CENTRAL FALLS, R.I.—Against the backdrop of city service cuts, additional property tax hikes and the stigma of a municipal bankruptcy, city and business leaders in Central Falls are holding up a message: The city is open for business.
The struggling municipality is holding a business networking event Wednesday evening sponsored by Rhode Island Young Professionals and a Rhode Island credit union that got its start in 1915 in a Central Falls church basement.
"This community has a lot of potential, but needs a little help," said Sandra Cano, business and community development officer for Navigant Credit Union.
State receiver Robert Flanders Jr. filed for bankruptcy on Central Falls' behalf in August, and he has since laid out a financial recovery plan that emphasizes pared expenses, increased taxes and drastically reduced pensions. But another key part of the city's future is economic development.
"There's a tough time in the economy. It's not only in Central Falls, it's all over the country," said City Councilman James Diossa, who is helping organize the networking event. He added that Central Falls would welcome any new jobs.
But the economic development pitch is a tough sell in this one-square-mile city of 19,000, where property taxes have already gone up recently by double digits and city services have been cut back, as Flanders put it, "to the bone."
At the start of the current fiscal year, Central Falls was facing a more than $6 million budget shortfall and an unfunded pension and benefits liability of $80 million. Flanders closed the community center indefinitely over the summer and shut down the library, which was later re-opened by a crew of volunteers. The group recently raised $40,000 in an effort to "save" the facility.
Jason Faria, who co-owns the International Meat Market with his brother, says the annual property taxes on his butcher shop and an adjoining property -- now just a parking lot -- have skyrocketed to about $14,000. The taxes are slated to go up again 4.25 percent this year -- and another 4 percent each of the next four years -- as part of Flanders' effort to balance Central Falls' budget and put the city on a sustainable fiscal path.
"People are going to start leaving," says Jason's brother, Jesse Faria. "That's our lifeline. That's our customers."
The Farias, who have five employees, say their net business income is up, but so are their expenses -- including water and sewer bills as well as electricity. They tried to get a loan to build a new store on the adjacent lot, but said they were turned down. More recently, they attempted to get a loan to finance construction of a new walk-in cooler to replace an old, energy-inefficient one. They were turned down by multiple lenders, they said.
"The banks, they don't want to take the chances anymore," said Jesse Faria, adding that he and his brother will come up with the $60,000 themselves for the new cooling unit by cutting expenses and dipping into their own money.
While he and his brother are wedded to doing business in Central Falls -- the shop has been in the family for nearly 30 years -- Jesse Faria says he wouldn't encourage a new business owner to open up there.
"Absolutely not -- not for the money we pay here," he said. "We're not trying to get rich. We're just trying to make a living.
"If we were getting something in return" for the property taxes, he said, "it probably wouldn't sting so bad."
Cano, of Navigant Credit Union, says Wednesday's event, at a credit union branch office, is designed to "bring some life to the city." The bank is aiming to serve as a community resource, she said, possibly organizing Spanish classes for business owners so they can better serve a largely Spanish-speaking population, or hold information sessions on how businesses can secure loans.
Navigant CEO Gary Furtado and General Treasurer Gina Raimondo are expected to attend.