Adams Theater Recommended for 10-Year Tax Exemption
ADAMS, Mass. — The Selectmen on Wednesday approved a 10-year special tax agreement with Adams Theater LLC.
The vote was 3-1, with Selectwoman Ann Bartlett voting nay over the length of the STA and Selectman Joseph Nowak recusing himself over concerns about conflicts as a volunteer and donor.
The STA is structured around $1.5 million to be invested to complete the Park Street theater for year-round use by 2026.
The exemption the first year would be 100 percent, followed by two years each of 75 percent, 50 and 25, and then 10 and 5 percent for the final years.
The total estimated value of the agreement, based on the recent valuation of the theater by the town assessor and projected increases, is $204,000. The theater will be required to report its progress annually to the state during the term of the STA.
"We want to apply a maximum tax relief while the theater is being built up and undergoing these renovations ... so once it kind of reaches full capacity, the town's able to capitalize on some of those property taxes as the yearly exemptions go down," said Colby Tarjick, program manager in the Community Development Office.
Tarjick said the situation is a bit different for this special tax assessment because arts institutions are typically tax-exempt organizations. The Adams Theater, however, is remaining on the tax roll so it seeking some relief as it completes the renovation.
Even under renovation, the theater has been an anchor institution already in the community, he said, hosting numerous events, shows, concerts and movies, he said. "We wanted to bring this forward to reduce some of the tax burden for Adams Theater. We are in recognition for the economic value it brings to the rest of our screen and Adams as well.
They host in the summer movies or for kids in town, and so it's been a real community kind of anchor institution already, while it's still being renovated. And the thought process behind the special tax assessment is because arts institutions are typically tax exempt organizations we typically see in our organizations here, typically run by a nonprofit here, that situation is a little bit different. So we wanted to bring this forward to reduce some of the tax burden for Adams Theater in recognition for the economic value it brings to the rest of Park Street and Adams as well."
Owner Yina Moore said this next phase in construction is on top of some $1.1 million already invested in the property and the cost of its acquisition. While the theater would remain on the tax rolls, it will lease its use for $1 to the nonprofit Adams Theater Presents.
Tarjick used the example of the tax incremental financing agreement for B&B Micro Manufacturing in 2019. In that case, the agreement saw the exemption drop from 100 to zero over seven years to offset the tiny house builder's purchase of the former Brown Packaging on Howland Avenue.
Selectman Richard Blanchard didn't like using the former as an example.
"We're talking apples and oranges. One is a manufacturing company, and the other is more the entertainment side," he said.
Tarjick agreed they were not similar but that was the only example the town had.
B&B had to create 16 full-time jobs; the theater will create four full-time jobs and six part-time jobs. Selectman Joseph Nowak asked how that would work since the theater is seasonal.
"The program [B&B] entered is directly measured by employments that they created, whereas the Adams theater program is more of a cultural program," Moore explained. "It is measured also in direct economic activities that are happening on Park Street. In other words, you know, a theater activates a town in very different way than a manufacturing job. ...
"The theater has a spill-over effect that doesn't necessarily go directly into the payroll of the theater."
The theater is about 75 percent complete thanks in large part to private capital and public grants.
"Adams Theater LLC plans to finish the building rehabilitation by the end of 2026 and become a year-round performing arts venue then," she continued. "Adams Theater LLC intends to rent performance space to the Adams Theater Presents, in the long run, providing affordable entertainment to local families, promoting regional artists and supporting new works."
The nonprofit has a board of five, of which two are the principals of the theater. Moore said she and the other principal recused themselves during the leasing discussions. Adams Theater Presents has a seasonal budget of about $200,000 and she gets zero dollars as she is a volunteer.
Bartlett said she supported the work of the theater and Moore's investment in the community but felt 10 years was too long to deprive the town of taxes. Selectwoman Christine Hoyt said said the highest exemptions would be in the immediate years the theater is completed and added that B&B had moved into a finished building, so there was less investment.
Nowak said he strongly believed in what Moore is doing but was concerned that voting on the tax agreement would ethical because of his volunteerism and donation of a "goodly sum."
It was pointed out he wasn't getting any compensation out of it, but he turned the attorney Lee Smith of KP Law, town counsel, who advised him to do what he felt was comfortable.
Hoyt, before voting, said as a former board member of Adams Theater Presents, the board had no knowledge of the STA other than it was being pursued. Her employer, 1Berkshire, had introduced Moore to the state Office of Business Development but she has no connection the economic development side of 1Berkshire and did not attend a Selectmen's executive session to discuss the STA in July.
"I think the Adams Theater is transformational, as the Greylock Glen Center is, and it's a cornerstone on Park Street ... it's a once in a lifetime for many of us to see Park Street back again with people there on Friday nights, which we do have now, Saturday nights, as Joe mentioned, and also on Sunday," said Chair John Duval.
The agreement will have to be approved by town meeting members and will take effect in the following fiscal year.
Tags: adams theater, tax exemption,
