Poor poor pitiful door: Part 3, Hunting for culprits

September 16, 2014 | Apartments, Condominiums, Development, Discrimination, Economics, GAIA, Housing, Inclusionary zoning, Journalism, Linkage, London, Markets, New York City, Rental | No comments 66 views

[Continued from yesterday's Part 2 and the preceding Part 1.]

By: David A. Smith

In yesterday’s Part 2, I laid out the arguments made, chiefly by keyboard crusaders masquerading as reporters, that ‘poor doors’ (separate entrances in a mixed-income building for affordable housing renters) are demeaning, discriminatory, and in general un-American.

crusaders_moslems

We’re from Christendom and we’re here to help you

Sources used in this post

Steve Cuozzo, New York Post (August 27, 2013, a year ago; brown font)

The Guardian (July 25, 2014; black font)

New York Times (Ginia Bellafante; July 25, 2014; blue font)

Slate (July 29, 2014; slate-gray font)

New York Post (July 28, 2014; green font)

Which immediately raises the question: if they’re so inherently offensive, why are they designed and built?

C. Who’s responsible for these ‘poor doors’, anyway?

Whether they are harmless or dignity-crushing, separate entrances don’t happen by accident – somebody built the property, somebody designed it, and somebody approved its design.  Whose fault is it?

bluestone_unmasked

Now we’ve unmasked the real villain!

C1. “Developers are responsible because they’re greedy”

When writing a GAIA story, always start with the easiest to demonize, and who more so than the developers:

Some are coy about the subject. Native Land, which is currently building Cheyne Terrace just off Kings Road in Chelsea, complete with a swimming pool and gym, refused to comment when asked if its 13 affordable housing units would be accessed via a separate door.

However, the website of John Robertson Architects, which has designed the building, makes it clear this is the case.

j_accuse_abel_ganz

You have been found out!

Evidently John Robertson Architects didn’t get the message that poor doors are inherently offensive, but as they are architects, not developers, they were given a journalistic free pass.

In a bid to ease the housing crisis, developers are obliged to provide a set proportion of affordable homes when they draw up a new project, but they are often able to negotiate this figure down with local planners.

As I’ve previously posted, inclusionary zoning that is zero-sum (such as the UK’s Section 106) create a nasty bilateral negotiation that often stalls properties indefinitely, because every pound surrendered (in the form of additional affordability) is just economic deadweight; there’s no compensating benefit.  That’s why London’s rate of new inclusionary-zoning affordable-housing development is so slow, and also why the capital has such a housing shortage. 

london_housing_shortage

We have no idea why we’re not building what we need

london_house_prices

But we do know that prices are rising faster than is good for us

When the inclusionary-zoning has a compensatory benefit (or even, occasionally, is positive-sum), the dynamics are quite different:

Extell is including the rental units:

1. To get a tax abatement [Section 421a – Ed.], and also

2. To tap a city-sponsored bonus which would allow it to construct a larger building than zoning allows.

(In fact, Extell opted not to apply the floor-space bonus at 40 Riverside, but instead to it hold it in reserve for possible sale to another nearby site — as is perfectly legal.)

Portaging the density bonus from the subject site to a future site implies two revealing economic things:

1. Extell believed that the bonus density would be more valuable elsewhere and by further inference concluded that more apartments on the Riverside site would overbuild the submarket.

2. Extell didn’t need the extra height/ apartments on the Riverside site to make the numbers work there.

For a developer, everything is about the arithmetic, in particular the market price:

A developer erecting a structure with $3 million apartments is going to worry, not irrationally, that those apartments will be less marketable if they are next door to those renting for $1,000 a month.

C2. “Rich people are responsible because they’re snobs”

arm_hair_in_rolex

It’s hell being rich

Because a developer’s profits (and indeed, its ongoing viability) depend on judging what the market will market, they become sensitive to market perceptions:

As the London housing market has boomed the expectations of some of the capital’s wealthiest homebuyers have grown and many properties now have communal areas akin to those in some of the world’s best hotels.

Indeed, developers – especially those with a single focus of profit – may become hypersensitive to those market perception, and pre-emptively eliminating anything that might be even a momentary distraction to the high-end proposition:

“When Ken Livingstone left office he was keen that all developments should have their social housing ‘pepper-potted’ – mixed in with all the other more upmarket accommodation,” said Ed Mead, a director at estate agent Douglas & Gordon which sells upmarket properties in central London. “This didn’t go down well with developers with the result that most developments now have a separate entrance and a different look.”

ed_mead_keys

Saint Peter with the kingdom of London?

That has to be principally because some people will choose to spend their money elsewhere than will other people.

The [market homeowner] lobby is out of bounds to some of those who live in the building.  The brochure doesn’t mention a second door, with a considerably less glamorous lobby, tucked away in an alley to the side of the building, alongside the trade entrance for Pret-a-Manger. This is the entrance for One Commercial Street’s affordable housing tenants.

Yet that is basic logic; between glamour and cost, a rich person may choose the glamour; a middle-income person will save the cost. 

As nearly the entire Upper East Side from Lexington Avenue to Fifth can lay testament, rich people like to live among rich people.

Because like likes living with like, top-end homeowners want assurance of security:

The Riverside development is unusual, and even vaguely radical, in the sense that its luxury units are condominiums rather than rental apartments.

Typically, buildings like it, which combine market-rate and affordable units, offer none of them for sale.

Combinations of owned condos and rented affordable apartments are more common in London than in New York.

yucky_face

What I think of poor people

It isn’t simply that rich people find poorer people yucky, though in some cases that will certainly be true, but that owners typically prefer living among other owners, out of the belief that this arrangement best protects the value of their asset. Renting has the taint of transience, diminished stability and so on.

We’ve seen that homeownership changes behavior, usually for the better; that people in living clubs (like co-operatives) become quite familiar with each other (perhaps too familiar, to judge by the income-certification police). 

There is also a socioeconomic gulf:

In this case, a building in which apartments are trading at $2,000 a square foot will also contain 55 apartments for households earning $35,280 to $50,340 a year. (At the top range the household must contain at least four people.)

In fact, let’s put those figures in context.  Assuming a 1,250 square foot condominium flat, with 20% down and a 30-year mortgage loan at 5.0%, the debt service alone will be $10,750 a month; add to that condo fees (including reserves) and real estate property taxes, and the net payment is $12,000 a month or more; meanwhile, if we use 30% of income for rent, the affordable households will pay between $880 and $1,260 a month, or an average of roughly $1,070.  That is, the market tenants – condo buyers – will pay roughly 11x as much as the affordable residents, and even if we assume that the affordable residents remain houselocked as long as possible – knowing a fantastic deal when they see it – they’re unlikely ever to blend economically.

In north-west London the developers behind Queen’s Park Place are more upfront about how its 28 affordable and 116 market-rate homes [20% affordable, 80% market – Ed.] will co-exist – its marketing website says the external appearance will be uniform across all properties – or “tenure blind”.


blind_seer

Everything looks the same to me

I suspect some of this is legally-required disclosure in the UK (which is a good thing; it is always better to be clear).

Inside the building the two types of resident will be treated very differently: “Affordable tenants will not have use of the main private residential entrance, private courtyard gardens or basement car and cycle parking. Services including postal delivery and refuse storage are also divided.”

Why then do the poorer people put up with it?

C3. “Poor people are responsible because they’re choosing what they wish to pay for”

Peter Allen, sales and marketing director for Londonewcastle which is behind the Queens Park Place development in north London said housing associations were sometimes unable to pay for all of the facilities covered by service charges. “The simplest way from a design perspective is to have things separate.”

peter_allen_londonewcastle

Allen likes keeping things simple from a profit perspective

“Affordable accommodation is managed separately by Network Housing who have full control of the services and facilities provided to its tenants, said James Moody of Redrow London –

This too is common in the UK: the market portion is managed by a conventional rental agent/ manager; the affordable piece by an affordable-housing manager.

“– and have a set cap for service charges.”

Unless there’s a government subsidy [Fat chance – Ed.], the ongoing service charges – that is, charges for non-residential amenities – have to be paid for by the residents themselves. 

Service charges to maintain these are high, and a separate entrance means housing associations and their tenants do not face these extra costs. However, as in New York, there are concerns that it is leading to increasingly divided communities.

whammy

Double your whammy?

Note the double-whammy of journalistic equivalence, where via an immediate ‘however’ an economic reality is negated by a social possibility in an anonymous passive-aggressive voice (‘there are concerns’).

passive_aggressive_watch_out

Notice too how an inclusionary measure – one that successfully brings affordable housing into a neighborhood where the Law of Economic Pressure would otherwise be completely priced out of that rapidly gentrifying location – is presented as implicitly exclusionary (‘increasingly divided communities’) because of a feature not of the apartments themselves, but of their manner of entry.

[Continued tomorrow in Part 4.]

convert this post to pdf.
PDF Creator    Send article as PDF   

Poor poor pitiful door: Part 2, Presumption of offense

September 15, 2014 | Apartments, Condominiums, Development, Discrimination, Economics, GAIA, Housing, Inclusionary zoning, Journalism, Linkage, London, Markets, New York City, Rental | No comments 68 views

[Continued from yesterday's Part 1.]

By: David A. Smith

Yesterday’s post introduce the ‘poor door’, the catchy pejorative term for a mixed-income residential property, typically built under an inclusionary zoning program (such as London’s Section 106 or New York City’s 421a), where the market residents (who may also be owners, not renters), have a different building entrance (and even street address) that the affordable residents, who are always renters.

rex_theatre_colored

An input to discrimination, or its output?

The facts about the development at 40 Riverside Boulevard, as well as its peers in London, highlight another feature of a good GAIA story – whatever terrible thing is being discussed has already happened, so there’s nothing to do but blame.

Although the building’s configuration is anathema to the values embraced by the de Blasio administration, forcing the developer to abandon it would involve costly, not entirely tenable litigation, which would slow the progress of the city’s affordable-housing plans, the administration said.

Actually, even in New York City that would be a slam-dunk regulatory-takings case (Riverside Boulevard’s development was approved in 2009) that would cost the city a fortune.

Sources used in this post

Steve Cuozzo, New York Post (August 27, 2013, a year ago; brown font)

The Guardian (July 25, 2014; black font)

New York Times (Ginia Bellafante; July 25, 2014; blue font)

Slate (July 29, 2014; slate-gray font)

New York Post (July 28, 2014; green font)

Because the dreadful event is in the past, current officials can safely blame their predecessors – always good political theater – and can rack up political capital by a judicious mixture of deploring the past and promising Sweeping Change in the future:?

This week New York’s mayor, Bill De Blasio, said he planned to take action to prevent new developments being built with separate entrances and facilities for low-income residents.

Truth be told, Mayor de Blasio might be interested in political posturing or political vaporware more than political action.

de_blasio_1981_college_fees

Young Bill de Blasio protesting high college fees, 1981

Multimillion pound housing developments in London are segregating less well-off tenants from wealthy homebuyers by forcing them to use separate entrances.

‘Forcing’? 

forcing_slavery_down_free_soil

Pretty soon you’ll need a civil war to sort this out

Condo buyers will enter through a door on Riverside Boulevard; renters through one on West 62nd Street.

rich_door_poor_door

Separate entrances also mean separate mailing addresses, which is helpful for branding and does no harm; that’s why it’s often seen in (say) combination office-retail-residential, where the use of a street address guides you to the proper door.

While the approval for segregated entrances in just one building in New York generated headlines [Remember, it was the summertime GAIA fix – Ed.], they are fast becoming standard practice in London.

Is there something inherently shameful about using a separate entrance?

B. Are ‘poor doors’ inherently offensive?

In a GAIA story, right and wrong must be so self-evident they needn’t be explained – and by extension, anyone who even tacitly condones such behavior, much less defending it, must be morally oblivious if not worse:

At one building bordering the City financial district, the Guardian discovered wealthy owners accessed their homes via a hotel-style lobby area, while social housing tenants enter through a side door in an adjacent alley alongside trade entrances.

The Guardian ‘discovered’ this – as if it were a secret.

assange_ecuador

And I have more secrets I’ll reveal in due course

The brochure for the upmarket apartments of One Commercial Street, on the edge of the City, boasts of a “bespoke entrance lobby … With the ambience of a stylish hotel reception area, it creates a stylish yet secure transition space between your home and the City streets”.

Commercial Street brochure

Secret marketing documents captured and published here for the first time

These large properties are not mixed-income by developer choice, but by zoning; both London and New York have strong (some might say overly strong) inclusionary-zoning laws.  Not by coincidence, they also have strong anti-development NIMBYite policies, so that if developers want to develop – and sharks gotta swim, bats gotta fly – then they must acquiesce to the inclusionary zoning and make the numbers work if they can.  For this, the best locations require the highest sale prices, which means the richest potential buyers, and as both London and New York are global bolt holes for capital, that means appealing to foreigners seeking a landing pad:

In common with many of London’s new concrete and glass residential blocks there’s a concierge, on hand 24/7 to service the every need of residents paying a minimum of £500,000 – which only buys a studio flat – to live in this booming part of the city.

While accurate, that statement reverses the causality: that part of the city is booming because it attracts richer residents, not the other way around.

Even bicycle storage spaces, rubbish disposal facilities and postal deliveries are being separated.

Imagine having one’s bicycle storage spaces kept apart; why, these beloved two-wheeled pets have feelings too.

bike_outside_bracket

You’re not coming back inside until you apologize to the unicycle

The Green party accused developers of showing “contempt for ordinary people” by enforcing such two-tier policies.

As there’s no profit to be made in contempt, I doubt the developers would invest the energy to have contempt.

simon_disdain

There’s no money to be made in it

This does not just happen where there are large numbers of affordable homes on a site. In Chiswick, The Corner Haus development which is to be completed this summer, has just two affordable units [Out of 14 – Ed.], but these are also expected to have a separate entrance.

Perhaps inspired by the Guardian’s example, Slate went fully over the top.

The new housing units in question are designed to offer tax breaks to developers in exchange for the token gesture of including some subsidized housing in the mix in a world of rising income inequality and increasingly populated world capitals short on affordable housing stock.

Token gestures don’t cost money – building 55 apartments whose capitalized value is well below their cost does.

tokin_gesture

Tokin’ gestures cost money

Green party London assembly member Darren Johnson said: “This trend shows contempt for ordinary people” –

darren_johnson_contemptuous

Johnson is contemptuous of people who feel contempt for ordinary people

– “and is about developers selling luxury flats to rich investors who don’t want to mix with local people.”

Somehow the journalists’ outrage is greater when the public is getting something ‘for free’ (that is, no tax money spent on the benefit) than when it is a direct appropriation or development program. 

James Moody, managing director of Redrow London, which built One Commercial Street said in a statement that his firm was committed to providing homes “at all financial levels” and that 34% of the total accommodation in the building was affordable.

james_moody_redrow

Moody could afford to make one-third affordable

“As One Commercial Street is located on the edge of the City, we have built a product that appeals to this market of young professionals and families who want to live close to their place of work and enjoy the benefits of a full concierge service and hotel style lobby, for which they pay a premium through their service charge.”

Later in the post I’ll return to the service-charge issue.

Through the main door of One Commercial Street the lights shine brightly in the hotel-style lobby. There is luxury marble tiling and plush sofas, and a sign on the door alerts residents to the fact that the concierge is available. Round the back, the entrance to the affordable homes is a cream corridor, decorated only with grey mail boxes and a poster warning tenants that they are on CCTV and will be prosecuted if they cause any damage.

One Commercial Street development

One Commercial Street: showing the inside of one entrance, the outside of the other

[Social housing tenant] Judy Brown had expected to be able to get to her flat through the main entrance. “I call it the posh door. I feel a little bit insulted. It’s segregation.”

On the other hand, perhaps Ms. Brown thought of it as segregation because she was prompted to consider it that way. 

Yes, the design [NB of 40 Riverside in New York – Ed.] necessitated having two entrances. Nothing new there: many buildings around town, commercial and residential, have separate entrances for different users.

For instance, mixed-use properties with offices, hotels, and residential will often have separate elevator banks, and nearly as often separate front doors, if only to provide appropriate gatekeeper/ concierge choices, though this is less true when a property is purely residential.  Nevertheless, for Slate it is all about the symbolism:

The poor door is a clumsy, undemocratic, mean-spirited design solution to an underlying social problem. Those who are lucky enough to qualify for affordable housing don’t need the dignity-crushing daily reminder that they haven’t earned the right to rub shoulders with their very own neighbors.

tank_crushing

This kind of dignity crushing reminder?

[Continued tomorrow in Part 3.]

convert this post to pdf.
PDF24 Creator    Send article as PDF   

Poor poor pitiful door: Part 1, Sudden unmasking

September 12, 2014 | Apartments, Condominiums, Development, Discrimination, Economics, GAIA, Housing, Inclusionary zoning, Journalism, Linkage, London, Markets, New York City, Rental | No comments 109 views

By: David A. Smith

Griffin Mill: It lacked certain elements that we need to market a film successfully.
June: What elements?
Griffin Mill: Suspense, laughter, violence. Hope, heart, nudity, sex. Happy endings. Mainly happy endings.
June: What about reality?

The Player (1992)

Reality doesn’t sell newspapers

For newspapermen, there must always be column-inches even if there is too little news to justify them, and it is in the long slow days of summer, when the chattering classes are on their island or woodland vacations, that there appear the Summer Stories, which invariably have the following journalistic elements:

A God-Ain’t-It-Awful (GAIA) story

Relevant features

·         Shelf life.  The issue’s been going on for some time, so it can be discovered whenever space is needed.

·         No immediate change possible, so the reader need only deplore, not act.

·         Obvious bad guys, preferably those who do not advertise in our paper: rich people, corporations, and rich foreigners are often good ones.

·         Good guys who are ‘like us’, or people that we want to think are like us. 

·         Anecdotes and pictures, not numbers, because numeracy doesn’t sell paper.

·         Easy to condemn.  Journalists are good at condemning things, not so good at proposing viable solutions.

·         Tweet-friendly.  A subject where the less the reader knows, the worse it sounds.

I call them GAIA stories: God, Ain’t It Awful. 

god_help_us

Ain’t it awful?

A Guardian investigation has discovered a growing trend in the capital’s upmarket apartment blocks – which are required to include affordable homes in order to win planning permission – for the poorer residents to be forced to use alternative access, a phenomenon being dubbed “poor doors”.

In media terms, the name ‘poor door’ is inspired – it’s short, catchy, descriptive, and normative – perfect for a summer GAIA story.

so_terrible

A GAIA story must always have a judgmental lead:

Even as so many crises roiled the world recently, the news that a development on the Upper West Side of Manhattan would proceed with a brand of distasteful social engineering still managed to command international attention.

So, Mister Mayor, what are you going to do about it?

de_blasio_progress

I’m gonna make progress, of course

Sources used in this post

Steve Cuozzo, New York Post (August 27, 2013, a year ago; brown font)

The Guardian (July 25, 2014; black font)

New York Times (Ginia Bellafante; July 25, 2014; blue font)

Slate (July 29, 2014; slate-gray font)

New York Post (July 28, 2014; green font)

For New Yorkers, few subjects are more reliable for summer GAIA stories than residential real estate, because everybody lives somewhere, everybody thinks they’re paying too much, and everybody wishes somebody would do something about something.

somebody_do_something

That’s how to sell papers

A. The sudden unmasking of ‘poor doors’ in mixed-income properties

[Of course, New York’s housing is so expensive because New York’s development and regulatory ecosystem is thoroughly dysfunctional and deeply entrenched. – Ed.]

entrenched_pasay_1899

You want genuine reform?  Then come and get it!

The mayors of New York City and London are currently caught up in a social and design controversy that has touched nerves on both sides of the Atlantic: the practice of building separate entrances for poorer residents of new inner-city housing units.

[It’s a measure of just how much perceptions have changed that ‘inner-city’, which used to be a code word for ‘dangerous minority neighborhood’ now is read to mean ‘hot redevelopment area.’ – Ed.]

Slate went to town on the purple prose.

It’s too late to correct what is seen by many as a distasteful, possibly sinister [Possibly sinister? – Ed.]

simon_bar_sinister

Bar Sinister? Never

– social blunder on Riverside Boulevard.

GAIA stories, with their emphasis on a fast-splash across the headlines, are the natural output of broadsheet journalism, whereas blogs, unbeholden to city desk editors and circulation managers, can go as deeply as they choose into subjects as arcane as may interest their obsessive author.  So take a deep breath (or plan on coming back for subsequent installments), because there is actually quite a lot to say.

khao_lak_wreck_scuba

We’re going exploring as long as you have breath

When housing markets superheat, land values skyrocket (especially those where the current property is vertically obsolete), and the combination enables progressive urban governments to deflect some of that rising land value into affordable housing through inclusionary zoning or linkage payments – and then the issues arise.

“Separate entrances doesn’t sound good,” acknowledges Gary Barett, president of Extell [Developer of 40 Riverside – Ed.]. In fact, demagogues can use the words to draw an insidious, and absurd, parallel to the racist old South.

separate_but_equal_fountains

Instinctively unfair, at least to modern eyes

Equality of opportunity is so deeply embedded in modern American consciousness that ‘separate but equal’ is reflexively called discriminatory, but what about unequal?  Must they be integrated … in private property?

This seemed to provide more evidence that living in Manhattan has become increasingly like a flight to Houston in which one is made to board in Zone 4 and eat only stale pretzels.

[Oh, the horror, the horror of having to board with the ordinary people. – Ed.]

brando_dying_horror

Zone 4 boarding … the horror …Zone 4

In Manhattan, the New York Times reports on the Extell Development project on the Upper West Side at 40 Riverside Blvd., which won permission to build separate entrances that will keep its lower-income apartments neatly segregated from its market-rate condominiums thanks to a Bloomberg-era zoning law.

gary_barnett_extell

Is she gone yet?  Extell’s Gary Barnett

As that original New York Times article was insufficiently simplistic for the Guardian’s author Hilary Osborne, she helpfully provided her GAIA gloss:

Mayor Bill de Blasio has said he is in favor of banning the practice going forward (even if he voted for it as a councilman), vowing to reverse the zoning laws that made it possible in his effort to increase affordable housing in Manhattan.

Later in the post I’ll return to the curious recursive logic in seeking to increase affordable housing by reversing the zoning laws that made possible of new affordable housing in super-hot locations.  For now, watch the politicians spinning like tops:

spinning_top_inception

In reality, thins wobble, don’t they, Mayor de Blasio?

Mayor Bill de Blasio and other officials denouncing “poor door” entrances for subsidized tenants in luxury buildings actually voted in favor of a measure that made such separation possible, a Post review found.

When the lengthy text of a zoning resolution was amended by the City Council in July 2009, then-Councilman de Blasio — who arrived late to the meeting — was among the majority who voted “Aye.”

deblasio_swaying

I voted yes but I didn’t know everything that was in it

Though this was a cheap shot by the Post – the legislation was a 104-page zoning change – the Post’s tactic became justified by the mayor’s spokesperson’s reflexive/ deflective response:

take_responsibility_blame_dog

I follow the cat’s honor code

The previous administration changed the law to enable this kind of development,” City Hall spokesman Wiley Norvell said last week.

Ooh, it was that evil previous administration which clouded Mr. de Blasio’s mind into voting Yes.

evil_starts_young

Vote yes, or else

[Continued next week in Part 2.]

convert this post to pdf.
Create PDF    Send article as PDF   

Oh, THAT money we were supposed to collect: Part 4, “The BRA? That’s me!”

September 11, 2014 | Affordable Housing, Audits, Boston, Boston Redevelopment Authority, BRA, City Government, Corruption, Development, Eminent domain, Housing, Inclusionary zoning, Linkage fees, Local issues, Martin J. Walsh, Politics, Thomas Menino, Urban planning, Urban renewal, Zoning | No comments 67 views

[Continued from yesterday's Part 3 and the preceding Part 1 and Part 2.]

By: David A. Smith

menino_claps

“The BRA?  That’s me!”

As we saw yesterday, the BRA had no internal accountability (of its employees, who were never performance-reviewed), and no external accountability (to its stakeholders, who were cowed into silence). 

Sources used in this post

The KPMG audit of the BRA’s procedures (July 11, 2014; blue font)

The Boston Globe (July 17, 2014; black font)

The Boston Herald (July 17, 2014; red font)

Boston Herald (September 6, 2014; green font)

For my very long February, 2014 post on everything wrong with the BRA, see Part 1, Part 2, Part 3, Part 4, Part 5, Part 6, Part 7, Part 8.

Appalling as these failures are, they are logical outcomes of the next failure:

green_arrow_failed_city

Not that we’re making judgments

F. The BRA had no strategy (no goals, no objectives)

Instead of a plan, the BRA depended on pleasing its patron, the mayor.

The audit did not make any mention of Menino, but many of the failures it uncovered focused on development deals made during his tenure.

When your whole existence depends on pleasing one person, there’s no need for job manuals:

While the Manual does contain certain job performance and evaluation criteria, when asked, virtually all of the employees at the BRA/EDIC have not had their job performance evaluated in many years or at all to determine whether individuals have been performing at, above or below expectations.

Why bother to evaluate?  As far as I can tell, Mayor Menino never sought to have anyone removed from the BRA; he just froze out anyone who wasn’t part of the development-approval process, and since the BRA was making money off its developer extractions, goodness knows how many people are rattling around its offices doing, essentially, nothing of value. 

Instead of a strategy, the BRA operated at the mayor’s whim, and nothing better illustrates that whim than a story the retired mayor told, with great pride, just last week:

spaulding_rehab

Neighborly in Charlestown, but definitely in Boston

He brightened, asking, “Have you seen the playground next to Spaulding (Rehab Hospital), over in Charlestown? That’s one of the last things I did. Spaulding is a very special place to me; I spent a lot of time there (eight weeks) when I was sick and saw a lot of things that really touched me.”

“So when they opened the new Charlestown building I was standing on the fifth floor with (hospital president) David Sorto, and I saw this little piece of land right next to it.”

david_sorto

Trying to save lives but needing the BRA: David Sorto

“I said, ‘David who owns that?’ He said, ‘The BRA owns it.’

“And I thought, ‘The BRA? That’s me!’”

That’s a telling admission now, isn’t it?

“So when I got back to my office I called (former BRA director) Peter Meade and told him, ‘We’re going to build something special for some special kids.’ ”

spaulding_playground

How many affordable homes do you see here?

That’s what they did, constructing Boston’s first Universally Accessible Playground in what used to be known as Drydock 5 in the old Charlestown Navy Yard. It opened 10 months ago.

It’s a fine playground – but what on earth is the Boston Redevelopment Authority, an entity which controls all development in Boston, and which is dedicated to economic development and affordable housing, doing spending its money for a playground?  It’s being “me” as in “Me-nino.”

“You’ve got to see it,” Menino said. “Kids in wheelchairs are riding on merry-go-rounds. It’s amazing.”

And that, as much as anything, is why Mayor Menino’s BRA failed: because the BRA had no plan, no scale, no vision … and no independence to develop any of those things.

bra_chronicle_of_descent

G. The BRA had no independence

Golden, whom Walsh appointed as acting head of the BRA, said that failure to monitor agreements and follow commonly accepted business practices is pervasive within the agency.

“We don’t have objectively clear standards that ensure fairness for everybody we do business with,” Golden said. “If you have no rules, by definition you are operating in an arbitrary universe.”

A Tom Menino universe.

Screen shot 2011-11-11 at 9.10.14 PM.JPG

Do we have a gummint of laws or of powah?

Wait, don’t answer that

To this day, Mr. Menino has no idea that his ego run amok and the thin skin that came with it combined to ruin the BRA.

“I told myself when I was leaving that I would not be critical of the guy who took my place. I remember admiring George H.W. Bush; you never saw him in the papers, making comments, after he left the White House.

“And I wanted to be like him. I wanted to stay above it all.”

Researching this piece, I found this ex post facto indictment:

Menino, while near-universally adored by Boston residents and beyond most often with their best interests at heart, never fully grasped the notion that his stranglehold finger on the pulse of Boston was sometimes, however unintentionally, a play to his own ego.

It was always a play to the mayor’s ego, which knew no bounds:

menino_first_pitch

I’m the first mayor to bring a World Series championship to Boston three times!

For Menino, he was always bigger, a larger than life figure, than the city and those he represented. In terms of development and policy, it was always about who would partner and collaborate with Mayor Menino, not who would partner and collaborate with Boston.

Even today, Mr. Menino thinks himself the paragon not only of virtue but also of competence:

He (Marty Walsh) has a tough job and the last thing he needs is me looking over his shoulder. It’s so easy to be critical in politics and in life. Me? I’m on a victory lap.”

Now that Mayor Menino has retired, others in the BRA should do so:

At the current time, the BRA/EDIC operates with many key long term employees that are able to or will be retiring soon.  

The loss of personnel with historical knowledge coupled with documentation deficiencies, the lack of succession planning and the lack of cross training of employees will present the organization with some tremendous challenges when these employees depart.

Nonsense – it will be a great opportunity to create a BRA that is beneficial to the city of Boston – and to ask the more pertinent question, Does Boston actually need a BRA?

H. The BRA has had no net beneficial impact on Boston

The BRA is a one-entity land cartel – the OPEC of real estate development in Boston.  For four decades, no increase in Boston’s built-environment-density has been possible without the BRA’s approval – and for half that period, a time that could have offered transformative potential to the city, it has been used as a personal development arm of a single individual.

The audit clears the way for Walsh to launch a wholesale restructuring of the agency, which the mayor had promised during his campaign last year. He had held off until the accounting firm KPMG LLP finished its audit.


The city has grown, but has the BRA helped that growth or shaped it for the better?  As far as I know, no one’s undertaken a comparative study of Boston’s growth versus (say) Philadelphia.  For that matter, in terms of development, Cambridge has done much better than Boston; Kendall Square has boomed under its redevelopment authority.

cambridge_1978

Kendall Square, 1978

Can Boston (just across the river, top of each picture) claim to have done as well as Cambridge?

cambridge_2005

Kendall Square, 205

“If you look at its history, the BRA has created one of the great cities of the world and that has benefited the people who live in it,” Golden said.

Aside from the arrogance of that statement, which reeks of you didn’t built that, it at best confuses causation with correlation.  What, exactly, has the BRA done to enable development, as opposed to simply capitalizing on the rising Boston economy, which the BRA has nothing do to with?

“But it’s really hard to convince people of that when you’re looking at a mess like this.”

It’s entirely possible that the BRA has, in fact, retarded Boston’s development for two decades out of mayoral pique and authority craven obeisance.

downey_full_retard

You should never retard development

Golden, the agency’s acting director, acknowledged it will take months to reshape the BRA and establish new rules for reviewing projects and enforcing developer agreements. But he said the agency is worth saving.

People think the BRA is benevolent – it’s a government body, it must be benevolent, mustn’t it? – but there’s no evidence of this other than the BRA saying so.

[Mayor Walsh] is also bringing on a team of compliance officers and wants another audit by a different firm to probe deeper into some of the planning issues at the agency.

At least Mayor Walsh knows he’s got a deep pit to dig.

walsh_shoveling_chinatown

It’ll take a lot more digging than that, Mr. Mayor

He has already stripped the BRA of control of a $20 million fund for affordable housing that is financed by fees on developers. Another city agency, the Department of Neighborhood Development, will now administer those funds.

If we have a DND, we don’t need the BRA to manage affordable housing.  Why stop with fee administration – why not strip the BRA of anything to do with affordability covenant oversight?

Brian Golden, the BRA’s secretary and executive director under former Mayor Thomas M. Menino, who is now heading the BRA under Walsh, acknowledged that the agency “is a mess.”

“The BRA needs to develop acceptable business practices for most of its major operations,” Golden said.

Readers will recall that Mr. Golden claims he had no idea of the organization’s failures and lack of acceptable business practices, despite being the number two man on the totem pole.

wagner_number_two

But that was the side of the city I didn’t see

As the organization’s number-two person, what areas were those Mr. Golden previously managed?  Here, courtesy of the BRA’s Web site, are his duties:

Brian Golden was appointed Executive Director/Secretary of the BRA in 2009.  In his position, he manages the process by which the BRA/EDIC Board reviews development proposals and the decisions regarding them. 

Up to now, Mayor Walsh has been reserved and even-tempered; now it’s time for him to demonstrate anger, not by words but by decisive actions.

Walsh said Wednesday that Golden will remain acting director for the “foreseeable future,” but he has not made any final decisions about the future of the position.

Mr. Golden cannot be part of the solution because insofar as he knows anything about cities and urban planning, he learned it at an authority that by his own admission is a mess, in which he was the second in command and yet was miraculously not responsible for any of the mess.

Clean house, Mr. Mayor.  Find out how much has been forgotten, lost, wasted, pilfered,

You want to turn around the BRA?  Go get Joe Tulimieri; he’s eminently qualified, having run the Cambridge Redevelopment Authority, and he’s available.

joseph_tulimieri

Tanned, rested, and ready: hire him, Mr. Mayor

convert this post to pdf.
PDF Converter    Send article as PDF   

Oh, THAT money we were supposed to collect: Part 3, An abject mess

September 10, 2014 | Affordable Housing, Audits, Boston, Boston Redevelopment Authority, BRA, City Government, Corruption, Development, Eminent domain, Housing, Inclusionary zoning, Linkage fees, Local issues, Martin J. Walsh, Politics, Thomas Menino, Urban planning, Urban renewal, Zoning | No comments 71 views

[Continued from yesterday's Part 2 and the preceding Part 1.]

By: David A. Smith

No transparency, no records, no tracking systems – is it any wonder that the Boston Redevelopment Authority (BRA) has been leaving money on the table, and agreements unenforced or even unmonitored?

homer_asleep

Just collecting the overtime, sir

Sources used in this post

The KPMG audit of the BRA’s procedures (July 11, 2014; blue font)

The Boston Globe (July 17, 2014; black font)

The Boston Herald (July 17, 2014; red font)

Boston Herald (September 6, 2014; green font)

For my very long February, 2014 post on everything wrong with the BRA, see Part 1, Part 2, Part 3, Part 4, Part 5, Part 6, Part 7, Part 8.

As we’ve seen in the two preceding parts of this multi-part excoriation, Mayor Marty Walsh has an enormous challenge on his hands in addressing the BRA, because not only has the BRA been the nexus of every bit of economic development in Boston for nearly half a century, I have yet to find anything the BRA does well.  No BRA process withstands scrutiny; no BRA outcome is benchmarked.

But at least its management and employees are capable … aren’t they?

i_see_stupid_people

Please tell me they’re capable … at least some of them.

D. The BRA had no internal accountability (employees)

“How many people work at the BRA?”

“Oh, maybe half of them.”

Old corporate joke, updated

at_least_you_tried

BRA employee review?

Amazingly, no one actually knows how many people draw paychecks form the BRA and its related entities, because what appears from the outside to be monolithic is actually an agglomeration of entities that have never been integrated:

The Boston Redevelopment Authority (BRA) was formed in 1957 and merged with the Economic Development Industrial Corporation (EDIC), a quasi-government non-profit corporation, in 1995.

Additionally:

1. The activities of the City’s Office of Jobs and Community Services (JCS) (formerly housed in the Mayor’s Office) were added in 1990 under EDIC.

2. The Boston Local Development Corporation (BLDC), a 501(c)(3) non-profit corporation was created in 1978 and is considered an ‘affiliate’ of EDIC.

3. The Friends of Youth Opportunity Boston, Inc. (FYOB), a 501(c)(3) non-profit corporation, was created in 2007 and is also considered an ‘affiliate’ of EDIC and was created to support the activities of Youth Opportunity Boston, a JCS program (now called Youth Opportunities Unlimited).

Beyond those three entities, which KPMG was able to connect to the BRA, it then listed three more as sentence fragments, as if to avoid any responsibility for figuring out how they connect to the BRA, if at all.

stumped_man

We have to finish the report, so just list ‘em

4. The Boston Industrial Development Financing Authority (BIDFA), an industrial development financing authority created in 1971 under Chapter 40D of the Massachusetts General Laws.

5. Boston Connects, Inc., a 501(c)(3) non-profit corporation, created in 1999 to oversee and implement the Empowerment Zone Strategy Plan.  [Apparently now defunct – Ed.]

6. WriteBoston, Inc., a 501(c)(3) non-profit corporation, was formed in 2012 to support the activities of WriteBoston, a JCS program.

It is possible that other affiliates and/or related entities may exist that have not been identified.

EDIC has approximately 120 employees and the BRA has approximately 78.

On the working hypothesis that the average BRA employee makes $75,000 a year, and that the non-employee costs equal the employee costs, that’s at least $30 million in annual running costs (and I found a four-year-old reference to a $50 million budget).  With a thirty million dollar employee compensation and benefits line, you’d expect employee performance to be reviewed annually and in a structured fashion.

urquhart_you_might_think

You might think they would have a system … but you’d be wrong

While the ‘Salary Structure’ indicates that it covers both BRA and EDIC non-union employees, we were provided with little documentation supporting the salary amounts included on that schedule.

Evidently the BRA staff, realizing the auditors’ disbelief, scrounged up a feeble justification:

watson_disbelief

Can’t you do better than that?

We were told that the schedule is based on information extracted from a document titled the “Municipal Position Evaluation Manual” –

Translation: This sounds to us no more than a clumsy fib, as the KPMG auditors carefully explain with non-libelous circumlocution:

– which is undated and therefore may not be relevant in the current environment.

Additionally, the document did not appear to contain any addressee or any reference to the EDIC, BRA or City of Boston.

Translation: there’s no indication it was ever used by the BRA.

Finally, in the Introduction section of the report, the author indicates that the Manual “has been carefully designed to enable a trained person to effectively evaluate and rank all levels of positions found within the health care organization” [emphasis added].

Translation: They didn’t even bother to update the copy.

Without some type of timely job performance review and feedback mechanism, it is unclear how high performers are distinguished from low performers and what rewards/sanctions.

In short, there is no institutional record of what anyone in the BRA does, nor whether they are good at it, nor whether their pay correlates with performance or job responsibilities, nor anything else relevant to employee performance.  And why is that?  Interim CEO Brian Golden, appointed to that role by Mayor Walsh, had this to say:

“The organization historically has paid more attention to its external mission, urban planning and real estate development, than to its internal operations,” said Brian Golden, the BRA’s secretary and executive director under former mayor Thomas M. Menino, who is now heading the BRA under Walsh.  “So decades of this neglect of the internal operation has created an abject mess.”

Even the Globe was skeptical of Mr. Golden’s statement, adding this:

Brian Golden has worked at the BRA since 2009, serving as executive secretary, a top-level position. But Golden said the problems flagged in the audit were in areas he had not previously managed.

not_my_area

Well, what about this area?

In addition to the compliance items noted above, the BRA/EDIC has many other agreements requiring compliance that may or may not be tied to amounts owed to the organization. Many of these requirements are programmatic in nature and systems are not in place to effectively ensure that the requirements are being met.

Perhaps Mr. Golden believes that negotiating the agreements is all that matters, and having them adhered to is unimportant.

KPMG then concludes, as lamely as it must:

The BRA/EDIC needs to begin a process of identifying those employees performing key functions for the organization –

dog_tennis_balls

Are any of these performing key functions?

Good luck finding them.

– identifying a replacement establishing a transition plan to ensure that currently undocumented information gets memorialized.

Such as, all information, as there appears to be nothing actually documented.

E. The BRA had no external accountability (private partners)

Ordinarily one would expect that a public entity failing its responsibilities would be subjected to withering criticism, but such was the BRA’s power over all development that those who knew were too cowed to criticize.

dog_chained

I’m not saying anything

Basically, everyone who did business with the BRA had strong reasons to be silent.  Some people had developed property in Boston, hence they had done business with the BRA, and the BRA’s laxity was reason enough to be silent:

Jeff Wallace of the Zoom Group, which owed the BRA nearly $280,000 in unpaid rent, said the two sides settled for $500,000 of the $1 million owed for past refinancing fees. “The lease was ambiguous on how to calculate a number. It’s a very complicated formula,” he said.

Other people had property in Boston, and wanted to develop, hence they knew they would have to engage with the BRA, and as the BRA followed no rules, no timetables, and no accountability, there were no good transactions or bad transactions, only the mayor’s friends and his non-friends. 

mayor_menino_angry

You wouldn’t like to develop in Boston when I’m angry

So everyone kept silent – everyone, that is, except courageous and stubborn Don Chiofaro, who said in 2010:

“We intend to keep the pressure up until we get honest answers from the person pulling the strings on this process, and we all know who that is,’’ he said –

And when Mr. Chiofaro said that, he was greeted with:

– to stunned silence.

{object}

I’m used to stunned silence

The reason was simple: With the BRA having a unilateral say or veto over any downtown development decision in Boston, every developer of property, and every potential developer of property, knew that to speak against Tom Menino was to assure one’s property would never, ever move forward, even as the mayor would threaten to mis-invent eminent domain to get his way.  Only when Mayor Menino’s power finally waned were some willing to speak:

The audit is validation of critics’ long-held concerns –

Never voiced in the Boston Globe, at least as far as I could ascertain.

 that the BRA approves major building projects without ensuring developers follow through with promised community benefits, such as building more affordable housing.

We were all silent sheep.  Some of us were more cowardly sheep than others.

sheeple

It’s not my issue

[Continued tomorrow in Part 4.]

convert this post to pdf.
PDF Printer    Send article as PDF