BOSTON—While the poor brand of baseball the Boston Red Sox played this past year drew the ire of many die-hard fans at Fenway, real estate deals on property outside the storied ballpark between the ball club and the Boston Redevelopment Agency were the subject of a highly critical report by the Commonwealth's Inspector General.
Massachusetts Inspector General Glenn A. Cunha in a 19-page report ripped the Red Sox and the BRA for transactions in 2013 involving the closing of Yawkey Way adjacent to Fenway Park for concession sales during events and the transfer of air and subterranean rights on Lansdowne Street. The Inspector General found that the BRA did not due diligence in the deals. He also was critical of the process BRA followed that included the taking of a city easement from the City of Boston over Yawkey Way and the transfer of air rights in that easement to the Red Sox.
The Inspector General states in his report that the BRA “followed inadequate rules and procedures for the taking of rights pursuant to demonstration project plans in Yawkey Way and the parking lot on Van Ness Street."
He also stated that the BRA's findings in 2012 and 2013 of urban blight that facilitated the takings, “were not supported by the evidence.”
Cunha also found that the BRA failed to secure a revenue-based sale price for Yawkey Way and Lansdowne Street and employed “illogical and questionable valuation methodologies.” He later stated, “As a result of the BRA's flawed process, the sale price of the 2013 transactions was seemingly insufficient.”
The report noted that the final sale price for the Yawkey Way and Lansdowne Street rights was $7,340,377. The deal was originally for 10- ears, but later amended as permanent.
In his report, the Inspector General called for the BRA to adopt a number of new policies, including procedures for reviewing and approving projects, as well as policies regarding employing eminent domain. The IG did not recommend restructuring or striking new deals in connection with the 2013 transactions.
The IG report follows a scathing rebuke of the BRA's policies issued in July by McKinsey & Co. in July.
Laura Oggeri, chief communications officer for Mayor Martin Walsh, in a prepared statement, said the IG's findings are indicative of why the mayor is looking to restructure and reform the BRA. “The city will closely review the Inspector General's report, however it is clear that the BRA acted inappropriately and ignored their responsibility to the taxpayers,” she stated.
BRA Director Brian Golden says that the agency cooperated fully with the Office of the Inspector General and is reviewing the report and its findings. “As the current administration and BRA leadership team have stated all along, we believe the process that led to the agreement with the Red Sox was deeply flawed. Since January 2014, we have worked diligently to enact reforms so that this situation can never be repeated,” he noted in a statement. Golden added that the BRA has instituted a policy to bring greater transparency, including a public comment period, to future proposed land transactions.
He later added, “There are always lessons to be learned from past mistakes, and we are committed to adopting a policy and procedures that better govern the BRA's use of demonstration project plans going forward. We value the Inspector General's thoughtful recommendations on this issue and look forward to enhancing our protocols.”
The Boston Red Sox released a statement, noting that most of the IG report involved internal recommendations and process reforms for the BRA. However, the Red Sox did make clear that “the transactions were for fair value, and the product of complex and tough negotiations over a protracted period between the club and the leadership of the BRA in 2013, concluding a process that began a decade earlier.”
The ball club added that the lawful transactions were based on full market analysis and were performed by outside appraisers. “If anything, the price the Red Sox were asked to pay for air rights and for the limited use of a street is much higher than what other private parties had previously paid for air rights or for street use, the Red Sox stated. “The Red Sox ultimately agreed to the final terms very reluctantly.”
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