March 03, 2009

Telegram Story on Sale of ORH

Click here.

It really concern me that the price is determined after the sale is agreed upon? Shouldn't we get the offer up front and maybe there are better offers? Is there not a fiduciary responsibility to the citizens of Worcester to get the best price for this city owned asset?

Also what about the line "compensation price, meanwhile, would be reduced by the actual amount of any past state expenditures, subsidies and payments for operating costs". I read this to mean that any monies MassPort has paid the past ten years towards the operating deficit will be deducted from the purchase price.

In other words if it is determined that MassPort has contributed 15 million dollars the past ten years. This comes right off the purchase price. Now add "other past federal and state grant assistance for airfield improvements." What the hell is that number? It has to be large. Lets says that is another 15 million. We could theoretically agree on a sale price of 40 million, but in this example only get 10 million spread out annual installments.

Still not too late to invite AvPorts, National Express to ORH. If we sold the airport to one of these companies none of the monies being deducted from the purchase price above would be taken off the sale price.

I am all for the selling of ORH and I would be happy to have MassPort be the next owner, but lets make sure we get a fair price? Lastly there will be a local advisory committee. I truly would like to be on that.

12 comments:

Steve said...

I believe Worcester would be lucky to unload the burden of debt that ORH is sucking out of the city coffers. I suspect they are upside-down when all is said and done.

As far as a local advisory committee; check Hanscom. They are also owned by Massport, so they would probably use the same model.

Jahn said...

I just can not see the city selling to a private company. The local political establishment loses their 100% control over the airport if/when that ever happens. At least with Massport, the local pols still can exert political pressure if they are unhappy with Massport.

But on the other hand...given city finances..a sale to a 3rd party is looking better every day. esp if the city has to pay back all the money MP has advanced over the years.....pluis the private company pays real estate taxes,too.......unless they get The Hand It Over Theatre Treatment???..........which is no taxes for 10yrs which i suggest will ultimately be no taxes into perpetuity. GOD DAM JOKE !!!!

tHAT $750,00O IN LOST REAL ESTATE TAXES TEH hAND iT oVER tHEATERE does not PAY IS LOOKING MORE & MORE COSTLY TO TEH CITY EVERYDAY LATELY. Rushton and his municipal emmployee entourage s/b all over this no taxes issue for the Hand IT Over Theatre like a Gentlemans Warehouse $99.00 suit

Cultural enrichment....on a pig's necktie....!!!!!!!!............I call it Maddie and DeMoogie enrichment!!!! .......who's BS'ing who here??

Bill Randell said...

Steve:

You may be right, but how do you that?? Considering the fact we will be deducting all of these monies that MassPort has paid in, as well as any State and Federal Assistance--what is out net going to be??

Really thinking that we would be much better off long term leasing the airport to AvPort or someone like that.

Bill

Steve said...

Massport isn't willing to pay Worcester for the improvements that Worcester didn't pay for.

I'm making up numbers here, but they're not completely out of line.

Worcester claims the land is worth $13,000,000 ($10,000 per acre), plus $30,000,000 in improvements, the 'value' is $43,000,000.

The $30,000,000 is the terminal building, the new runways, the control tower, the instrument landing system, etc.

Worcester didn't pay for them, so Massport isn't willing to either.

Massport is merely subtracting the $30,000,000 in improvements that Worcester didn't pay for. The FAA paid for most of them.

Now, if they're planning to deduct EXPENSES from the value of the ASSETS, tell them to bugger off.

Bill Randell said...

Steve:

If MassPort is not willing to pay for them then maybe we should talk to someone else??

Maybe we should long-term lease the airport for say 50 years to someone, who agrees to pay the operating deficit and pays us an annual lease payment.

That way we would retain the asset. Selling an asset that a buyer when a buyer will not recognize the value of the asset makes no sense.

Bill

Anonymous said...

Dont forget, this isn't definate yet. The actual takeover is dependent on the approval of several variables. Lets not jump ahead just yet.

jahn said...

ANd I think I told you guys you were too premature with your kudos for thsi Massport takeover..........like everything deval does (or doesnt do) the devil is in the details

E.g. my property tax cut.....

Why should Massport pony up to buy Worc Airport in an economy like this..........well maybe b/c they plan on buying it with all teh money they have already given us ..........remember when you were a kid the term "Indian Giver"....now all of a sudden when it's time to buy ORH the 10 Subsidies are converted to advance/upfront money to buy the place.....we got Murray down there and this is all he can do for us..........i.e. essentially convert former subsidies to amts to be paid back

TOGETERH WE'RE SCREWED

Bill Randell said...

TOGETHER WE ARE SCREWED

I luv it

Anonymous said...

After reading about how we may lose valuable land by deducting MassPort's generosity? for the past ten years I've been trying to think of a win-win situation for the taxpayers of Worcester--here goes:

1.Downgrade to General Aviation only-from what I've read on this blog and heard at city council meetings grants do not have to be paid back if it remains an airport.

2. Get the solar company that wants to lease the land in hear ad the $ we get from them pay off the dremaing debt service.

3.The above would mean no access road, no noise for surrounding neighborhoods.

4. unfortunately it may cost a few jobs like the fireman and the new airport manager (sorry Mr Davis), but the firemen, with their training could be transferred to leicester or Worcester Fire Dept. and I'm sure Mr davis can get another position w/ MassPort.

5. Worcester keeps and controls a land asset, still remains an airport (albeit without commercial flights), Worcester pays off debt and the terminal converted into office space for the solar company and maybe even a diner/restaurant for the pilots.

Anyway there it is.

Jon

Jahn said...

Any chance that there's someth ing in the ORH operating agreement between Worc and Massport that says that if they ultimately buy or lease the place that all the grants/subsidies paid to date are applied to the purchse/lease price?

Terms that come to mind here:

"Subsidize w/an Option to Lease"

"Subsidize w/an Option to Buy"

with all subsidies applied to lease/buy price?... Sure hope city hasnt shot themselves in the foot with this Massport agreement

When I consider some of the faux paus the city has made like:

a. Summer St. chruch

b illegal strip club zoning

c. soon(?)to be illegal vendor cart law

d. Union Station Rest. rental

e. Med. City underpaid land takings.

f. others?


Well sometimes I have to wonder.

signman said...

Why would the city sell property at top dollar?. They had a bunch of property and they would sell to lowest bidder for LIH..... Why would they change with this asset...BE glad they are not trying to find a way for more LHI

Anonymous said...

Jon,

Your plan makes sense and is the most relevant plan for all involved.

Too bad the die is already cast.