The Providence City Council pulled a $165,000 tax abatement linked to the arts nonprofit AS220 from Thursday's agenda, sending it back to committee after two councilors argued it would mainly benefit for-profit restaurants and a bar rather than the nonprofit itself, and after a colleague raised a possible conflict of interest.
The abatement, item 29, had been scheduled for a roll-call vote at Thursday's meeting, according to the council's published meeting recording. An abatement is a reduction in a tax bill that has already been assessed, as distinct from an exemption, which removes the tax obligation entirely. Councilwoman Ryan told her colleagues that a state law created a tax exemption specifically for AS220, not for its affiliated businesses, and said what was actually in front of the council was an abatement for those affiliates, which she said are for-profit LLCs. She named two restaurants in the building, Viva Mexico and the George, both on Washington Street, as beneficiaries, and said the abatement would cost the city $165,000 in the current budget year. Ryan argued the move would shift commercial tax burden onto homeowners, a pattern she said has already totaled roughly $1.5 million citywide.
Councilman Taylor also opposed the item and, before the discussion went further, asked the city solicitor whether an elected official could vote on the matter if a relative owned one of the businesses inside the building. The solicitor said the office had not reviewed that specific question and would need time to gather facts before offering guidance, declining to answer on the spot. Taylor said the situation reminded him of an earlier abatement tied to a Brown University-affiliated bookstore, and questioned why for-profit tenants inside a nonprofit's building should receive relief while a paying customer, such as himself, would still owe sales tax on a meal there. He said he counted roughly four for-profit businesses in the building, including a bar, that stood to benefit, and said only a small number of apartments in the building qualify as affordable housing.
Majority Whip Sanchez said he planned to vote no in hopes the matter would be sent back to committee for further review. Council President Pro Tempore Pichardo asked clarifying questions about the total dollar figure and confirmed that, under the arrangement being described, commercial businesses operating inside the nonprofit's building would continue to be taxed separately at commercial rates and would still pay state sales tax, apart from the abatement itself.
After that exchange, the council president called a brief recess and asked the item's two sponsors, including Pichardo, to confer privately before any vote. When the council reconvened, one of the sponsors said the intent had been to secure relief for AS220 itself, describing the organization as a provider of affordable housing and arts programming, and said the sponsors agreed the legislation needed further clarification before moving forward. He moved to withdraw the pending motion to pass the abatement, and the seconding councilor withdrew his second as well.
The council then voted by voice to refer item 29 to its special committee on Ways and Means for additional review. No date for the committee to take the matter back up was announced during Thursday's meeting, and the abatement remains unresolved pending that further work.