Boston Globe on ORH

Click here

Greendale Mall

Drove by today. The parking lot, along side the highway, was hosting a huge carnival. Is there no surer sign that a mall is in trouble when they can rent out half their parking lot to a mall.

Still stand behind my Best Buy will close by the end of the year.

Governor Cristie

love this guy

Pharmasphere

March of 2008 was the planned ground breaking when the parcel was awarded for $1.   May, 2010 they have not taken title and not one penny of taxes has been paid.    I am sorry.  The more and more I see the results of our RFP Process (Mason Street being another), I say lets just auction the property to the highest bidder.

Downtown

Great news on UNUM signing a lease.   Lets see what happens next.

Another observation.  City View restaurant....   Looks very nice.  Is very nice.  Simply the wrong restaurant right now for this location.   Don't see it making it through the summer.

Airport Prediction

By the end of the year we will have two additional commercial airlines.

Public Hearing on Job Growth

The Mayor’s Work Group on Job Growth and Retention invites Worcester businesses and the community at large to attend a public hearing to share their input on how The City of Worcester Can support existing businesses and recruit new businesses to locate here.


Date: Wednesday, May 26th 6-8pm
Location: City Hall – Levi Lincoln Room
Contact: Isabel Gonzalez-Webster – 508-799-1153

Airport Sale

I did not notice any revenue sharing in the press releases; for example a percentage of parking fees or a per dollar amount for each passenger or freight?    Right now when parking, passenger and freight is low at ORH, it would be a good idea to ask for this.  As ORH takes off, literally, it would provide some annual income back to the City of Worcester.

How can 2.6 million for us keeping the industrial park land be counted towards $17 million package.  Assume you have a house worth an empty lot next to it that is.  If you sell the house for $200,000 and keep the empty lot that is worth $50,000, the total sale package is not $250,000.   The sale package is $200,000 and you kept the empty lot.

It appears to me that the true number is 14.4 million and we were able to keep the Industrial Park land.

Airport Details

Total Package valued at $17 million
Click here:


Mass Colege of Pharmacy bought Crowne Plaza total package valued at $16.8 million.
 click here

Despite the fact I think we would have received a better return, if we had done a 99 year lease.  This is great news for ORH and Worcester. 

49% of the Southgate Place has been given away

As much as I am against Southgate Place,we have no choice but to deal with it and make the most of it.   The silver lining is that although the project cost $7,000,000, there is only about $1,000,000 that has to be paid back so there should be a positive cash flow for the South Worcester Neighborhood Center to reinvest back into the neighborhood.

The thing is only 51% of the profit goes to them.  The the other 49% goes to their other partners.     What exactly did they put up to get 49% of the profit?  Nothing.   True they did alot of work up front, which they had to float until the grants came through.  Now they have been paid for their work and get 49% of the profits.  

You get 49% ownership in a 7 million dollar project and you don't have to put up one dime.   Puts new meaning into Robert Allen's Nothing Down Real Estate books.

Two great opinion letters this week

Dick Chernisky--capping affordable housing

Robert Z Nemeth--on the Arizona law

Great job by both

DHCD Subsidized Housing Chart

Click here for the latest numbers on the percentage of subsidized housing by municipality.   Worcester at 13.6% according to the latest numbers, meanwhile Newton is at 7.7%.

jeff has take the list and ranked them, click here. 

Dan Gaulin

There was a post the other day to one of my blogs from a Dan Gaulin.  I commented that I thought there was a Dan Gaulin involved in the project so I sent an e-mail to him to confirm that it was in fact him that added the comment.   He got back to me yesterday and confirmed that it was him, Dan Gaulin owner of Elmwood Homes LLC of Newton, an affordable housing consultants for the developer.   He did tell me in the e-mail that Patriots Environmental was another local contractor hired, but did not explain what was no true about my other statements.



Here is the blog again:


No-Lo Tour Stop 3


City Builders, now Southgate Place, is the stop today. Wonder if the Telegram story will note:

• all the abutters were against this project
• nobody from the neighborhood will be present since they are all against Little Plumley
• the cost of the project is 7,000,000 million dollars for 25 units or $270,000 per unit,
• 100% low-mod income apartments-no market rate housing!!!!!
• no worcester contractors have been hired, so much for Buy Worcester (stand corrected the plumber, Grassechi, Patriots are two local contractors)

Dan's Comment 


I was there.

Since point 3 (100% low-mod)is the only true statement from your post, it was the only one that was mentioned this morning.

Jahn Post

He sent me an e-mail question how a project that cost 16-17 million dollars, 9 May Street, can be assessed at 1.7 million?  Good question. 

Telegram story on Southgate Place

$6.3M housing project breaks ground


WORCESTER — The South Worcester Neighborhood Improvement Coalition broke ground yesterday on Southgate Place, a $6.3 million affordable housing project on the former City Builders property.

Located at 104 Armory St. across from the Canterbury Street School, the project will convert a contaminated industrial parcel into 25 units of affordable rental units. The project is a public-private partnership between SWNIC and Needham-based Home & Johnson StepONE Architects, an architectural and development firm. The two organizations are developing the project through the Mechanics Guild LLC, in which SWNIC holds the majority interest. The project will be funded by low income housing tax credits, a brownfields cleanup grant from the U.S. Environmental Protection Agency, several other public sources, and some private loans.

The first phase of the property will involve cleanup of the property and demolition of several abandoned buildings. The site will house a three-story residential building and an outdoor bocce court. Construction is expected to be complete in early 2011, and rental applications will be available in March of next year.

The use for the remainder of the parcel has not been determined, according to a press release from the South Worcester Neighborhood Coalition, but possible options include a daycare center or affordable elderly housing

Owner of Southgate Place--not SWNIC

Although the land for the proposed Southgate Place (Old City Builders) is in the name of the South Worcester Neighborhood Improvement Corporation, they will not be the owner of the final rented project.   These parcels are only in SWNIC's name so as to secure political backing and obtain the grants and not have to pay back any of the EPA grants-- non-profits like SWNIC do not have to pay back EPA brownfield monies.  (Truth be told there is one parcel in the name of Mechanics Guild).

Once the project is complete it will be transferred from SWNIC and Mechanics Guild to  City Builders LLC.    Here is a better description.   .   If it was, in fact, City Builders LLC, trying to develop this parcel from the beginning, they would have 1) had to pay back the EPA brownfield funds and 2) would have had a more difficult time getting all of the grant monies.

No-Lo Tour Stop 3

City Builders, now Southgate Place, is the stop today.   Wonder if the Telegram story will note:

• all the abutters were against this project
• nobody from the neighborhood will be present since theyare all against Little Plumley
• the cost of the project is 7,000,000 million dollars for 25 units or $270,000 per unit,
• 100% low-mod income apartments-no market rate housing!!!!! 
• no worcester contractors have been hired, so much for Buy Worcester (stand corrected the plumber is local)

No-Lo tour stop 2

Never made the newspaper or did I miss it?

Office Space

Guy stopped by my house selling magazines, bought three.  Reminded me of one of the greatest movies ever "Office Space".


one more

Phil Palmieri on Polito show

Phil was on WTAG talking about some of the good work the CDC's do.  In particular CDC (not sure which one) new construction housing that sold with to employees of UMass, who received down payment assistance from their employer.   I am 100% in agreement with Councilor Palmieri!!!   These are good projects, promote home ownership and help stabilize neighborhoods.  In fact I would even call this work force housing. 

Problem is many of the recent projects are not like this:

• May Street- 100% rental to low mod income
• Piedmont Street--100% rentals to low mod income
• City Builders-100% rental to low mod income
• Hadley:  90% rentals to low mod income
• 90 Grand Street-I believe this will be 100% low mod income

High density,  rental units that cost on average over 300,000 per unit with either 100% or close to it requirements for low mod income do nothing to improve our neighborhoods.

Jim Polito

Been listening to him lately on WTAG.   He is right on target.

Pharmasphere

Remember this parcel was awarded in the South Worcester Industrial park for $1 versus an abutting who offered $50,000.  The reason being it was a better project and that they would break ground immediately, that being March of 2008.     It is now May of 2010 and the winning bidder has yet to lay down their $1 and take title.

Business 101

Lets just take where the the market value of an owner occupied new construction duplex/townhouse is $140,000.  If you are a private developer you need to:

• find a cheap parcel of buildable land that you hopefully do not need any variances
• build it
• pay all the permitting and water/sewerage fees

Lets assume the expenses come in at $125,000 or less.  If you were to sell the property for $140,000 less broker fees, you may $10,000 to $20,000.   Bottom line alot of risk for not a hell of alot return.

Now add in the fact that you need to compete against a CDC, who spends $270,000 on their units, for the same buyer.  Here is the kicker, when they sell their $270,000 unit for $140,000, not only do they not lose 130,000---they make $37,000 ($370,000 development fee in the Sunday Telegram divided by 10).   

How does a private developer compete against a developer who should be losing $130,000 but makes almost $40,000?  Answer --they don't!!   They take their monies and invest in other areas.   Next time you see a private developer building anywhere else, but where the CDC's have control, you  now know why.

Worcester No-Lo Tour Stop 2

Let me set the record straight for the 10,000th time!  The CDC's have a vital role to play in the advancement of the City of Worcester and have done some very good work.   Right now, however, there is a complete over reliance on the CDC's, which has alienated much private investment as the RKG study warned 5 years ago.  

As the Worcester No-Lo tour continues, what I ask for is simple?:

1. Future projects by the CDC's need to emphasize home ownership in order to stabilize our neighborhoods! Building rental projects, because those are the only monies available cannot longer be accepted?
2. Rental projects, when built, need to be limited to no more then 15% low to mod income.  These latest projects that are either at, or close to 100%, low-mod only hurt our city never mind develop.
3. Any projects that receives, for example $100,000 or more from the City of Worcester, need to use the purchasing department of the City of Worcester to reign in their costs.   Costs from $250,000 to $300,000 per unit are a waste of the tax-payers money.
4. Put a cap on development fees to more then 5% of the project.
5. Opening the whole process to include private developers.
6. No longer should the CDC's be the "preferred" developers.  There is not one valid reason anyone can give me?

The CDC's success should be measured by their ability to attract private monies into an area, to the point where we do not need them anymore.    In other words a CDC closing down, because of private investment should be the goal of any CDC and  sign of their success.    Instead the goal of many CDC's is to accumulate as many properties as possible, land bank and treat the private developer as the enemy not their ally as evidenced by this Worcester No-Lo Tour.      

Fallon loses 8.5 Million in 1st qtr

Fallon is a great employer in the City, lets hope they turn it around.   Click here.  

Private developers part 2

Private developers who invest in real estate have typically four options:

1. Invest additional monies and then rent
2. Invest additional monies and then sell
3. Hold and pay the carrying costs
4. Sell right away

Sometimes you make money.  Sometimes you lose money. Sometimes you don't know if you made or lost money.   Another word for it is called "business".  

Private development tour???

People accuse me of being negative. If you don't know me and just read this blog, I can maybe understand that.   Let me be positive for a few minutes.  There is alot of private investment in District 4.   Look no further then fellow blogger Paul or myself (duplex I built on an empty lot on the corner of May/Bellevue that was sold to two first time home-buyers with jobs and without one penny of tax subsidies), but there are many many others.  Arthur Mooradian and Russell Haims to mention a very few on the residential side and Andy Serrato or Al Maykiel on the business side.  Trust me there are many many many more.   

We should be having a bus tour hi-lighting private developers, who are getting it done and listening to them as to how we may be able to help them do more?   Seriously if you had some money and wanted to invest into real estate and read either of these two stories:

1. Story about the City of Worcester having a bus tour hi-lighting private developers and how the City of Worcester is listeing and want to helps them do more.
2. Stoy about the City of Worcester having a bus tour hi-lighting CDC's and how they want to keep them as the "preferred" developer and not open up more to private developers

What story would make you want to come to Worcester?   Every two years we hear about making Worcester more business friendly.   When is the private development bus tour being scheduled?

Calling all bloggers

• Last week there was a bus trip to Beacon Oread to see all the affordable housing projects.
• Tomorrow there is a tour though Oak Hill.
• This week there is another ribbon cutting, 2nd maybe 3rd, for City Builders.

We need some name suggestions for this tour.   I came up with, instead of Paulie's NOLA Fest we could call it Worcester's NO-LO Fest.   We could even sell t-shirts, free to those are of no-lo income, listing the dates of the various stops on the bank with the picture of pajamas on the front.

Nemeth Story

I did miss this, click here.   Like Mr Nemeth I am also excited to see that the City of Worcester is out of the airport business.   Four years ago, or was it five, a group of us submitted a letter to the Airport Commission that he chaired expressing our opinion that we should privatize.   Basically we suggested that we put out a bid to lease the airport out long-term (99 years) like Newburgh, New York did when they leased Stewart out to National Express.   There was nothing about this idea that was "off-the-wall" from this silly blogger.  In fact our recommendation has become a reality, since the airport is being privatized through an outright sale to MassPort.  

Also, I never expected millions of dollars in a windfall profit, but as a tax-payer I did expect "fair market value".   Is Mr Nemeth suggesting that is a bad idea?  Since we never actually put the entire airport out in an RFP or even got a valuation, instead we just listened to studies from consultants?    My contention has been, is and always will be, are we getting "fair market value"?   Neither Bob Nemeth, myself nor any other silly blogger will know, since we never put ORH in its entirety out for sale sale of long term lease.

My gut tells me that five years from now when ORH is cranking, a good thing for Worcester and due to MassPort, we will look back on the sale of ORH like the Indians did after selling Manhattan.

Kudos to Sutner

Story in Telegram today titled "City's housing development at issue".  Will comment on these stories all week as the low income housing tour continues all week throughout the city of Worcester. 

For the first time I have read a story that at least starts to ask questions about this and not merely issue press releases. We need more trasparency as to how these monies are allocated especially considering the amounts of monies in question.  As I have maintained for years this has become District 4's biggest business and the people who are receiving the bulk of the HOME funds do not want to see any changes in the current policy.   Even to the point that a group, consisting of our Mayor and the District 4 Councilor, have been meeting since last winter "to map out a strategy to combat what they saw as an imminent assault of low-income housing in the poorest neighborhoods."

Here are some facts.
1)   The new housing policy will broaden the pool of developers, including private builders, with the goal of attracting more affluent residents and spur business growth and not merely give monies to the CDC's as the "preferred" developer.   A good thing, right?  Not for some of the CDC's and private developers, however, whose business model relies on these funds to continue.   A broadening of the pool, to even include private builders, is in fact an imminent threat, thus the meetings.

2)  The new housing policy will cap developer fees charged by non-profit and for-profit developers.  A good thing, right?  Not for some.  The article details  the third phase of the Gardner-Kilby-Hammond project consisting of 10 units with a total cost of $2,700,000 million dollars.     Where else can you build units in the this area that cost you $270,000 per unit, sell for half the cost and still make $370,500?

3)  The new housing policy will favor a combination of both low-income and market-rate housing.   A good thing, right?  Not for the current developers, whose recent projects (May Street, City Builders, Piedmont Street and the Hadley) are either 100% affordable or close to it.   They are at 100% affordable, since monies associated with the affordable units are typically given in the form of grants that you do not have to pay back.  Although a combination of low-income and market-rate housing is exactly what the city needs, a project that limits affordability to say 15% will force the developer to find conventional sources (private monies) for their financing needs and not rely solely on government grants (public monies).

4)  The new housing policy will merely create more competition and no longer give carte blanche to "preferred" developers.   A good thing right?      If you are the Executive Director of the Main South CDC making $104,000 per year with additional $14,000 in benefits, any move toward including the dreaded private sector is not a good thing.

In closing "CDC officials argue that most private developers avoid publicly-funded projects because they don't want the income and other deed restrictions that come along with public money."   If that is in fact the case, then what are they worried about?

Governor Christie

Wish we had a governor like this!!

Rumor Mill

Best Buy to close at Greendale Mall.  I was big on this when I heard that they were opening the Route 146 location then it kind of died down.   Now that the 146 Mall has opened and the numbers are falling into place.  I am hearing Best Buy at the Greendale Mall is done.

Also the new WalMart is doing big numbers but not the numbers that they projected.   The weird thing is that their numbers seem to be spread all over the place.  In other words not just one store is hurting, but alot of stores have felt a little hit.  At the same time a hit that they expected and planned.

Unlike the Market Basket in Oxford which was a complete home run and still is, the Walmart in Quinsigamond Village right now is only a single.

Southgate Place

Just heard there is another ceremony next week. althought they had one last fall??  This is the site of the former City Builders, lets hope they discuss some of these facts:

• 25 rental units-all low mod income against neighborhood opposition
• total cost 8,000,000 or 325,000 per unit
• 7,000,000 are in the form of grants that do not have to paid back as long as you rent to low mod income people during the affordability period
• general contractor and all subs to date are from out of town
• in the end the profits are split between the South Worcester Neighborhood and out of town owners
• EPA money is used that does not have to be paid back since the property was transferred to the non-profit-South Worcester
• believe they used the Mass General Law below to have taxes waived on one parcel that they bought

Piedmont Court

Update

MGL Chapter 58 Section 8

Another hidden cost.

This very interesting law.  It says if you are going to build affordable housing that 75% of any back taxes and 100% of the interest can be waived. 

You find a lot that $50,000 is owed and the City of Worcester has it in tax title, which they will eventually own and auction off.   A developer of low-mod income housing can approach this owner pay them short money, since they have already walked, and get most of the back taxes waived.   How much could the city have gotten if they did take title and auction.

Better yet, you let taxes accumulate on an empty building then you approach the City of Worcester and tell them that you want to develop affordable housing and invoke Chapter 58 Section 8 to get your taxes waived. 

I would like to see a listing of all of these requests granted the past 10 years and the amounts. 

Hidden Costs

Many times I have commented here on the cost of construction some of the CDC's.  It is not unusual to see costs in the 250-300K range per unit, but there are many hidden costs that I would like to remind you of:

1. Property that was sold for pennies on the dollar through the EONS via direct negotiations.
2. What costs will the most recent projects like 48 units on May Street, the 14 units on Piedmont and the 24 units on Southgate (City Builders) will have to our schools and other social services.
3. Infrastructure improvements like sidewalk repairs and road resurfacing that accompany many of these projects.

If you have not seen my map, check it out and tell me that we have not done enough for low mod housing.

Mayor Takes Group Walking

Title of Telegram story, click here for link.

Check out Paul's comments--dead on right Paul.

Let me say that this was a very fair story and I like the part where it is accurately pointed out that this "pointed out one side of the housing development picture."     There are many things that confuse me in this story

1. There are many properties that have been updated and repaired that have not been done by private investors without any assistance.  Maybe we should take a tour of these properties?
2. How can the Mayor say that the new proposed Housing  Policy may result in a diminished role for the CDC's without the new process even being implemented.
3. CDC's know community needs better then private developers?  Again there are many private projects that have met the needs of the community as well, if not better then the CDC's. 
4. 80% of the city's $12,000,000 in HOME  funds go to CDC's--that is $9,600,000 dollars!!  That is an incredible percentage/amount and maybe we should know who gets the other 20% or $2,400,000.
5. I agree the CDC's have set standards.  Incredible variances,, above ground sewer lines, very expensive construction, purchase of city owned land for pennies on the dollar and now the removal of streets from the City map to name a few.

Now I have a couple questions.  

Question--What message does this send to private developers?  
Question--What happened to making our city more business friendly? 
Question---How can anyone question "improving participation in ways that create an open and competitive process"?  

Answer--Those currently benefiting from a close uncompetitive process and do not want it changed.

1-9 Piedmont Street

This project consists of 12 one bedroom apartments low mod apartments with  4 commercial/studio/retail spaces on the street level.   By code it would have required 48 parking spots but a variance was applied for to waive all 48 spots in December of 2005.  In the application (Book 38111 page 259), it was stated (Section 13) that there was adequate off street parking available.  In other words, there was no need to provide all of these parking spots off street, on the property.

No private developer would have ever gotten a waiver of 48 parking spots and I need to ask, if you know this area, where will these people park??  There is limited off street parking in this area and it completely backs up each morning and day already from the nearby school traffic.   The variance, however, was granted. 

Now that the project is approaching completion,  without many (if any), local contractors (note picture above HVAC company not even from Massachusetts but Ct.), I have been told that there is a petition to remove Piedmont Ct, which abuts this project and extends between Piedmont Street and Castle Street.     My guess would be that the developer of this project will then ask for ownership of this road once removed from the official map.  Ironically they will say that they need this property for parking, since there is not enough off street parking for the project contradicting their own variance for 48 parking spots. 

Bidding

Many people are aware of how the City of Worcester can not just pick and choose the contractors that they want to use.   We have  Purchasing Department that puts out RFP's (Request for Proposals), solicits bids and picks the winning bid while following the state procurement laws.   Check out the site on-line.   This ensures fairness and that the City of Worcester tax dollars are spent wisely.

What alot of people do not know is that the CDC's are not subject to this.  Originally I got to believe that the thought was that their projects would be small in nature so why make it cumbersome for them, which makes sense.    I highly doubt that anyone would envision the big business these projects have become.  It is not atypical to see projects in the 5 to 20 million dollar range.

My point here is that the City of Worcester should look into how they could require anyone receiving HOME funds over a certain threshold for a project ($100,000) must utilize our Purchasing department to solicit bids to ensure that our HOME funds are spent efficiently.    And who knows amybe even a Worcester based contractor will be able to win a bid. 

City of Worcester Housing Policy

This issue is going to be discussed alot in the next couple of months and I want to take a minute to set the record straight on a couple things:

1. There has been and there is alot of good work done by the CDC's
2. I am not against affordable housing

There are however some things I would like to see change:

1. more emphasis on owner-occupancy to stabilize our neighborhoods. 
2. any rental projects should limit the low-mod income ratio to no more then 15% of the total units.  Current projects (City Builders, May Street, Hadley and Piedmont Street) are near or at 100%
3. utilize the procurement capabilities of our the City of Worcester Purchasing department to drive down the costs
4. encourage private developers to get involved.   Why do the CDC's have to be the "preferred" developers?

I keep going back to the RKG summary and they could not have been any more right, click here.   if you have not read these two pages, take a minute and please do. 

Thanks,

Bill

Players Championship

Great live coverage on
http://www.pgatour.com/

JetBlue

Interview with CEO Barger of JetBlue.

Downtown Restaurants

Random thoughts:

• Off the top of my head 86 Winter and Castelano's are for sale
• 55 Pearl Street is most definately closed as well as the Jewel Box
• there is no construction going on next to the Hanover.
• El Forno has closed
• Crown Plaza has closed

Now the City of Worcester has decided to go into the restaurant business and float a couple hundred thousand to install the infrastructure for a restaurant in the parking garage on MLK.   As much as we should not be in the airline business, not sure we should be in the restaurant business either.

JetBlue Starting Summer Expansion

JetBlue said Tuesday it is starting a rapid summer expansion of flights from Boston's Logan Airport, part of its plan to bump up its departures there by 30 percent.

Link here

Used Office Furnture

Anyone have any good places for used office furniture? 

Jewel Box

Rumor is this is closing and to be rented out as sports bar, heard that from a fellow blogger.


Stand corrected, it has already been closed for a couple months.  How long ws it open then as the Jewel Box?

Niche Hospitality wins bid

click here

Restaurant Storefront on MLK

Remember the RFP where the city was going to take out a loan to get it ready for a restaurant.    Has the bid been awarded?

Remember Paulie's rumor.  Click here in case you forgot

More Direct Air Press

Click here

Jahn Bet

Jahn I bet you straight up that the Crown Plaza will sell more then ORH.   If you win, I buy breakfast.  If I win, you have to attend NOLA fest.

ORH Sale

Nick K has some details today in the Telegram, click here.  

As I have been saying for months, or is it years now, I believe MassPort will completely turn ORH around.  At the same time, I have been saying that we are leaving monies on the table.   I fear alot more monies that I actually thought.   Never heard of an asset being sold for based on your costs to carry the asset the past 6 years.     In the end my gut tells me the City of Worcester is going to end up getting alot less for ORH then the Mass School of Pharmacy just paid the Crown Plaza (16.8 million).

I can understand the part about the "the airport could not be structured as a traditional real estate asset deal", then maybe we should have looked into a 99 year lease like Stewart International did when they lease their airport for 99 years to National Express in 1998 for 35 million.   It all goes back to when a group of us submitted a letter to the Airport Commission 4 or 5 years ago telling them to privatize the airport.   Translation--put out an RFP to lease out the airport.   This was dismissed.

Again Massport will be great for the future of ORH, but we are going to be dumping this asset way below what we should have.   Jahn, I bet the Crown Plaza will end being sold for more then ORH.

Illegal Immigration vote at State House

Kudos to Binienda and Fresolo for voting that taxpayer funded benefits go only to those who are eligible to receive them.  Click here to see how you rep voted.  

A "no" vote meant you required that anyone attempting to receive a public benefit must first be verified by the Federal Systematic Alien Verification for Entitlement program "SAVE." This system is already in existence and is both inexpensive and produces prompt results. The amendment also includes exemptions for those under the age of 18 and in disaster situations where state benefits must be accessed in an expeditious manner.


The "no's" lost so theis amendment did not pass. 

Mass School of Pharmacy to buy hotel

Telegram

Direct Air

Can they ever get good press?  Click here

Last week a Direct Air flight from Plattsburg, New York to Myrtle Beach, South Carolina left fourty bags behind after the airline prioritized getting golf bags onto the plane. “The golf bags went on first so we could make sure, because people are coming down to golf and they want to have their clubs on the course,” Direct Air Managing Partner Judy Tull told WPTZ-TV. Direct Air said they overnighted the luggage left behind, but passengers who had to wait an extra day on their bags were understandably upset

Mayo Group

Story in today's paper by Clive, click here.   Read it.  Not sticking up for the Mayo Group and their asbestos problems, but I do not see how we can question who a private owner hires.

On the other hand, I think we have a right to ask why some of our community builders do not hire more Worcester based contractors, since the City of Worcester supports many of these projects financially..   Matter of fact one is hard pressed to ever see anyone Worcester based contractors ever working at any of their job sites.     Look no further then the work being done at the former City Builders site or on Piedmont Street.  Not only is the GC from out of town but I have yet to see a local sub.

Crowne Plaza

Closes.  Click here.

I say lets move the homeless in. 

City Council Live Blog Coverage

Click here
moderated by Jeremy at WoMag

Weden Lane

Officially closed today at 238,500.  Thought I would have gotten more fot it, but we had fun.  Next real estate project that I will update here on the blog will be a three decker we purchased on Cambridge Street (297-299).  

Creperie

Just opened a block away from my office.  What is a crepe? 

Tax-Payer

Not a good week to be a tax-payer in the City of Worcester, residential or commercial.   Water and sewer rates going up 10-15% and there is a push to tax to the max (12 million).   At a time when we want to attract residents and businesses to come to Worcester, not sure if this is the message that we want out there.

Many times I have read Jahn mentioned that Worcester is heading towards receivorship.  Never real gave it much credence but in the last few months:

• two failing schools
• use of one time monies to meet budget
• taxing at the max levy
• increasing water and sewer rates

The sky is not falling, but all of these things bolster Jahn's prediction.

Rumor Mill

Pearl Street restaurant closing.  The mgmt of the place across street from the courthouse and the deli in the Med City taking over?

Unconfirmed

Beacon Street demo halted

There was an article in the Telegram this week how the owner of a building on Beacon Street was denied a demolition order inder the premises it is a historic building.  I can not help but think how the Citizens for Business Philadelphia Plan would be perfect to help this building get developed:

• waiving of all permit fees
• waiving all water and sewerage connection fees
• lock in of assessed value for ten years

Keep a close eye on this.  Would not be surprised to see this building being sold to a developer of low income housing over the next month. 

Tax Levy

Nick wrote about it today, click here.   It is official now. 

Over the past two weeks, the Councilor Gemain and Mayor O'Brien have floated up the idea of increasing the tax to the max or $12 million increase in taxes to all tax-payers. Currently the City of Worcester is not limited to 2 1/2 percent, since they are 12 million below the max tax levy.  In other words, the City Council can vote to increase the taxes without a 2 1/2 percent over-ride vote by 12 million 

You can vote lowest residential all you want, but a $12 million dollar tax increase is going to cost residents.  As Nick accurately points out "hold your wallets".   If nothing else maybe commercial and residential tax-payers will realize that we are all in the same boat with this push that will surely heat up now that it is in the open.

My guess is that, in the end, the Council will only go up $6 million and say they saved the tax-payers $6 million by not taxing to the max. 

Health Insurance update

Yesterday Blue Cross issued a directive that effective May 1st , 2010. All new business must include all items required to enroll a group must be submitted to the carrier 30 days in advance of the effective date.


If a group in the 1-50 markets wants to enroll with Blue Cross June 1st, for example, all information must be submitted by May 1st. Why would an insurance company institute such a requirement, when the current requirement is on average 5 days in advance?

Look no further then the article in the Boston Globe earlier in the month entitled, “Short-term customers boosting health costs.” The never-ending guarantee open enrollment that enables subscribers to obtain health insurance on demand, have pre-existing conditions in full without question and then allows them to cancel without penalty is costing the insurance companies a bundle. This in turn drives up the premiums for everyone in the 50 and under market.

Imagine if employers allowed their employees to enroll anytime that they wanted for their group sponsored health insurance plan and have pre-existing conditions covered in full, instead of the annual monthly open enrollment? Participation would drop dramatically, while the loss ratios would explode since employees would be obtain health insurance only when they needed it.

Blue Cross has decided to at least put a 30 day wait on the current insurance to curtail this abuse. Will it help? Sure will!! The uninsured, however, who need immediate coverage will merely go to other carriers, who have yet to adopt the 30 day wait. What next? All the other carriers will follow the Blue Cross lead and adopt a 30 day wait.

I can understand why Blue Cross has made this change, but let’s address the problem and go with a one month open enrollment, because the next step will be for a carrier to go to 45 day wait and the rest will follow. Then after that 60 days and then where will it stop?

Best Buy

Opens this Friday in Blackstone.   Greendale Best Buy in Worcester will not make it to the end of the year.  My humble prediction.

JetBlue to Hartford

Thanks Dave Z and Harry T

click here

Kane knocks out Cooke

Direct Air on Facebook

Maybe not a good idea?
Click here

Even more bad press

Housing Policy

One of the bigger issues we will see over the next few months will be the Housing Policy in the City of Worcester.  This is extremely important.   Admittedly I know nothing about the public school system in the City of Worcester.  I feel the failure of the two schools recently in the City of Worcester resulting in the firing of both principals, however, may be a direct result of our Housing policy as much as anything else.   The surrounding housing and the residents it attracts, who then send their children to the local public school, has as much to do with the success of that school.  Maybe instead of firing the principals, who I don't think deserve all the blame, we need to fire out housing policy.

Same for downtown.

Same for the businesses that are attracted to the City of Worcester.  Are you listening Chamber of Commerce?   The Chamber did a great job on the sign ordinance, lets hope they get as involved with this issue as well.    The type of housing that we build has a direct link to the types of business that will want to or should I say now not want to come to Worcester.   The Chamber needs to be involved.

Over the next few months some people will be portray anything other then the status quo as being against lo-no housing.   Nothing could be further from the truth.   Low income or affordable housing has a vital role to play, but the City of Worcester has put an over reliance on this housing.  Simply put enough already.   Just because you say, we have enough and are way beyond what the Commonwealth of Massachusetts mandates does not mean one is against it.

We need a balance in the City of Worcester.   A balanced housing policy will have a direct effect on our public schools and the commercial base.  It is simply that important.

April-Adopt a greyhound month

Mason Street & Butler Bank

We have talked many times about the lots on Mason Street that were sold via an RFP to the Mason-Winfield partnership.  The biggest lot, the former Royal Linen property, remains desolate over 4 years later, although the deed called for development within 2 years.

There was a smaller lot across the street, where duplex was built for home ownership.  Nobody has bought it, although it does appear that it is being rented?   The reason I bring this up today was that when the duplex was being built there was a sign "Financed by Butler Bank".   I never heard of Butler Bank before but I did yesterday.

They were the seized yesterday, story in the Boston Globe, by the Massachusetts Division of Banks.  

Rosen Reaction

New piece in Womag, thought it was good

City Kills Billboard Moratorium

Read the headliine yesterday above a story written by blog fav Nick K.   Ironically I was at the initial meeting, when a member of the ZBA suggested a board moratorium.   To me that mad sense to me also and I can understand why the City Council in turn asked for the moratorium.

As time went on, however, I learned more about this issue as I think other members of the City Council did with the help of the people who own the sign businesses and the Chamber of Commerce.   In the end I agree with Coucilor Smith's assertion that "the moratorium was no longer needed because the city administration will be submitting to the council in two weeks new zoning rules and regulations governing signs."
Bottom line although this was "messy", as Councilor Petty explained, I feel the Council respected the suggestion of the ZBA but did the right thing by not adopting it.   Think this is actually a good example of how government should work. 

Kudos to the people who own sign companies for getting involved and especially to the Chamber of Commerce.  Lets hope they get involved in issues like this that come up all the time and represent the business interests of the community like they did here. 

Chandler Business Social

Tomorrow     
Wednesday
April 14th
5:30 PM to 7:00PM
EVO
All invited.


Hope to see some bloggers there. 

Allegiant Air 1st qtr results

Allegiant Air, which is expanding its schedule of flights from secondary airports to vacation destinations, said Monday that traffic soared 16.4 percent in March.

The airline said paying passengers flew 545.6 million miles last month, up from 468.6 million miles in March 2009.

The rapid gain in traffic barely outstripped an increase in capacity, which rose 15.7 percent, to 587.4 million available seat miles, a measure of one seat flying one mile. Airlines boost capacity by adding flights or using larger planes.

Average occupancy, or load factor, rose to 92.9 percent from 92.3 percent a year ago.

Allegiant joined discount carrier AirTran and traditional carrier Continental in reporting strong gains in March traffic, adding to evidence that travel demand is recovering after the recession.

For the first quarter, Allegiant said traffic rose 18.6 percent, capacity increased 17.4 percent, and occupancy rose to 91.7 percent from 90.8 percent.

Shares of parent Allegiant Travel Co., which sells hotel rooms and rental cars along with air service, fell 61 cents to $55.79 in morning trading.

What a play

Masters

The live coverage on-line is awesome

go to

http://www.masters.com/

then click

on live link

Task Force

Many times I have mentioned here that the task force Mayor Murray put together on the PILOT issue was great.   Jim Leary ran it perfectly and the kids from the local colleges were unreal, as well as the people from CEO for Citites.  In the end we put together a great report with great recommendations that resulting in the formation of the Univercity Partneship, which was a complete failure.

The biggest mistake we made, which we addressed during our meetings, was that we would have follow-up meetings 6 months, 12 months etc later to review our recommendations and to see how they are being implemented.  We never had a meeting.

I am confident the current task force will do a good job, I only ask them to schedule a meeting now to review their recommendations in 6 months after their report is released.

Worcester Tea Party

April 15th--hope to see some silly bloggers there

Sign Question

Signman:

 

I got a question..  Today I was driving through Kelly Square and I noticed a portable digital sign in front of the Auto Glass place.    Where do I start?

1. Is this legal under the current ordinance?
2. Is this considered a temporary sign?
3. Does a permit need to be pulled for this sign?

Thanks

Buddy The Beagle

Rest In Peace  
1997-2010


picture tribute

Worcesteria today

TECHNICALLY, IT IS TAX SEASON: It’s April, which means it’s time for city councilors to start hinting at what side of the dual tax rate line they’re on. Last December, when the tax levies for 2010 were set, many councilors criticized the political body for making springtime promises regarding how they would vote the following winter. But history seems to be repeating itself, as a couple of councilors have now hinted which way they’ll vote next time. While discussing using money from the sale of the airport in conjunction with street, sidewalk and school repair, Councilor At-Large Mike Germain bluntly said “It may be time to have the honest, straight-forward discussion about whether or not we’re going to hit the tax levy or not. I think it’s time that we have the courage to stand up and say let’s do it.” Germain went on to say that if there’s a way to demonstrate to tax payers that there will be an “ROI” (Return on Investment) then some will agree that the money would be well spent on streets and sidewalks or more police officers. After his speech, Mayor Joe O’Brien added a quick “Well said, Councilor Germain,” before deferring the floor to district 3 Councilor Paul Clancy, who started his speech by distancing himself from the idea with a “Yeah, says you, Mr. Mayor. Not me.”

City Council Meeting

Last night I watched the City Council meeting and followed it on-line through Jeremy Shulkin, WoMag reporter, site.

It is kind of neat.  Click here

Next week you should check it out.    

New Nike Tiger Commercial?

Earl and Tiger @ Yahoo! Video

Airport Sale

Said this 100 times but here goes again:

1. Very glad we are out of the airport business
2. Once MassPort takes owenership, ORH is going to (excuse the pun) take off
3. Think we made a mistake not putting the entire airport out to RFP the past 10 years, I think we left some money on the table
4. Based on the information that I am reading maybe we would have been better off with a 99 year lease type deal versus an outright sale?

Lets just be happy ORH will become an asset to the tax-payers.

Affordable Housing by town

click here

Thanks Dave Z

Massport loans?

One of the things that has bothered me most with the sale to MassPort , that I have mentioned many times, is that all monies that MassPort has contributed the past 10 years+ will be credited to the sale; for example, if the agreed upon price was $20 million and MassPort has paid $13 millions to close our budget gap---we net out 7 million.

Today I heard the Mayor on the Peter Blute show explain this and he referred to the monies MassPort paid as loans?   Never knew that these were loans?   In fact I vividly remember Robert Z Nemeth saying numerous times in articles how grateful we should be to MassPort for helping us pay for the airport.  All the time they were loans?

Shooting

Shooting by Crystal Park tonight around 9:00PM on Gates near Hollis.    Did not look good.

New sign at 146 Mall

This sign put up today. 
Do you still think Best Buy will stay in the Greendale Mall?

Nick K

Another good story by Nick K.   Still amazes me how little we know about the sale of an asset like ORH when we are so close to the actual transfer date.

New housing policy

I know said the other day, I would come up with more details today but don't have any?   It is just real common sense what is being said.   Lets hold the low-moderate income housing levels at the current level (14%), which is already way about the 10% threshold as required by the state.   Lets support more market rate housing projects in the City of Worcester.

Who can seriously argue against this???   Think we all know who will--the developers of these low-moderate income housing projects.  There was one very interesting thing.  The new Housing report calls for a 7-9 member Neighborhood Area Revitalization Council.    I qualify to be a member and will be putting my name in.

The key to remember here is that some people may try to portray this as an attack on low-mod income housing.  It is not!!  Merely it is just a recommendation to keep the levels where they are at now. 

Never-ending open enrollment

One of the major problems with Massachusetts healthcare reform is the insurance companies need to accept people with pre-existing conditions 365 days per year.  People merely sign up for coverage, get all their pre-existing conditions and then drop the coverage--only to do it again.   The insurance companies are getting killed by these people so what does the insurance companies do?  Raise the rates on everyone else. 

People will call these rate increase as being the "big mean insurance" companies lining their pockets, but what do you think would happen to your home-owners or car insurance companies if insurance companies were forced to cover houses that were already on fire or cars after they were in an accident.   I have talked about this many times, including in the Telegram with my "As I See It" piece.

Today the Boston Globe has front page story on it. 

Sleepy Chamber

In the past I have often criticized the Chamber for being a one trick pony.  Once per year at tax time they write the same editorial and get on all the radio shows then make a cameo at a City Council meeting.  I have to give credit, where credit is due.  They got involved in the discussions on the sign ordinance and did a very good job representing the interests of the business community.

Lets hope this is the beginning of a new Chamber.    Here we have a new housing policy that will be good for our Commercial tax base.  The Chamber of "Commerce" should be all over this.

New Housing Policy

I just read through it quick...    Will follow up in more detail tomorrow..   Again click here.     The two major points are:

1. Worcester will maintain its housing that is affordable to low and moderate income households, currently estimated at 14%--far above the 10% required by the Commonwealth of Massachusetts
2. Worcester will promote housing development that supports a variety of housing types at desginated target areas throughout the the City.

Translation.  In the past we have done a great job creating housing for low to moderate income households.  In fact such a good job that we are way beyond what the Commonwealth requires, lets slow down and maintain at the current level.   On the other hand, we need to promote market, or dare I say housing, promote housing that attract people who make money.

Question:    Who can possibly disagree with these two points?

Answer:    The people who have made alot of money building these low to moderate income units.  To them, holding steady at 14% is not good for their bottom line. 


Stay tuned, we are sure to hear the people who stand to lose argue that 14% is not enough that the City of Worcester needs more no low housing.  What do you think?

Signs in St Louis

ST. LOUIS (KMOX) -- When it comes to putting up signs, the City of St. Louis wins, at least for now. The federal court in Eastern Missouri sided with the city over Jim Roos who put up the mural in south st. louis near Soulard.   The mural reads: "End Eminent Domain Abuse."  Roos had challenged the city's denial of a permit for the sign. The federal court upheld the city's position.  Jim Roos told KMOX's Mark Reardon there will be an appeal. "Thats the understanding between the city and us, if we eventually loose and there are no more appeals we'll remove the sign. Until that time however I think the sign is going to remain" Said Roos.

Roos called the ruling a blow to free speech.  He claims his mural would be legal if it featured a flag, a crest, civic symbol or if the city deemed it a work of art.  Roos had the mural painted on the side of a building in March 2007 to protest the city's use of eminient domain to take properties owned by Sanctuary , a low income housing organization.   The city has maintained it violated the sign code.

Paulie's blog

Puts things in perspective

Worcester New Housing Policy

Let me get my priorities straight.  Happy Easter and enjoy your family this week-end, whihc looks to be beautiful, and watch the Red Sox-Yankees Opening Day game Sunday.  This past Wednesday the City of Worcester presented their new Housing policy to the City Council.  Click here. 

It is kind of long so my homework assignment is to read through it today and tomorrow and give my review for Easter Sunday. Before I do that, lets review the 2002 RKG Housing report to the City of Worcester, click here.    Here are some of the hi-lights:

• The City of Worcester should find a balance in its affordabe housing needs that benefits all of its residents.   
• More emphasis should be placed on attracting a bigher class of people, who in turn would improve the commercial vitality of the City, and allow the City to leverage more private investment to increase the amount of upper-end products.
• While renovation work has helped stabilize some of the neighborhoods, especially at a time when the redevelopment was needed, their subsidized development has alientated some local builders/developers.
• The CDC's in the future should be considered more of a developer of last choice, and the focus of the CDC's should shift to creating necessary amentities that are lacking in some of the densely developed areas of the submarkets. 

In 2002 none of these recommendations were adopted.   Are you happy with the results in the City of Worcester since then??     I am not.  

As I heard Kate Toomey say once during the last campaign, the definition of insanity is to do the same thing over and over again, but expect different results.    Lets hope this new Housing policy reflects the recommendations outlined in the RKG Study 8 years ago and this time we listen.

Division of insurance rejects small group health rates increase

The thing I find the most amazing about this is that the rejected rates today for April, May and June is that---employers started working on their April renewals in Februar and have already made their decisions for April. Should not the Division of Insurance be approving or rejecting these rates at least two months before the effective date? This is only going to causeeven more confusion for strained groups and what will this really do. Answer--nothing. In fact the caps on what insurance companies may in the long run cause more damage then good.




Here (again) are some steps the Commonwealth of Massachusetts can take to provide real relief to small businesses:



1.Stop the never-ending open enrollment! People are able to sign up one date, have all their medical conditions covered the next and then cancel their insurance when all the medical conditions are treated. Only to do it again six months later, then we wonder why insurance premiums are out of control for everyone else? Just like any private/public carriers, or even Medicare, we need to limit open enrollment to one month per year

2.Allow employers to buy coverage without prescription coverage and while still meet MCC (minimum credible coverage) standards to avoid the penalty. The prices of the major pharmacies to buy prescriptions out of pocket without health insurance are incredible. Walmart, last time I checked, sold over 400 drugs for $4 for a 30 day supply or $10 through the mail for a 90 supply. Conservatively this alone would be a 10% reduction in premiums.

3.Allow employers to opt out of all the state mandates, like many self insured groups do. This also would conservatively take another 10% off premiums.

4.CommonwealthCare bases their acceptance solely on income. An asset test, like we do for Medicaid, needs to be added. It makes no sense for a person of substantial assets or the owner of a "cash" business, but who may have actual declared income under 300% of the Federal poverty level have his, or her, insurance premium subsidized by the rest of us. Also their are many people participating in this program that are eligible for an employer sponsored health plan, which make them ineligible for Commonwealthcare. An audit needs to be done.

5.We need to increase the penalties on individuals that do not have health insurance, although I question in the end how this can be enforced. Currently a person can claim that his medical beliefs do not allow for the purchase of health insurance. How is the Commonwealth of Massachusetts going to prove, or disprove, someone religious ideology.

6.Tort reform. I am not a lawyer, so I will let someone else get into more detail on this.

Lets focus on real ways, as outlined above, to control costs not political maneuvering which actually causes more harm then good.

Stewart Airport Newburgh, New York

Don't get me wrong I think MassPort taking over ORH will be great for Worcester, but let me tell you a little story about the airport above:

1)   In April, 1998, New York State selected the U.K. firm National Express to lease Stewart Airport for 99 years. Stewart thus became the first U.S. airport to be fully privatized and the first participant in the FAA’s airport privatization pilot program to complete the process.


National Express Group PLC offered $35 million in cash up-front, plus a percentage of airport revenues. Its bid was judged superior to those of the other four finalist teams: American Port Services (Baltimore), D.M. Airport Developers (Morristown, N.J.), Airport Group International (Glendale, Calif.), and LCOR / Schiphol Airport (New York City).

2)  In 2007, Port Authority of New York and New Jersey  purchased the lease of Stewart International Airport in Newburgh, N.Y., about 70 miles north of Manhattan from National Express for  $78.5 million lease. The agency could take over operations at the airport by this fall. . The law allows the Port Authority to expand outside of its current jurisdiction area, a 25-mile radius from the Statue of Liberty


As the details of the sale to MassPort evolve keep these numbers in mind.   Not saying Worcester is Stewart but 78.5 million for the remaining terms of the lease, not even ownership/  

Topeka

Did Google pick them??

Go to the google website