Arguments Against an RFP

Over four hundred people attended the Public Hearing on the Milton Centre project at Pierce Middle School. A large number of residents voiced their thoughts on the project generally, and the wisdom of issuing an RFP specifically. I estimate that 55% spoke against issuing an RFP, while 45% spoke in support of doing so. Many of the arguments offered by opponents were arguments against the Milton Centre concept per se, opposition to which seemed to form the basis of their stand on an RFP for the DPW yard. Their arguments against an RFP continue to proliferate, creating the impression for those who don’t examine their claims that a significant number of legitimate concerns exist which support the notion of doing something, anything, other than issuing an RFP. I’m going to discuss some of these arguments which have been made at the Public Hearing, on their website, and in their mailings.


An RFP Is a Contract

This argument holds that an RFP creates a legal obligation on the part of the Town to proceed with one of the respondents to the RFP, and that not doing so creates a legal liability for the Town. This claim was made by one of the opponents fairly late into the public hearing, despite the fact that our consultant, Jon Witten, stated unequivocally at the beginning of the hearing that this was not the case.

Here are the pertinent facts on this topic. The Massachusetts Office of Inspector General is responsible for oversight of Chapter 30B, the Massachusetts law governing the disposal of government owned property. It’s September 2001 Bulletin reports on the controlling case on this very issue. The case, Mangano v. Town of Wilmington, 51 Mass. App. Ct. 857 (2001), found that municipalities may cancel plans to sell or dispose of property it owns. According to the IG, “The Appeals Court held that the omission of specific language in M.G.L. c. 30B authorizing the cancellation of an RFP did not prohibit the town from withdrawing the property from bid. Municipalities have broad powers to control and dispose of real property on terms they deem appropriate.” The Inspector General’s office wrote supporting the Town of Wilmington in this case.

A couple of facts of this case are interesting. The Town Meeting had already approved the transfer of the land in question to the Selectmen for disposal. And the formal RFP document issued by the Town neglected to mention that the Town reserved a right to reject all proposals. Despite this, the court upheld a community’s right to reject the bids and cancel plans to dispose of the property. Anyone interested in the Findlaw report on the case will find it here:

http://caselaw.lp.findlaw.com/scripts/getcase.pl?court=ma&vol=appslip/98p1928&invol=2

So no fears of a legal obligation should stand in the way of the issuance of an RFP.



Milton Centre Will Produce a Net Loss in Revenue

This claim was advanced at the public hearing and is contained in a letter, with “analysis”, to the Board of Selectmen from resident Doug Anderson. This letter was on the opponents website but has been removed. It represents a refinement of original assertions that the Milton Centre proposal was a “Big Box” retail development. No knowledgeable person would claim that “Big Box” retail is the proper way to characterize some shops, a bank, office space and a supermarket. The contention here is that the development will generate more costs to the town than it will cover in revenue.

The basis for this claim is a study done for the Town of Barnstable by the nationally known firm, Tischler and Associates in 2002. One of Tischler’s specialties is assessing the fiscal impact of various types of development. Their study for Barnstable can be found here.

http://amiba.net/pdf/barnstable_fiscal_impact_report.pdf

If you search for this study on the internet you will find it referenced on a number of single issue websites whose sole purpose is to oppose some type of development. Even some media have picked it up and offered it as an analysis which is descriptive and definitive for the various types of development it analyzes, anywhere in the United States. Now, when I read the study it became clear that there were a number of elements in the analysis which could vary, not only from one part of the country to another, but even from one community to another in Massachusetts. In other words, the Tischler study for the Town of Barnstable is a custom analysis reflecting the specific circumstances of that community. Its conclusions regarding any type of development cannot be extrapolated to other communities as if it were a formula.

To confirm my thinking I called Paul Tischler, President of what is now TischlerBise in Bethesda Maryland. Since I’m in the service business myself, I knew he wouldn’t want to spend too much non-billable time talking to me. I was brief. Was he aware of the widespread retailing of his Barnstable study on the internet? He was. Was it the case that the Barnstable study could not be taken as having established norms for the various types of development examined in that study? Yes it was. And didn’t that mean that one couldn’t simply take the resulting data on positive or negative revenue for a given category of development and apply it to another community? Yes, that is what it meant. We discussed just two variables with effects on the outcome of any analysis – assessing methodology and tax rate philosophy. The second of these proves most instructive. The Tischler analysis of fiscal impact takes a comprehensive approach to estimating revenue and service costs to arrive at a net impact. For all development types, property taxes represent the most significant contributor to the revenue side. Barnstable is like most communities in Massachusetts in that it taxes residential and commercial properties at the same rate, so all the revenue projections in the Barnstable study reflect that. Milton, like about 105 other Massachusetts communities, has a split tax rate. We tax commercial property at twice the rate of residential property. So all other factors being equal, the commercial developments assessed in Barnstable would produce twice the property tax revenue in Milton that they produce in Barnstable. The substantial change in outcome from this one variable would also affect the claims made by opponents that residential development, even tailored to empty nesters, produces more net revenue than the commercial development envisioned in the Milton Centre Project.

So the claim that the Shops at Milton Centre will produce negative revenue, based on the Tischler study for Barnstable, is not the case and does not present a rational reason for not issuing an RFP.

Milton Centre Will Not Produce $500,000 in Tax Revenue

Over and over again opponents have questioned the gross tax revenue scenario offered by Milton Centre LLC. The only strong argument made in support of this was made by John Connery of Connery Associates in a letter to the Selectmen. His analysis predicted tax revenue of $360,000.

Of course the town of Milton could make its own estimate, along with any other proposals which came out of an RFP process.

In any event, at the Public Hearing the attorney for the developer stated his client would be willing to guarantee the $500,000 tax payment to the town, making this argument moot.

So the claim that we won’t see $500,000 in tax revenue is not a reason to refrain from issuing an RFP.


Decide What We Want First

There are many variations on this theme. There’s the “we’re letting the developer drive the process” theme. There’s the “residential would be better” theme. There’s the “let’s go through a process of deciding what we think is best” theme.

The developer is not driving this process. We are. Yes, his response to our Community Development Plan started the ball in motion. Thank God somebody started something. And yes, he has made a proposal that many consider attractive. But if we issue an RFP it will be based on our “terms” as we lay them out in the document. We will decide how broad we want the exploration to be. If we don’t like anything we see, we can walk away. And if we decide to advance the consideration of Milton Centre’s proposal, or anyone else’s, we still have an extended process of review and discussion, culminating in the Town Meeting.

The opponents of Milton Centre have proposed a residential alternative to the mixed use commercial plan of Milton Centre, in whole or in part. Their claims about more tax revenue have been discussed above. This approach ignores the consensus view that Milton cannot continue to rely on the taxes paid by residential homeowners, but must seek, in keeping with proper community planning, to increase alternatives such as commercial development. While a well thought out residential development will indeed produce revenue, it will also increase the Town’s dependence on the home owner to fund necessary increases to our revenue stream in future years.

The Community Development Plan finished just a year ago recognized the need to expand our commercial tax base. The public forum echoed this obvious need. The report states:

http://www.townofmilton.org/Public_Documents/MiltonMA_BComm/PB/Milton%20Final%20Plan2.pdf

“Based on the input received at the Economic Development forum, there is a strong interest in redevelopment of Milton’s commercial areas, re-zoning existing but nonconforming business uses to commercial, and potentially rezoning additional areas for limited commercial development.”

Town Administrator David Colton echoed the plan’s findings on economic development in his letter to the Milton Times.

“The future remains bleak. Since 2001, our reliance on the property tax levy has increased by approximately 5% of total revenues. The Property Taxpayer’s share has increased over that period by over $9M. Nonetheless, the direct and essential public services provided to the residents of the Town of Milton are in extreme peril. The Town needs to consider its options for dealing with the cost of services, including commercial development, and it is not enough to just say, “Build it somewhere else.” The amount of income garnered from commercial, industrial and personal property taxes has been falling since FY 2000 and now stands at the lowest level in at least 19 years! . With the exception of the 2 Granite Avenue office building, the community has not added to its commercially zoned districts since they were carved out in the 1930’s. Since that time the population of the town has gone from approximately 16,000 to over 26,000.”

Some semblance of balance between residential and commercial development must be found if we are going to fund our services at a reasonable level without raising our residential property taxes to a point which creates great hardship for many Milton residents. With virtually no undeveloped land for development, the CDP recognized the need to get more from what we have, including re-zoning certain sections of the town for commercial development. The DPW yard was one of the major recommendations in this area.

The suggestion of building a residential development at the DPW yard quickly compounds the problem. Where will the DPW yard be moved? Who will foot the bill for a new facility? One of the areas suggested for relocating the DPW yard is the State DPW yard on Granite Ave. We would then not only be exacerbating our reliance on residential property taxes, but we would be allocating one of the few commercially developable pieces of land in town for a municipal use. The result of this double folly would be to remove two promising developable sites from our almost non-existent stock.

The most frustrating part of this argument against issuing an RFP is the last one, which says we need to undertake a process to decide what we want. We’ve already done that. It’s called the Community Development Plan. It involved citizens, town employees and state assistance. It is responsive to what everybody involved in town affairs – our elected and appointed officials, the Warrant Committee, and Town Meeting Members – know is a crying need for our town. And it is now being ignored by those who wish to defeat commercial development and want to pretend we haven’t already assessed our needs and decided on a wise direction.

Whether the Shops at Milton Centre is the best response to those needs is yet to be determined. But that the response should be commercial development is directly responsive, and we should not be dissuaded from that.

Since we already have a development plan which outlines what we want, suggesting we need to do it again because some people don’t want it is not a reason for not issuing an RFP.

Milton Centre LLP Has an Unfair Advantage

I’m told that this argument is now being embraced by Selectman Mullen as a reason not to issue an RFP, even though he left the clear impression at the Public Hearing that we should proceed with “terms” and with other locations included.

Does Milton Centre LLP have an advantage? Of course they do. They have purchased land to enhance their development proposal, provide more buffer for abutters, and to relocate and build a new DPW yard for the town- one of the roadblocks noted in our Community Development Plan. But how is this advantage unfair? To whom is it unfair? Other developers? Should we be worried about other developers, or should we be worried about the very best result for the town of Milton? Should we ask Milton Centre not to offer additional buffer zones made possible by land acquisition? Should we ask them not to offer us land to relocate our DPW yard so we can develop the current one as our Community Development Plan recommends? Should we decline their offer to build a new DPW facility? All in the interests of being fair to other developers, with the result that none of the proposals will offer Milton as much value as we otherwise could have had. We’ve seen the proposed developer vilified as a profit motivated company who does not place Milton’s needs first. Well, I’ve got news for you, that’s true of all developers. It’s up to us to put Milton’s needs first, and we do not do that when we look a gift horse in the mouth because of some misguided notion of fairness. A notion that seems to have as its true motivation the desire to kill a proposal that will likely provide more overall value to the town than others.

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I'm heading off to my childhood home in Maine on Saturday to enjoy a 1950's style 4th of July celebration.

Happy 4th of July!

Milton Centre Public Hearing

My comments delivered at the Public Hearing


I’m here tonight to urge the Selectmen to develop and issue an RFP for the commercial development of the DPW yard.

Since the proposal for the Shops at Milton Centre was announced, there has been a barrage of accusations leveled against it. A development that includes a supermarket and a few small buildings with 2nd floor office space and ground floor retail shops has been described as a massive mall. It is said that this development would be so large that it would ruin the town but,oddly, not produce any substantial revenue. We’re told we wouldn’t have power to prevent a fast food restaurant or a Best Buy locating there. That is not the case. The Selectmen and the Town Meeting can place restrictions on the development and can even consider a reverter clause that would provide for the land to revert back to the town if certain restrictions were violated.

All of these issues, and more, can be discussed during the lengthy process that lies ahead. This includes consideration by the Planning Board and Town Meeting, where a 2/3 vote would be necessary for anything to happen.

None of these issues, whatever their merit, should stand in the way of proceeding with an RFP. The purpose of the RFP is to see what others might propose for the DPW site. Then we can look at what’s possible.

A year ago this very month the town finished a Community Development Plan that recognized the need for commercial tax revenue. One of three recommendations made for fostering economic development was to “establish new commercial zoning districts to expand non-residential tax base”. One of the specific areas recommended was the area around the Randolph Ave/Reedsdale Road intersection. The plan said: “Rezone this intersection, including the Tedeschi store and adjoining lots, the Rectory and the Town DPW yard for commercial uses.”

A year later, one of our own, a Milton resident, has approached the town with a development proposal specifically addressing a recommendation we created in our plan. We now face a choice of rejecting this offer, or giving it its due consideration by issuing an RFP. Issuing an RFP does not obligate us in any way to accept any proposal, including the proposal for the Shops at Milton Centre. Not issuing an RFP is a direct repudiation of our own plan. How could we justify not issuing it? What would we say to the citizens of this town who know only too well that we need more revenue from commercial development? What would we say to those residents who want to preserve or improve services, but just can’t dig any deeper into their own pockets? And what would we say to the Town employees and citizens who participated in creating the community development plan? Perhaps most important of all, what message would we be sending to other potential developers, including those who might be interested in helping us do something with our growing list of vacant businesses? If we fail to take a no-obligation next step on a proposal that responds to our own plan, who will take us seriously? We might as well place signs on all the roadways entering the town which say: Milton. Commercial Developers Need Not Apply.

I urge the Board of Selectmen to take the only reasonable course of action for the benefit of all the residents of Milton and issue an RFP for the development of the DPW Yard.

Mr. Lantigua Writes Again

See Mr. Lantigua's comments in the post below.


Frankly, Mr. Lantigua I don’t understand your claim that the square footage, the commercial tax rate and the estimated tax revenue somehow reveal that this development cannot be just for Milton. Just how do those numbers do that?

No one has claimed that people from outside Milton won’t use these shops. The developer certainly hasn’t. What is disputed is that these shops are intended to be a “destination mall” in the way that real malls are.

As for litter, Mr. Lantigua, I live on Reedsdale Rd. I pick up litter from my property all the time. I don’t have any particular aversion to BJ’s or Wendy’s litter versus, say, Tedeschi’s litter. Litter, after all, is litter. But since you seem particularly offended by refuse from those two companies, you’ll be happy to know that our town is not likely to allow them into the shops. That will not, of course, eliminate the current litter problem from “those people”, including Milton residents, who like to shop at BJs and eat Wendy’s fries.

Yes I have walked around the shopping areas of Randolph. I’ve also walked around the shopping areas of Concord, where two of my closest friends live. I don’t really think that you are going to be very successful convincing people that litter is a problem we can’t handle, or that is going to seriously erode the annual revenue from this project.

Now as for home values, I’m not a genius either, so we start out even in evaluating this factor. I simply don’t think it’s as simple as you suggest. The same claim, by the way, was made about the Fruit Center 25 years ago. It was wrong then, and I think it is wrong today. The developer has proposed a substantial buffer around the project. Part of the process going forward is to permit further, extensive discussion of issues like this.

Your car analogy is not apt. No one is talking about accepting any offer. We’re talking about proceeding with an orderly process. As we do that, we'll be discussing the issue with all Milton residents in mind.

As for the golf course, we got a great deal! Maybe you’re not familiar with the history. Try reading my post “Quarry Hills and the Moderator’s Race”.

Response to Mr. Lantigua

This is a reply to a comment posted to the previous article. The comment can be read by clicking on the word comment at the bottom of that article.

Mr. Lantigua,

Thank you for your kind comments about my efforts. It’s important to be diligent and thorough, don’t you think?

You ask, “what’s in it for the developer?” Well, I hope profits are in it for them. After all, isn’t that why developers develop? Isn’t that how they have the money to pay taxes to the communities in which they do business? But perhaps your question was rhetorical.

Our neighbors have every right to oppose the Shops at Milton Centre. I can understand how they might be fearful of their home values being impacted. I can understand it, but I don’t think that will be the case. At the same time, we must consider this proposal from the perspective of what will benefit the town as a whole –the 26,000 residents and approximately 7,500 home owners who are struggling to finance the town services we demand.

I happen to think the Shops at Milton Centre is a very attractive proposition for Milton. But I have not made up my mind because we’re at the very beginning of the process of evaluation. We need to look carefully at the traffic issue, and other concerns may arise.

That doesn’t make me a shill for the developers, Mr. Lantigua. My concern is not for them, but for what our town needs. If I have a bias, that’s it.

At some point I hope it is going to occur to opponents that their cause is not well served by mischaracterizations of the motives of people who disagree with them. My motives, Mr. Lantigua, are just as honorable as yours.

The Shops at Milton Centre and Milton’s Community Development Plan

Opponents of the Milton Centre development claim the proposal “violates”, or somehow is a departure from the Community Development Plan completed just about 1 year ago.

Here’s what they say on their website about the Community Development Plan:
http://www.savemilton.org/facts.php

“The three town priorites are:

1. Redevelopment of "under utilized" sites (i.e., sites already commercially zoned)

2. Re-zone existing non-conforming uses to enable expansion (i.e., increase already zoned commercial land)

3. Establish new zoning districts.

The RFP is working backward. It proposes the rezoning of the DPW from residential to commercial. Quincy and Co. has purchased, or is attempting to purchase land around the DPW and on the East side of Route 28. They would then be in a position to use the second town priority to grow their enterprise well beyond the DPW yard.”

Does the development plan frown on re-zoning?

Let’s look at the plan and see. Each of the priorities listed above (which are described in the Plan as recommendations) is accompanied by bullet points which provide specific recommendations. Here’s recommendation 3, in its full form, with the accompanying bullet points. Added emphasis is mine.

“Establish new commercial zoning districts to expand non-residential tax base

•Granite Avenue Corridor – Re-zone for office/hotel/retail. The area to be rezoned should include existing state DPW yard and the VFW property.

•Reedsdale/Randolph Ave area – Rezone this intersection, including the Tedeschi store and adjoining lots, the Rectory and the Town DPW yard for commercial uses.

•Pepsi Plant area –Re-zoned from residential to a new limited industrial district. This district should allow, by right, for low- intensity uses such as wholesale business, warehousing, etc. By Special Permit, this area could be approved by the Planning Board for retail or for mixed use retail/residential development.”

So we see that recommendation 3 dealt with establishing new “commercial” zoning and in every case the method involved a re-zoning of the locations involved. And the second bullet specifically recommends the re-zoning of the DPW yard for commercial development. So it is simply untrue that an RFP would be “working backward.”

At a Selectmen’s meeting it was suggested that the DPW area did not receive priority support at a public workshop. Of course the public workshops were one source of input for the plan, a plan which specifically recommends what the Milton Centre Development is requesting. The forum referred to occurred on March 18, 2004. In an exercise which involved attendees voting on potential locations for development, about 40 residents participated. The final list of 20 locations puts the DPW yard just about at the bottom of the list. But the list also contains this notation next to the DPW yard: “concern expressed about where the DPW would relocate”.

Now as you might expect, such a large concern would affect the priority one might assign to this location. Where would you relocate it, and how would you pay for constructing it? What do you think the response would have been if the participants had been told that land in a more appropriate location would be provided to the town? And how much more support would have been garnered if the participants had been told that someone was willing to build a new DPW facility on that property? I really don’t think the outcome of this workshop exercise withstands scrutiny as an example of “departing” from the community development plan.

The final argument used by opponents focuses on the size of the project, which they say violates the plan. They’ve taken to calling it a “Mall” and describe it as a monstrosity that is out of scale and which is specifically designed to be a “destination” center.

The anchor of the shops is a grocery store. Now while for Milton residents' grocery shopping may indeed be a destination trip to another community, that is not the case for most communities. Add in a bank and a few small scale, mixed use office/retail buildings and I don’t think you have anything like the descriptions offered to describe it.

But of course of all this can continue to be discussed as we prepare and issue an RFP to explore the possibilities for the DPW yard. The next step in this process is the public hearing on Thursday evening June 23 at 7:00 at the Pierce Middle School Auditorium on Brook Rd. We’ve been hearing a lot from the opponents. Will others step up?

A closing comment on another claim made on the opponent’s website. It concerns Jonathan Witten, a consultant the Selectmen brought in to assist in the process, and someone whose services they may retain. Here’s the claim:

http://www.savemilton.org/facts.php

“Here's the town's lawyer point regarding the RFP: Click to view the outline of his comments
He isn't in favor of the proposal.”

Now when I read that, I was virtually positive that it was not true. I had carefully listened to his comments at the Selectmen’s meeting and he said nothing of the sort. But perhaps he said it at some other time. I contacted Mr. Witten last Thursday and read to him the words which I have quoted above. He was dumbstruck. He was quite clear that not only is he not opposed to the proposal, it would be a violation of his role to have any position on the issue.

I hope whoever is responsible for the savemilton.org website will remove this comment. I’m sure they do not want to mislead the people of Milton by listing under their “facts” section something which is not.