Vol. 4, No. 7
March 29, 2004
Contents
1) ASSEMBLY SQUARE - THE HOME STRETCH?
A) Last Week's Revelations - the Bonz Bombshell
At the meeting on the Committee on Legislative Matters on Wednesday March 24, 2004,
aldermen received the administration's long-awaited fiscal analysis of net tax revenues expected
from the first stage of new development to be secured by covenant at Assembly Square. The
presentation was made by Dick Bonz of Bonz and Company, Inc., Real Estate Advisors. Dick
Bonz has been Steve Cecil's Real Estate expert since Mr. Cecil started consulting Assembly
Square, in 1999, producing the 2000 Planning Study upon which the city still relies.
The results were dismal: the proposed IKEA store was predicted to yield $625,000 per year of
net tax revenue. "Essentially, the redevelopment of the mall is a break-even." As to the
additional development promised on the "Main Street" side of the mall site over the next six
years: "The office use would net approximately $140,000 per year in tax revenue; the residential
is expected to produce a net of approximately $125,000...." We're talking about a total of
approximately $890,000 in net taxes for the entire 42+ acres at Assembly Square north of Foley
Street.
Are "Peanuts" Enough?
To put this revenue figure into perspective, consider that in December 2003, the School
Committee entered into an agreement with the Somerville Teachers Association to sign a new
two-year contract. That contract, signed in February 2004, will increase salaries for School
Department employees by a projected $1,248,000 in FY 2005 alone. Fiscal year '06 will bring
another 2% increase, and the other unions are sure to want no less than the teachers are getting.
Somerville Firefighters Local 76 president Jay Colbert published a letter in the January 29,
2004, Somerville Journal, regarding predictions that too much large-format retail development
at Assembly Square would produce low tax revenues. "'[P]eanuts' is just what we need," argued
Colbert. I can only hope that concrete analysis of taxes and actual city costs will generate a more
realistic discussion of "peanuts" as revenue.
Are these Numbers for Real?
Given the stunned reaction of aldermen to Bonz' revenue projections, I expect that this week we
will see "revised" revenue projections, with much more attractive numbers. How accurate are
Bonz' current numbers? Admittedly, fiscal projections involve both art and science, but Steve
Cecil certainly defended Bonz's conclusions.
My opinion is that, if Bonz's numbers were off, it was in the direction of being rather generous
to the developers. As readers are probably aware, the formula for determining net taxes is to
subtract costs from gross taxes. In the case of IKEA and the mall, Dick Bonz calculated only
costs directly attributed to property operations, principally public works and public safety.
Bonz's rationale for not attributing to these properties any of the city's costs for public education
- between one-third and one-half of Somerville's budget, depending what you include - is that
they add no children to school enrollments. This assertion is true enough, but all other taxpayers
in the city are expected to contribute to the entire city budget, regardless of what services they
themselves consume. The whole point of increasing commercial development in Somerville is
to boost tax revenues beyond what we currently collect and expend.
Information from outside Somerville support Bonz's projections of low net revenue. A study of
a proposed shopping center in Leominster, MA, by a nationally recognized land use economist
found that the development would destroy as many jobs as it created, and provide the city with
only $51,000 in additional revenue. The Institute for Local Self Reliance has been documenting
high costs nation wide for police services to large-format retail, for instance, see:
http://www.newrules.org/hta/hta0903.htm.
B) More Legislative Matters Committee Meetings
The aldermanic Committee on Legislative Matters will meet again to discuss Assembly Square
on Tuesday March 30, and Thursday April 1, 2004, at 7:00 pm, in the aldermanic committee
room or in the Aldermen's Chamber on the second floor of City Hall. The focus of Tuesday's
meeting will once again be transportation. We are also promised revised fiscal analysis with
new, more attractive revenue projections. By the Thursday meeting, we hope to have more
complete drafts of the proposed development covenants with IKEA and ASLP.
The committee will meet again on Wednesday April 7, at 7:00 pm, at which time we hope to
hear from the Metropolitan Area Planning Council (MAPC) as to how well the March 1, 2004,
zoning proposal fits the transportation planning criteria adopted in January, 2004, by the Boston
Metropolitan Planning Organization (MPO). The covenants with developers for the mall and
IKEA sites still call for the Board of Aldermen to vote on the final zoning at its April 8 meeting.
What can an individual resident do?
I encourage anyone who is interested in Somerville's future to investigate both the zoning and
the covenants. At its March 18 hearing on the new zoning, the Board of Aldermen left its public
comment period open until April 2. Comments may be sent to the Board officially via
City Clerk John Long, who is also Clerk of the Board.
2) ZONING BOARD HEARS CRUCIAL NEIGHBORHOOD CASES
On March 29, 2004, at 6:00 pm, the Zoning Board of Appeals will hear public comments on
a number of projects in or abutting residential neighborhoods that have generated community
concern. These include:
1) the potential legalization of the building expansion at 1-4 Hayden Terrace (visit:
http://users.rcn.com/gst12c41/1-4_hayden/);
2) the Superior Court's request for "clarification" in the matter of Emerald Development's
proposal to build a huge condominium complex at 343 Summer Street, the site of an MBTA
ventilation shaft (visit: http://www.braceus.com/sssc);
3) a proposal to put another large condominium complex on Willow Avenue, between Morrison
and the Bike Path. This project will require at least three variances, and have no setback from
the bike path.
4) The Somerville Corporation's proposal to re-develop the St. Polycarp's Men's Club site on
Temple Street. I know little about this proposal, except that it includes demolition of a lovely
and historic building.
Typically, developers put forward alternatives of development as they propose it, or no
development at all. The challenge, always, is defining and promoting APPROPRIATE
development, which is in balance and proportion to its location and neighbors.
This meeting should be interesting, whether you are inclined to advocate, or to listen and learn
about these projects and the zoning approval process. Who knows, the next development project
in Somerville may be on your block!
3) SOMERVILLE'S REAL ESTATE PLAN UNVEILED
A) Homans Project Jettisoned in favor of Powerhouse Location
Last year, the Board of Aldermen worked for months to ensure the fiscal viability of the Gay
Administration's proposal to renovate the Homans building in Gilman Square. The
administration's plan was to consolidate city and school central administration offices on the site.
One of the imperatives driving the plan was the desire to free the city of the escalating burden
of city payments for rented space in the TAB Building and the Boys and Girls Club.
In order to make the project work financially, however, it was essential for the work to start
immediately, and proceed on schedule. The project "slipped" substantially in the months after
the Board of Aldermen voted conditionally to approve the bond authorization for the project.
One of the Board's conditions was the creation of a Municipal Property Review Committee to
craft a long-term facilities plan for the city.
Ironically, that Committee on March 24, 2004, recommended that the Homans renovation
project be abandoned, and the municipal departments be instead re-located into the Powderhouse
School. The proposal to renovate the Powderhouse for this purpose is not just conceptual; the
project has been costed out, at $5.5 million, or $63 per square foot. A "space allocation
scenario" and a "renovation schedule" have been prepared, the latter calling for project approval
in April, and completion in July of 2006.
I would say, under these circumstances, that having been declassified as a school in need of
remediation under the No Child Left Behind Act will not be enough to keep the Powderhouse
in operation as a school.
B) Real Estate for Revenue - Sales Plans
In addition to the Conwell School, the report of the Property Review Committee has
recommended that the following municipal buildings be sold: the 13,464 sq. ft. Recreation
Building on Walnut Street, (valued at $595,562); the 9,729 sq.ft. Durrell School on Beacon
Street (valued at $1,014,039); the 91,920 Edgerly School on Bonair Street (valued at
$2,682,383); the 13,965 sq.ft. SCAT building in Union Square (valued at $902,759); and, once
the Powderhouse is renovated, the 18,216 sq. ft. City Hall Annex, (valued at $856,214).
Interestingly, the report says nothing about the fate of the Homans building. But with so many
buildings to sell off, the city may hardly notice for the next couple of years the lack of new
revenue at Assembly Square. Will all these assets ultimately be liquidated for operating
expenses?
C) No Families with Children Need Apply?
On March 24, 2004, John Hanna, the mayor's new Director of Youth Development outlined to
the Board of Aldermen his vision for Somerville's acquisition of Dilboy Park, to develop into
the city's premier recreational facility. Also on March 24, the mayor designated the Visiting
Nurses Association as the preferred developer of the Conwell School, across Alewife Brook
Parkway from Dilboy. While assisted living facilities serve a valuable function in any city, it
strikes me as very sad that all proposed developments of the site for family homes was ruled out
as a less desirable use of the property.
The Conwell School is not only adjacent to Dilboy, with its park land, pools, and playing fields,
but also to Alewife Brook, the Mystic River and the park lands on their banks, and to a lovely
playground just behind the site on Capen Street, owned and Maintained by the City of Medford.
There is probably no place in the city proximate to so many ideal recreational facilities for
young children. There is problem no population that will use those facilities less than those in
assisted living.
Plans for redevelopment of Assembly Square call for improving the park lands along the Mystic
River, and creating better access to them. Yet the current developers matter-of-factly state that
they will be building housing for adults. They refer to their residential development as a
"lifestyle community," that will discourage families with children by providing only one- and
two- bedroom units.
I see a lot of attrition already from Somerville of families with children for the usual reasons.
These include unaffordable rents and home prices, school closings, lack of yards to play in,
landlords who don't want to de-lead, and so won't rent to families with children. Is Somerville
developing unwritten, unspoken policies that will further discourage families with children from
settling here?
4) DECISION ON 2 A.M. CLOSINGS
This notice is just a reminder about the Somerville Licensing Commission will meet on Monday,
March 29, 2004, to vote on the proposal to extend closing hours for liquor licensees until 2:00
a.m. They will meet at 6:00 p.m. in the Academy Room of the Public Safety Building in Union
Square, 220 Washington Street, at 6:00 p.m. For questions, contact Joanne Burke at 617-625-6600, or
jburke@ci.somerville.ma.us
copyright 2004 Denise Provost
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