WINCHESTER - The group known as Citizens for a Better Waterfield (CBW), who encourage residents to vote against the special election question next week, released more information where they outline “four better paths still open to the Select Board.” Members believe a better deal for the Waterfield lot still exists.
Paul Manganaro and John Miller, of CBW, claim the Select Board and town manager’s team declined to consider shortening or adjusting the 99-year lease. They argue “a shorter or a renewable lease is just common sense.”
(Miller was also the Finance Committee’s liaison to the Select Board and town manager’s team,)
In a release they write, “the deal is ‘lopsided’ in favor of the developer in large part because of the 99-year term.” They said the length of the lease was discussed “in multiple calls” with the town manager’s team and Select Board members.
Manganaro and Miller blame the town’s Request for Proposals, submitted by the Select Board, and point the finger at “outsiders” giving some bad advice. They point to a “fundamental” mismatch between the length of the lease - 99 years- and the useful life of the systems inside the building - 30-35 years.
The two CBW members suggest the goal should have been a “manageable 35-year effort to design, building and operate a building.” After that, the town would “then get it back to decide what to do next.”
Instead, they argue, the RFP “was converted into a 99-year speculation by the developer” due to the property’s prime downtown real estate in Winchester adjacent to public transportation.
Manganaro and Miller say two different ways to shorten the lease were brought to the town manager’s team and Select Board: shorten it to 35 years with an option to extend upon agreed terms or for the town to recompete the lease in the market; or keep the 99-year lease with two renewal options in years 35 and 70.
They say the town manager’s team had no interest in either scenario.
Better Path 2
Manganaro and Miller outline a second issue: the Select Board and town manager’s team declined to employ the protections other government’s use in similar long-term leases. In pointing out the Waterfield lot project isn’t the first Public Private Partnership in North America, CBW suggests the town had other examples to look at.
They say, to get a “good deal” over a long-term lease, the town “must obtain specific, detailed, contract commitments from the developer as to what ‘proper’ operation, maintenance, repair, and replacement of key building systems, in each case, means.
They note how other jurisdictions have done this and protected themselves, in advance, to avoid future conflict while buildings go and remain in disrepair. They suggest the contracts can operate smoothly if properly written. If requirements aren’t met, it gives the town options such as terminating the lease and replacing the developer.
Miller said he delivered sample language from school projects in Alberta, Canada that he believes address these issues and would protect the town. He said while the Select Board and town manager’s team made “modest” changes, they failed to present the “substance” of the Alberta protections to the developer.
“The agreement can and should be improved,” he argued.
Better Path 3
Both Manganaro and Miller outline a third fix to the Waterfield lot situation: a competitive sale of the land to a purchaser. They call the Waterfield lot a “valuable piece of property in downtown Winchester that is better used to increase the commercial tax base” and suggest an RFP could include a commitment by the town to permit similar development to what’s proposed here (multi-story and mixed-use) for use as the purchaser decides (housing, commercial or office).
If the same 60-unit residential building is constructed with all units at market rate, they say FinCom estimated an NPV of $10M to the town from the sale (or the equivalent of the 2019 override). They also say that FinCom estimated the property tax receipts over the next 99 years would be $161.6M or four times the amount projected from the developer using their own numbers.
Better Path 4
Finally, both Manganaro and Miller point blank say doing nothing would actually result in a better deal for the town. They argue that parking revenue collected from the site over 99 years would help the town’s bottom line more than the Land Development Agreement.
Under the “do nothing alternative,” FinCom shows a net present value of cash flow to the town in the low range of $209,240 and a high range of $514,020 over the next 99 years. The developer, meanwhile, would rake in, according to FinCom’s calculations, a top amount close to $65M (the low range shows the project failing).
CBW also argues the talk concerning the project’s effect on 40B is “over stated.” They claim “in exchange for ineffective, temporary protection from Ch. 40B, the Select Board should not agree to a ‘lopsided’ deal that ties up a valuable piece of property, costs the town many millions of dollars, and misses a prime opportunity to improve the town’s commercial tax base.”
Currently, the town resides in safe harbor meaning its protected from unwanted 40B developments (such as the one on Cambridge Street). If the Waterfield project goes forward, it would extend the town’s safe harbor status, set to expire next March, another year (and 20 more on top of the 60 Civico units would extend it another two years).
However, Manganaro and Miller state the project is “not a panacea.” They say the 40B problem will continue because, according to the inventory issued by the Planning Department as of May 26, 2020, there are a total of 296 Ch. 40B subsidized housing units in town and a total of 7,920 housing units in town. This leaves the town 496 short of the 10 percent needed to stop a 40B project.
It should be noted no one on either side of the discussion suggested this one project would get the town to the magic 10 percent number, only that it would extend the town’s safe harbor status another year. This way the town can continue to develop more affordable units.