Chaos and understaffing at the Massachusetts Turnpike Authority has left at least two major Boston development initiatives stuck in the mud, sources tell Banker & Tradesman, as crushing debt, political infighting and a personnel exodus have caused the agency to suspend virtually all major real estate decisions.
"They’re in complete turmoil," said one development source. "There’s nobody home."
"Nothing is happening at all," said another, complaining that development bids from Faneuil Hall to the Back Bay have ground to a halt. "They don’t have anybody in place. Nobody’s in there to make things move."
In the span of one week in early May, the Pike laid off its chief development officer and most of its real estate support staff, and saw its executive director resign amid a firestorm of criticism. Since then, many in Boston’s development community complain they’ve heard nothing but silence from the agency.
In mid-January, the agency announced a dramatic plan to sell off its 11 roadside service plazas. The four bidders chasing those properties are still waiting for word of their fate.
In announcing the service plaza sale, transportation secretary James Aloisi pledged to move quickly to "dismantle" the Pike. He said that, as a manifestation of that commitment, he would dispose of the plazas "in a matter of a couple months," adding, ""We want it expedited. We don’t want it to linger."
That haste seems to have waned. Boston Mayor Thomas Menino recently told Banker & Tradesman that Aloisi informed him that all major real estate decisions are on hold. Aloisi told Menino that the Pike wouldn’t be pulling the trigger on any major real estate leases or designations until Governor Deval Patrick and the Legislature come to an agreement on the troubled agency’s future.
"They’re going through a reorganization," Menino said, referring to the transportation consolidation bill that’s currently stalled in a legislative conference committee. "Once it’s completed, they’ll move forward. Jim Aloisi said to me, ‘Why start the [development] process and not finish it up?’"
An Aloisi spokesman denied that account, saying, "Nothing is on hold."
Other Mass. Delays
The Pike had also been expected to tap a developer for a long-vacant parcel along the Rose Kennedy Greenway in mid-April; a long-delayed request for proposals on the parcel finally went out last October, and bidders are still waiting for the Pike to name a winner.
Bids on a series of Pike air rights parcels in the Back Bay were delivered to the agency in early December, and over the past six months, the development process for those properties has gone no further.
"I’m hearing [the air rights development] is stalled," said city council president Michael Ross. "It’s unfortunate. If done correctly, air rights development has the potential to reconnect neighborhoods and bring vitality to otherwise-dead spots. Good planning takes place during a down economy. We should be preparing today for Boston to come out of this. If we don’t use this time wisely, other cities will, and we will lose."
In the wake of May’s mass layoffs, the Pike is operating with a skeletal real estate staff. All operations are being funneled into the Executive Office of Transportation, which is also handling all real estate planning for MassHighway and the MBTA.
The planned consolidation of the Pike, MassHighway and the T has been hampered, though, by bitter conflict between Aloisi, Patrick, and Senate President Therese Murray. Aloisi has repeatedly thrown barbs Murray’s way, and the Senate president has reciprocated by savaging Aloisi and his boss in the press.
Murray and the governor are also warring over how to pay for the state’s overwhelming transportation bills. Patrick has pushed a 19-cent gas tax increase, which the House and Senate rejected in favor of a 25-percent sales tax hike. The governor promptly threatened to veto that hike, raising the prospect of massive Pike toll increases this summer. A failure to resolve the impasse will likely junk the Pike’s bond rating and trigger costly swaption contracts.
The calendar is also working against the reorganization that Aloisi is reportedly subjugating his real estate processes to. On Beacon Hill, legislators traditionally devote nearly all of their springtime work hours to passing a budget before retiring from the Hill for the summer. The current legislative session has been marked by fewer formal sessions and poorer committee attendance than usual, and those two trends don’t bode well for the prospect of conference committees working overtime.
