RIAC OKs Cargo Site Mitigations, Owes City $4.5M

WARWICK, RI — Not only has Rhode Island Airport Corporation agreed to keep cargo traffic off city roads and build a new sound barrier, it owes Warwick $4.5 million.

Tuesday, RIAC President Iftikhar Ahmad signed a memorandum of understanding (MOU) committing to the traffic and noise mitigations.

According to a statement from the RIAC about the MOU, the agreement, “reinforces prior commitments to build a sound barrier adjacent to the new cargo terminal and implement a semi-tractor trailer traffic mitigation plan that ensures truck traffic to and from the facility will use the Airport Connector and not local and city roads.”

“We are hopeful the mayor and the council will begin to see this project as an opportunity for the residents of Warwick and not a burden,” said John Goodman, RIAC’s Assistant Vice President, Media & Public Relations.

We have the opportunity to get heavy trucks off of Warwick’s streets and create hundreds of jobs,” stated Goodman. “We have two well-respected companies that want to relocate their operations from Boston to Warwick; companies that want to put Warwick residents to work.”

Goodman said the cargo facility project will be a significant economic generator for the city and the State. He said it will also create over 1,000 construction jobs during a two-year period and another 100 long-term employment opportunities for area residents.

The unpaid payments were discovered during Mayor Frank Picozzi’s team’s research of the state-mandated PILOT agreements after RIAC announced it was cancelling them as the city insisted on the MOU.

The news follows three years of argument during which Picozzi insisted on RIAC’s formal contract for the traffic and sound mitigations for TF Green Airport’s new cargo facility, a development the city cannot veto or control. According to Picozzi’s account, RIAC responded with refusals, token agreements without commitments, then cancelation of yearly $500,000 payments in lieu of taxes (PILOT) before finally signing on to the traffic and sound mitigations.

During the process, Picozzi said, he learned that the RIAC not only cannot cancel the payments because they are mandated by state law, but that RIAC has been under-paying the PILOT since 2005.

During Wednesday’s Warwick City Council meeting, Picozzi laid out the three-year struggle to get RIAC’s promises as written commitments:

How the RIAC cargo facility argument started

About three years ago, RIAC approached Picozzi about plans for a TF Green Airport south cargo facility. Councilman Howe attended.

“The Airport Corporation in no way needs the City’s permission to go forward with this facility,” Picozzi said.

Picozzi and Howe expressed two big asks: Keep truck traffic off local roads, and build a sound barrier between the facility and the nearby neighborhood.

“We already have too much traffic. We were building City Centre, where we have 1,800 units coming soon,” Picozzi told the Council. Additional traffic would be detrimental to the city.

Howe, meanwhile, wanted a sound barrier to protect the neighborhood from noise.

“The Airport Corportation said they agreed and they promised to do it,” Picozzi said.

But, the Mayor said, when the RIAC submitted their plan, it didn’t include either of those commitments.

“We were upset. We went to the airport, we asked them to sign an MOU (memorandum of understanding). They declined,” Picozzi said.

“So, at the suggestion of Mr. (Michael) Zarum, we engaged an attorney.” The City hired Stephen Tabor, a former employee of the FAA. Tabor advised them to submit a petition of review with the FAA. RIAC told them they would wait for the results of the review before deciding on the MOU.

City insists on MOU, RIAC cancels $500K payments to Warwick

About three weeks ago, Ahmad emailed the City Council and several other elected officials that the RIAC had agreed to the requests and that the email served as presenting it in writing.

“That wasn’t good enough. It wasn’t a legally binding document,” Picozzi said. So, he said, they sent their own MOU draft in hopes of discussing that. In response, the RIAC sent a ruling from the FAA disqualifying the RIAC’s $500,000 (Payment in Lieu of Taxes) PILOT agreement with the City, and announced they would stop the payments.

According to an audit of the agreement, Picozzi said, the FAA had ruled the city didn’t provide the services outlined in the PILOT agreement. “I questioned the material they gave to the audit. I questioned the purpose of the audit. It just seemed random. It seemed kinda coincidental.

Picozzi had already approached RI House Speaker Joseph Shekarchi and Gov. Dan McKee about the issue, but they had told him they didn’t have jurisdiction to help. “Well, once they found out they had to find half a million dollars in their budget, they got very involved,” Picozzi said.

State Holds RIAC to PILOT Payments, New MOU Fails Review

Picozzi and Rep. Joe McNamara met with McKee to talk about the problem, and they determined that state law guarantees the PILOT payments even if it’s disapproved by the FAA. McKee said the state would commit to finding the $500,000 for Warwick elsewhere in state funding. They would also support Warwick’s position during the comment period for the cargo facility project.

RIAC sent the city an amended MOU, but it didn’t commit to keeping the trucks off city roads, only to study the issue and take the trucks off the roads if RIAC decided it worked and they could fund it.

“They did the same thing with the sound barrier,” Picozzi said.

“I told them it was unacceptable,” Picozzi said. RIAC asked for a staff level workshop to draft a new MOU. “I said I would only do it if the president of RIAC and myself were in the room,” Picozzi said. He didn’t hear back.

RIAC Signs New MOU, PIcozzi reports PILOT Payments in Arrears

Then, yesterday morning, we got back to work at 9:10 a.m. They sent us an MOU with everything we’ve asked for. I’ve had a review by the solicitor. He said it’s solid.”

Ahmad has signed it, and the RIAC has asked Picozzi to do so, but he said he will only do that once the RIAC board has ratified the MOU when they meet Jan. 11.

“I don’t know what prompted that, what happened over the weekend, but I’m happy,” Picozzi said. “We’ve heard from residents that we should have asked for more, but we’ve done all we can and this was a three-year fight.”

Picozzi said that though he has received criticism that he’s in favor of the cargo facility at TF Green Airport, he’s not actually much of a fan, and would rather the airport wasn’t in the city.

He said the cargo facility is happening regardless. “It’s inevitable. The airport is important to our economy and the state’s economy,” Picozzi said to the Council. “My job and your job is to lessen the impact on life as much as possible on Warwick and I think we’ve done it with this. This is probably the first fight the city has ever won with RIAC.”

While the council will not need to ratify the MOU, since it requires nothing of the city and only puts RIAC’s promises in writing, an easement for the sound barrier RIAC has agreed to will come before the Council, Picozzi said.

Goodman said the project will be a significant economic generator for the city and the State. It will also create over 1000 construction jobs during a two-year period and another 100 long-term employment opportunities for area residents, he said.

Picozzi also cited the law that stipulates the PILOT payments not only require RIAC to make the PILOT payments, it increased the payments to $750,000 yearly since 2005, which RIAC has never paid the city.

“So by my accounting, according to the state law, the Airport Corporation seems to owe us about four and a half million dollars,” Picozzi said, “And I’m going to explore getting reimbursed for that.”

Also, Picozzi said, he asked McNamara to refile an old resolution he had granting Warwick a seat on the RIAC board, which McNamara has agreed to do this legislative session.

“Warwick really needs to have a voice on that board, even if it’s just one,” Picozzi said.