Section 108 - 2006 Economic Development Projects - Massachusetts

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Lawrence Gateway Redevelopment Project
Lawrence, MA
Section 108 Guaranteed Loan- $2,900,000

The City of Lawrence in collaboration with The Merrimac Valley Regional Transit Authority (MVRTA) will provide financial assistance for the redevelopment of a 20-acre blighted plot of land in the Gateway District of the City. The site is located within a federally-designated Renewal Community, and is also located within a State-designated Economic Opportunity Area. The project will include the construction of a 2.8-acre public park and a 1,025-space surface parking facility. The parking facility will be built on an 8.46-acre parcel of the site which is currently owned and is being renovated by GenCorp. GenCorp is carrying out remediation on the Site under a 2004 US Environmental Protection Agency-approved Remediation Action Plan. The surface parking facility must be completed before GenCorp may transfer title of the 8.46-acre parcel to MVRTA.

The City will utilize $500,000 of its Section 108 Guaranteed Loan proceeds to finance the redevelopment of a 2.8-acre City-owned parcel into a public park. The remaining $2,400,000 of the Section 108 Guaranteed Loan proceeds will be re-lent to MVRTA to finance the filling in of underground raceways on the 8.46-acre plot. The City will utilize $725,000 of its $2,000,000 in Brownfields Economic Development Initiative (BEDI) grant funds toward establishment of a debt service reserve. The City will utilize the remaining $1,275,000 in BEDI funds toward the installation of other site improvements (including clearance and remediation of polychlorinated biphenyls and asbestos) for the development of the public park. The total cost of the project is $19,456,875.

The Community Development Block Grant (CDBG) national objective for the City’s use of its guaranteed loan funds is to benefit low-moderate income persons through job creation. The project will cause the creation of between an estimated 400 and 1,200 new jobs as the parking spaces will encourage commercial development of new office and retail space in buildings around and adjacent to the parking site. Also, the CDBG national objective for the use of the Section 108 Guaranteed Loan is to prevent/eliminate blighted areas and slums on an area basis. The lack of public amenities has contributed to the areas demise and so this project will revive the economic viability of the area.

The City will repay the Section 108 Guaranteed Loan over a twenty-year period, paying interest only for the first five years. The City will use parking facility revenues to repay the loan. To secure the repayment of the loan, the City will pledge its interest in its third-party loan to MVRTA, secured by a first lien position on the Site’s parking facility and its CDBG funds.