lease obligations. Without adequate revenue, the company would return seeking assistance after a decade.
Councillor Damali Vidot raised concerns about justifying a 20-year agreement at these percentages to constituents, many of whom oppose the proposal entirely.
“This project is unlike any other,” said Simboli. “You are not setting a precedent for establishing a 20 years as your benchmark for TIFs…You’re never going to encounter another situation like this…If we don’t get the TIF, the financial stability of this project is unquestionably in jeopardy. You would bankrupt it. It is unsustainable without the TIF. I don’t think your residents want to do that and I don’t see how it’s good for them.”
Clarity will emerge in the coming weeks as the Jan. 23 vote approaches.