Audit: Boston Redevelopment Authority? Kinda more like Broken Redevelopment Authority

An audit of the BRA found an agency still tracking billions of dollars worth of project on paper, unable to say if developers are building or paying for the affordable housing they committed to and losing out in millions of dollars in revenue on back rent on property it owns and on fees developers are supposed to pay when they refinance BRA-approved projects.

Mayor Walsh hired the accounting firm KPMG to take a look at the operations at the BRA and its Economic Development Industrial Corporation, which oversees the Boston Marine Industrial Park in South Boston.

KPMG found companies renting BRA property owe $4.3 million in back rent - with $2.3 million of that being in arrears for more than 90 days. One exception: Bunker Hill Community College, which pays no rent at all on the two BRA parcels it uses for parking lots.

In its report, KPMG said its first problem was just getting the documentation it needed from the BRA to analyze its operations. KPMG found that most critical documents are still maintained on paper rather than electronically, and that, oops, they often go lost, which is no news to anybody who remembers how the owners of the Hancock were able to shut their public observation deck permanently even though everybody knew they'd signed an agreement with the BRA in the 1960s to keep it open.

Poor record keeping in turn led to an inability by the BRA to figure out whether developers fulfill the various promises they make to the authority to win approval, for example, to either build "affordable" housing units as part of a luxury housing project or to pay into a fund to build those units elsewhere in the city:

While a 'Compliance Department' and a 'Compliance Database' do exist within the organization, their effectiveness has been inadequate. The Department has existed since about 2004 and developing and maintaining the database, which is concerned principally with tracking compliance with Article 80 developer commitments, is manually intensive. Finally, the responsibility for compliance with other requirements (leases, affordable housing, etc.) does not fall under the Compliance Department either directly or indirectly. The Compliance Database, similar to the development 'pipeline' is maintained in a Microsoft Access database but the database and pipeline are not fully integrated and, due to the manual updating process, do not always contain consistent data. ...

Over the years, the BRA/EDIC during the normal course of business has entered into and continues to enter into various complex agreements with developers, lessees and other third parties. These agreements outline the responsibilities of both the BRA/EDIC and the counterparty. Accordingly, the enforcement of critical provisions of these agreements is and should be a major focus of the BRA/EDIC. However, there is no effective system in place to ensure that all documents are captured or that all key elements of the agreements are identified and managed to ensure that the counterparty commitments made to the BRA/EDIC are delivered in full and on a timely basis. ...

The BRA/EDIC has historically been responsible for executing [affordable housing] agreements with developers and for ensuring adherence to the agreement by either collecting IDP payments for spending on affordable housing projects around the City or by verifying that affordable housing units were constructed by the developer. Additionally, we were unable to obtain a written policy over how or where IDP funds were to be spent, and the tracking of actual spending was not well documented as BRA/EDIC could not articulate where each IDP receipt was spent in support of affordable housing initiatives. ...

KPMG cites a specific example: The Fenway Triangle Project/Van Ness project:

[The project] was signed off by BRA/EDIC management in June 2013, but it was not captured by the Compliance Department in its database for approximately 10 months. During this 10 month period, construction had started but no evidence of a building permit being provided by ISD to BRA/EDIC could be provided. Under the terms of the DIP Agreement, a payment of almost $300,000 should have been made by the developer to the City Treasurer when the building permit was issued and another $300,000 payment should have been made one year after the building permit was issued. As of June 1, no developer payments have been made, although negotiations are being held with the developer to satisfy all obligations due under the developer agreements. These obligations include the affordable housing contribution and payments supporting jobs and affordable housing. Although we requested a copy of the building permit for this development, one was not provided. The lack of a monitoring system to identify, track and follow up on these types of developer commitments may result in developer funds not being remitted completely or on time to the BRA/EDIC or the City Treasurer. Additionally, the lack of coordination between ISD, the department responsible for issuing key documents (such as, building permits, certificates of occupancy, etc.) and the BRA/EDIC, the entity responsible for monitoring compliance with the developer commitments may result in developer obligations not being enforced.

That project also highlighted another BRA issue, KPMG said: It doesn't have a consistent naming policy for projects:

Add to that the fact the BRA doesn't have a consistent system for naming things:

For example, 1325 Boylston is also known as the Fenway Triangle. Another property is known as either 115 Federal Street or 115 Winthrop Square, while another property is known as P-7a or 240 Tremont St. The lack of a project naming convention can create confusion and make researching information more difficult.

Neighborhoods: 

Topics: 

Free tagging: 

AttachmentSize
KPMG audit of the BRA217.51 KB

Comments

Good on Walsh

Menino seems to have had a special relationship with the BRA and developers in exchange for overlooking poor BRA management.

up
25

who needs money?

By on

The city has plenty of money, never had any problems finding money to put the Mayor's name on things.

up
18

menino?

By on

and people thought tom menino was a good mayor. look at the bra, schools, taxi industry, public unions, student housing, etc. and tell me this guy was an asset to the city for the last 20 years? at the end of the day, menino only cared his and his family member's paychecks, gettting his name plastered on every piece of taxpayer-owned property. thank god he wasn't responible for public transit or the airport. i hope we never hear from tom menino again. he is a disgrace.

up
21

Black and white, huh?

By on

No, he was not perfect. But neither was he evil incarnate.

Schools when he left were better than when he started, although nowhere near as good as he promised. Crime went down, development went up, Boston became a far more welcoming place than before, neighborhood centers came back (look at Roslindale Square).

up
17

but rozzie square is still not even close to its full potential

By on

plus we've got another agency that needs an audit of its land asset management - and that's the MBTA (arborway busyard, anyone? and remember how long it took to get any movement on the substation?). plus - orange line to rozzie square should have happened with the latest capital investment plan - instead they're spending billions of dollars on the south coast rail project for a grand total of 4,000 daily riders. 4,000 riders can be found on ONE of the NINE bus lines that pass through the square. The problem is that the city has no clear vision for multi-modal transportation (and economic development tied to infrastructure improvements) - the only thing even remotely resembling this is their bike network plan - and even that was because there were numerous local advocacy groups pushing for it. We're relying on massDOT and the sporadic recommendations of MPAC for improvements to transit - and MassDOT and the MBTA aren't exactly interested in expansion - they're not in the business of economic development.

anyway - while I do agree that Menino was a good advocate for neighborhoods, he was never really capable of seeing the big picture. Maybe now that economic development is separated out from the BRA we'll finally start seeing some real city planning instead of this piecemeal-reactive approach.

up
18

I agree with you, but

By on

The City can do very little about getting public transit built. Were that the case, Somerville would have built GLX, what, 10 years ago. The MTA made the plans for transit to Roslindale, West Roxbury, Dedham, Hyde Park, and lots of areas in other parts of greater Boston, but what was built was built. At the end of the day, the City could and can only guide the vision of the MBTA with that it did and has been doing with their lots at Forest Hills, too.

Trust me, if you think the Square is falling short, talk to someone who was there in the 80s or even early 90s.

Somerville didn't do anything until 2006

By on

when it finally filed a lawsuit to force the MBTA to actually start moving forward. Boston could have been involved in reviving arborway service on the green line but they've done nothing (do they even want to? who knows). It took rozzie mainstreets to force the BRA to purchase the substation from the MBTA (BRA could have bought it from them a long time ago). MBTA has sat on the arborway busyard for, what, almost 2 decades now - city only did something when the neighborhood rose a stink about 15 years ago - but the city has been completely silent since then. maybe they'll finally ask the MBTA wtf is going on now that the there's talk about completely moving the yard.

plus - the entire city was struggling in the 80s, not just roslindale square. the old-timers have been in crisis mode so long that they think any little extra scrap thrown their way is good. one stop into rozzie is low-hanging fruit - could actually end up saving the MBTA some money in operating costs AND would be a huge benefit for the neighborhood. yet we do nothing and keep saying how things USED to be so much worse.

GLX is a big dig mitigation

By on

Hence the suit. And it still hasn't broken ground.

I'd love to hop on the Orange Line at the Square, despite my love of walking from Forest Hills. I just think that ship sailed during the White administration, if not earlier.

Wow..I guess that explains

..why they were so out to lunch on the micro side with that imbecilic restaurant concept in the dolled up vent shaft structure on Long Wharf.

I have a friend who works there or did and I feel bad for her as she's pretty exemplary and in an unrelated department,

up
12

Menino was a technophobe.

Menino was a technophobe. During his administration, there wasn't upper level support in that administration for the massive investment that digitizing decades worth of records would require.

If only we had a position in

By on

If only we had a position in state government like an "Attorney General" to investigate corruption.

We should petition the governor and legislature immediately to determine why this essential position doesn't exist!

up
26

ombudsmen

By on

I believe the task you are pointing to is usually described as an "ombudsmen". I'm not aware of MA having such a position.

In places where there is an ombudsmen, I believe gov't cowers in fear of their reports. Indeed, citizens read those reports.

Potentially simple solution:

Dissolve the whole thing and start over.

I admittedly don't know the feasibility of this from a legal perspective, and it would be a big undertaking regardless, but it would be 100% worth whatever it costs the city (and subsequently us) in the short term when you think of the big picture.

Obviously there would have to be a freeze on new development, but since luxury condos and the destruction of national parks seem to be all they care about anyway, I think the city could survive.

Being 100% serious, THIS could be Marty Walsh's legacy, and the difference between being a 1-2 term mayor another 20 year run.

up
13

Feasibility

By on

The BRA has to declare that its work is "done" and then the legislature can dissolve it.

As I recall, I think it would actually even be difficult to change the legislation to get rid of it. I believe there's something in there that makes it impossible to legislate it out of existence unless they (the BRA Board) say they are done.

The only way to do that would be for the mayor to put people he trusts on the board with the charge to declare their mission "accomplished" and move to close the organization. It's a real catch 22 - especially when the mayor and the organization collectively are the most powerful force in the city and an incumbent can leverage the BRA to keep him in office for about as long as he wants.

Thanks for the clarification

I wonder if this audit would at least allow him to completely clean house then. Completely dissolving it was a PR-minded thought due to the negative connotation associated with those 3 letters.

It seems as if there could be grounds to at least replace those running it with concrete information from an independent audit, no?

You would think

By on

But just about everything involving the BRA defies all human logic - at least under Menino. It will be a true test of Walsh to see if he does the correct thing or the politically correct (for him) thing.

Agreed

Like I said, THIS could be his legacy. The BRA arguably has more power to affect the future of the entire greater Boston area than any other entity, and from what I gather based on approved projects and general development time frames, it'd take years, if not a decade, for the changes to impact us if everything were fixed TOMORROW.

Something needs to happen sooner rather than later.

up
13

We don't need no stinkin'

By on

We don't need no stinkin' logic. You're all BLIGHTED! Bring on the bulldozers baby!

up
12

What if?

By on

What if they legislate out the part that says they can't legislate it out and then they legislate it out? ...