Everett City Council again stalls TIF agreement for proposed Second St. mixed-use development

By Neil Zolot

The City Council tabled a request for a 14-year Tax Increment Finance (TIF) agreement for a proposed planned development at 380 2nd St. — for a 620 unit/21 story mixed-use building, known as The Sofia — a long unused building which once housed an auto-find company, a Brazilian church and a lift truck service, at their meeting Tuesday, May 27. It is unlikely it will come up again before the next regular meeting scheduled for Monday, June 9.

Councillors are not against the concept but expressed concern about its length in this case. “Can we make it less?” Councillor-at-Large Katy Rogers asked.

“Unlikely,” Consultant Judy Pelletier of CRE Asset Advisors answered. “If you shorten the TIF you’re making the project less financially feasible than it already is. It can’t be less.”

“Is it a good deal for the city?” Ward 3 Councillor Anthony DiPierro asked, somewhat rhetorically since he is in favor of the project.

“I believe it is,” Managing Partner Christian Reenstierna of CRE answered. “If the TIF doesn’t move forward, I believe it will take years for another developer to get confident with this.”

“Without a vote the Sofia can’t go forward,” CEO Scott Brown of developers Fulcrum Global Investors added.

Fulcrum offered some concessions, including paying $2 million directly into the City’s Affordable Housing Trust Fund, making provisions for local High School students to participate in job fairs and an apprenticeship programs, establishing a Tenants Improvements Package loan program for businesses and, responding to a request from Councillor-at-Large Katy Rogers, to not use the word “luxury” in advertisements and descriptions of the building, which she feels has been overused and is elitist. “It seems like some language needs to be cleaned up,” Brown acknowledged.

City Council President Stephanie Martins expressed concern that the $2 million would be paid after construction. “They won’t have the revenue [until then],” Mayor Carlo De Maria responded.

Councillor-at-Large John Hanlon said he is worried the TIF will set a precedent and attract developers looking for TIFs. Martins agreed.

“I wouldn’t anticipate that,” Reenstierna feels. “I don’t know how many opportunities there’d be.” He also warned that denying the TIF could scare developers off.

Another sticking point was the provision to waive the $3.5 million building permit fee. Brown countered that in addition to the $2 million, Fulcrum will pay for a $3.4 million environmental cleanup on the site and pay for peer reviews for the project. “Money is being redirected,” he said, but Director of Community Planning and Development Matt Lattanzi interjected, “It is a waiver.”

Ward 5 Councillor Robert Van Campen was not satisfied. “My goal is to have the Building Permit fee paid, not waived,” he said.

Councillor-at-Large Guerline Alcy Jabouin is unsatisfied with the rents for the 42 affordable units, now comprised of 33 units for veterans under the Dept. of Veterans Affairs Supportive Housing (VASH) program, which will be priced at 30% of the Area Median Income (AMI), three other units at 60% of the AMI and five other units at 80% of the AMI. Rents are currently planned at $2,300 per month for a studio apartment; $2,700 per month for a one-bedroom apartment and over $3,000 for larger ones, in part because Everett is in an AMI cohort that includes similar communities like Malden and Medford, but dissimilar ones like Lexington, Newton, North Reading and Winchester. The income levels in those affluent communities’ skew affordability under the AMI above the means of many residents. “I can’t call that affordable,” she said.

DeMaria countered that the rents are similar to others in Everett. He also admonished her for her comments on the units adding to the population of students in overcrowded schools, which is unlikely given the size of the apartments.

Other business

In other action, the members approved an item requesting the state Attorney General to commence action to recover the $180,000 in longevity payments “improperly” paid to DeMaria, an allegation made in a report from the Inspector General. The mayor has stated from the beginning of the council’s pushback that he invites the attorney general to weigh in given that — if there were any — the AG’s office would have reported that by now.

The members also approved borrowing $3 million for two capital improvement projects, specifically $2 million for Streets & Sidewalks and $1 million for the Complete Streets program, which also covers crosswalks and ramps. Streets will include Estes, Grover and Miller Streets and Meadowview Road, which are located between Wehner Park and Whittier Drive and the Malden line. The Ways and Means Subcommittee recommended favorable action on May 19.

In a meeting Wednesday, May 21, the Budget Subcommittee voted to reduce the Department of Diversity Equity and Inclusion (DEI) Professional Development line item from $50,000 to $30,000 by a vote of 6-4 with DiPierro, Hanlon, Rogers and Ward 1 Councillor Wayne Matewsky in dissent. This will also lower the entire DEI Department budget request of $486,662, which is lower than the Fiscal 2025 budget of $521,280, thereby cutting the two dept. employees’ salaries in half.

Before the vote, Martins asked DEI Director Cathy Draine about how the money was spent, particularly regarding conferences employees attended. Draine answered that professional development enhances “our ability to be robust in responses by getting necessary training” and the conferences give employees information on new regulations and how to comply with them.

A motion by Alcy Jabouin to reduce salaries by $30,000 from the requested $225,662 was defeated 7-3 with Martins and Ward 6 Councillor Peter Pietrantonio joining Alcy Jabouin in the minority. Salaries for Fiscal 2025 are $219,100.

Despite her vote, Martins said, “I support DEI and will approve any appropriation once I know the work that needs to be done is being done outside the office. It’s about getting to know who’s in the community and how to work with them. It’s about inclusion not exclusion. We’re informed you don’t talk to the two women of color on the Council.”

“It’s a busy office,” Hanlon countered. “I visit and see the work they do. It’s not people just sitting around waiting for a phone call.”

Draine’s Fiscal 2025 salary is $140,966. The Fiscal 2026 request is $145,195.