Dreams In the Millions.
By Jim Conley • September 30th, 2007 • Email This Post to a Friend •
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The Boston Globe’s City Weekly section (where stenography and reporting are confused) has an item on the Brookline Selectmen/Children’s Hospital lease deal [see story]…now a $75 million project.
Once again, we’re treated to the projection that the office building Children’s is putting up in Brookline Village will render $1 million in new tax revenue to the town.
If that’s true, I guess we don’t need a Proposition 2.5 over-ride.
But I doubt it is true. Look, if you want to take the Brookline Selectmen, their economic development advisory board and Town Counsel Jennifer Dopazo at their word, good luck to you. I’ve seen enough over my six plus years of covering Brookline Town Government to know that if it sounds too good to be true it usually is.
I’ve asked Catherine Cagle, the Town’s economic development director, for the analysis used to peg the tax revenue from the project at $1.2 million. No response. Hey, there’s a great use of taxpayer dollars.
Presumably, the Town has determined the valuation method they plan to use and whether any offsets (like for environmental cleanup) will be factored in to the $1.2 million in so-called rent. Wouldn’t they? So why is it so hard to answer a few simple questions?
And then there’s another wrinkle to the deal (involving the track record of one of the parties) that I haven’t quite figured out how to report on. Fool me once and all that.
Jim Conley is publisher of On Brookline.
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The Boston Globe article states:
“Rent will equal the assessed taxes for the parcel, according to Dopazo. If the hospital encounters construction delays, it has agreed to an additional $1 million in penalties.”
Does that second sentence reflect what Dopazo told the Globe? Penalties are somewhat frowned upon in contractual arrangements under MA law and often cannot be enforced unless they can be justified as damages. I wonder if the final ground lease document contains changes from the draft provided to OnBrookline, perhaps reflecting comments made here and by others.
Also, under said ground lease draft the tenant is a limited liability company, presumably controlled by Children’s, with who knows what assets. Is Children’s a guarantor for payment of this penalty? The devil must be someplace in the details, charitably speaking.
I just read with interest an OpEd by Robert B. Reich titled:
“Is Harvard a charity?” in today’s LATimes available at:
http://www.latimes.com/news/opinion/la-oe-reich1oct01,0,80486.story?coll=la-opinion-rightrail
Children’s Hospital has an affiliation with Harvard. In addition to property tax exemption for charitiable non-profits, there are other tax benefits, including income tax, for not only the non-profits but to its contributors by way of charitable deductions.
I have earlier expressed my view that the property tax exemption for charitable non-profits should be challenged head-on and not by the gimmick of the B-2 sale/leaseback. Reich’s article addresses another side of this issue.