Providence city government and the Providence Journal have reached an agreement on the ProJo’s tax assessment lawsuits that will lower the newspaper’s property tax liability on its properties in Providence by about $2.5 million.
Under terms of the deal approved by Superior Court Judge Patricia Hurst, the Journal will get a tax credit of $625,000 in 2012, $833,333 in 2013 and about $1 million in 2014.
The settlement was filed in court last Friday before a trial on the issue, which was scheduled to begin today.
The ProJo essentially claimed the company has been overtaxed since 2000 on two properties it owns in Providence: An office building at 75 Fountain Street that houses business offices and the newsroom, and a production plant at 204 Kingsley Avenue where the newspaper is printed. The newspaper asserted that the tax assessments establishing the value of the two buildings had been set too high – higher than the buildings would bring on the real estate market if sold.
Sources close to the negotiations who spoke only anonymously said the company had a point on the 75 Fountain Street building, given the glut of office space in downtown Providence. The the newspaper’s personnel cutbacks of the past few years have left much of that building vacant.
The same sources, however, said that the newspaper did not have such a good case on the production facility on Kinsley Avenue, where the ProJo prints not only the Journal but also other newspapers in the region, including dailies in Fall River and New London. (If you are wondering why you don’t get late sports scores in some ProJo editions – as was the case this a.m. on last night’s Red Sox-Yankees game, the reason is that printing the other newspapers have forced the ProJo to tighten Journal deadlines, say Sports Department sources).
In a series of lawsuits, the Projo asked for $5 million and in the end, the two sides compromised on $2.5 million.
One wonders if the Fountain Street building is being dressed up for sale. It is not near to being fully used. Under terms of the agreement, the tax deal would be transferable “in whole of in part, at the discretion of the Journal, to any purchaser of such property.’’
The newspaper did run a brief item without a byline on the tax deal in Saturday’s editions.