Frankly, it’s flat-out amazing anything ever gets built in Boston, given the apparent utter incompetence of City Hall’s development review bureaucracy.
Sound a bit harsh? Well sit yourself down and read the recent, devastating KPMG audit of the Boston Redevelopment Authority and then tell me how you feel.
As a reporter, I’ve dealt with the agency for years. But whatever residual respect I had for the BRA is fading fast. Aside from talented planners, the rest of the agency seems better suited to be a political rubber stamp than a fair, efficient and even-handed regulator.
The agency has one of the most important and complicated jobs in city government, overseeing the projects and new developments that are reshaping Boston, while simultaneously, at least in theory, earning revenue from a sizable portfolio of commercial property of its own.
Yet the BRA has no coherent record-keeping system. There’s no way of even tracking whether it’s getting paid rent and other fees, let alone whether developers are living up to their promises to various neighborhoods. It’s safe to say the quasi-independent, agency, which boasts constantly that it’s self-supporting, is letting millions in potential revenue go uncollected or slip through the cracks.
Nor did BRA officials particularly seem to care about being so stunningly clueless, at least until Mayor Marty Walsh took over and ordered up a review.
Why The BRA Mess Matters
It would be nice to be able to write off the BRA as just another city department gone awry, but developers and others in the real estate business don’t have that luxury. Whether you like it or not, if you want to build a project of any size or significance in Boston, you are going to have to go through the Boston Redevelopment Authority.
And the BRA, in turn, has developed a reputation as a slow-moving behemoth, taking years to move some projects through the pipeline. Some of that may have been political – developers who fell out of favor with good old Mayor Menino often found they suddenly couldn’t get their phone calls returned, let alone getting the permits they needed to build.
But after reading the KPMG audit, it’s also hard not to suspect the agency’s notorious sluggishness may also boil down to not having enough money to do the its job. Self-sufficiency has meant the BRA can only do as much planning and permitting as its budget permits, the audit notes.
“Currently, it appears as if available funding is driving strategy [that] may be limiting the organization’s ability to effectively carry out its mission,” the auditors write. “For example, currently the amount of planning that can be undertaken within a particular year is limited by the amount of funding that is ‘budgeted’ for planning purposes.”
Stunning Revelations
So how bad is the BRA?
For starters, an agency in charge of crafting and monitoring countless deals with developers – from money pledged for affordable housing to whether it even gets built – has no true central document center. Various agreements are stashed away in the legal department in various paper files – apparently the computer age has yet to dawn over on the ninth floor of City Hall, according to the audit. There’s also no effective system for monitoring these key documents to make they don’t get trashed or stolen – not even a numerical one.
And there’s been no effort to extract from these documents the key points – deadlines and commitments various developers have agreed to.
This is not about legalese, but rather deals involving payments developers have agreed to make to the agency, often in the hundreds of thousands, and, in some cases, in the millions.
The auditors did not go through every single development agreement, but picked a few out to test, and the problems found from this sampling of a few projects suggest they are just the tip of the iceberg.
One Fenway developer owed $600,000 in payments to the BRA as of the beginning of June, payments that were due almost a year ago. In another case, it took years for the BRA to catch up with $1.3 million it was owed by one of its commercial tenants, a combination of rent and equity participation triggered by a refinancing of the property.
Meanwhile, the BRA, which owns the Charlestown Navy Yard, has no “comprehensive listing” of deed restrictions on the buildings and properties it owns, KPMG finds. Given the restrictions trigger payments of as much as 2 to 4 percent of full value when a building or condo is sold, we are talking about serious money here for the BRA. But without a list, KPMG wasn’t able to test what money, if any, the agency is collecting.
And that’s not even the half of it.
There are valuable parking lots at Bunker Hill Community College the agency owns and gets no money from. Certainly hundreds of thousands, if not millions, in untapped revenue. There are also millions in overdue lease payments on other properties across Boston owed to the BRA and its sister agency, the Economic Development Industrial Corp.
And when it comes to getting rid of the deadbeats, the agency is a real loss, with no formal eviction procedures, according to the audit.
Of course, some developers likely made out in this porous and corrupt system, happy not to follow through on payments. It’s the same with any corrupt system – a few well-connected winners and lots of unhappy losers.
Mayor Walsh has certainly thrown down the gauntlet with this scathing audit. Now it’s time to follow through.
Email: sbvanvoorhis@hotmail.com
