Eastbayri.com

This time next year, the sweet smell of success could be wafting down Main Street.

A plan to bring a ‘kitchen incubator’ to the vacant Main Street School building took a big leap recently, when members of the Warren Town Council voted unanimously to enter into a “memorandum of understanding” with the project’s coordinators. The councilors’ vote to go full-in with the innovative business model was one of the last things entrepreneur Lisa Raiola and her group needed to get the $3 million project off the ground. Now, the Bristol resident can work on financing and plan toward construction, which could start as early as the late spring or summer. Warren Town Planner Caroline Wells said Hope and Main could conceivably open by the late fall or winter.

“It’s a big step,” said Ms. Wells of the recent development.

It’s been a long road. Ms. Raiola’s kitchen incubator idea isn’t much different from similar models that have already found success elsewhere in the country, including California and Boston, but it is new in Rhode Island. The idea is to transform the school into a teaching center geared around small kitchen-based businesses. There, entrepreneurs who want to produce, market and sell their own creations — smoked fish, cookies, the list is endless — can use state-certified equipment, take classes on packaging, marketing and food safety, and prepare their goods for market. Just as it pumps out local delicacies, the incubator is designed to pump out new businesses.

Getting to this point has been arduous. Ms. Raiola first approached the town in early 2010 after the town council began marketing the building, and received a warm reception. Though town officials have supported it, seeing it through in other areas hasn’t been as easy. Ms. Raiola tried, but failed, to get financing from the state Economic Development Office, and over the past year has faced a host of town council, zoning board and planning board meetings. Currently, it appears the project will be funded with a loan from the United States Department of Agriculture, and a bridge loan from Bank of Newport.

Meanwhile, town solicitor Anthony DeSisto is working with Ms. Wells to write the specifics of the memo of agreement; however, a draft form exists and was presented to the town coucnil last month.

Under the draft agreement:

• Hope and Main will establish a board of directors with at least two positions for the Town of Warren (one from town staff, and one from the Economic Development Board). Additional board members would include industry experts, business leaders, and the like.

• Hope and Main will enroll “incubatees,” as they’re called, for three years. After that incubation period, Hope and Main will encourage them to launch or “graduate.” Hope and Main and the town will define financing opportunities to support incubatees, and could offer such assistance as local micro-enterprise loans, to graduates.

• The town would presumably lease the property, rent-free, for a term of 65 years. In year seven, Hope and Main will evaluate the potential for a PILOT (Payment in Lieu of Taxes) program.

• Also after seven years, Hope and Main would have the right to purchase the property at full market value.

• In return for the lease, Hope and Main will assume all operating expenses of the building and grounds, estimated to be $25,000 per year. Though the property itself will be tax exempt, tangible taxes on equipment are expected to be $10,000 per year.

The agreement, she said, could include an open-ended, rent-free provision that will be re-visited every seven years. If Hope and Main officials ever want to buy the school from the town, she said, they’ll pay fair market value for the building. Though the arrangement is rent-free, Hope and Main will spend considerable money updating the building, including installing a $110,000 elevator to bring the old structure into compliance with accessibility laws. Also, Hope and Main will maintain it.