The Springfield School Department's central office, at 195 State St., is a handsome old building, but hardly hospitable to modern working conditions. Built at the turn of the last century, the building is run down, with an old elevator that reportedly makes some workers so nervous that they always take the stairs. There's not enough parking for visitors or staff. There's also no air conditioning, meaning that on especially hot days, supervisors end up sending their employees home early.
The city has been looking for a new home for the roughly 150 employees who work at the building for years. Earlier this year, city officials settled on what some believe is a smart solution: moving the School Department into the former federal building at 1550 Main Street. Large portions of that building have been vacant since the federal court and other offices moved into a swank new $63 million federal building at State and Eliot streets.
Backers of the move say it's a winner all around. It would help keep the old building—a dated pile of glass and concrete that it's hard to imagine private developers fighting over—from "going dark." The infusion of all those School Department workers to Main Street would bring some much-needed foot traffic to the heart of downtown. Meanwhile, the city could sell 195 State St., ideally to a private owner, which would then put the property on the municipal tax rolls. (The challenge will be finding a buyer willing to sink in the money for the necessary improvements and deal with the lack of parking for its own employees or clients.)
But not everyone in City Hall is on board with the decision—or comfortable with the way that it was reached. Typically, when the city is looking to rent space, it sends out a Request for Proposals, or RFP, to would-be landlords, then evaluates the responses to identify the best deal. In this case, however, that never happened, despite the fact that both the City Council and the School Committee took non-binding votes asking for an RFP.
Because the rental agreement is between the city and a state agency (MassDevelopment, which is in the process of buying the old court building from the federal General Services Administration), City Hall is not bound by law to send out an RFP, as it would be were it dealing with a private landlord. Nonetheless, a number of elected officials say, the city should have sought competing bids for the project, to ensure that it's getting the best deal.
"I think it's important for the city to go out to a public bid for several reasons," said City Councilor Tim Rooke. "One is so we get the best possible price, and we're not paying taxpayers' money we don't have to spend. And secondly, after living through five years of the [Finance] Control Board and learning about best practices and transparency and open and public debate and review, this is certainly one of the items we should be going out to bid on."
Indeed, that's what Rooke, at least, intends to do. Last week, the councilor filed a request with the city's Purchasing Department asking that an RFP be sent out seeking a home for the School Department. That request seems unlikely to go anywhere; city attorneys say that Rooke does not have the legal authority to request an RFP, and that the city already has a signed (although not yet executed) lease agreement with MassDevelopment.
At the very least, Rooke's request draws attention to a politically charged question: Why City Hall, on the verge of spending millions in rent for an important city department, didn't do some comparison shopping before it signed on to the federal building deal.
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After years of talk about relocating the School Department, by last year, the old federal building had emerged as City Hall's favored spot. Efforts to move the deal forward intensified this spring, as city officials became anxious to get the department settled into its new home before the start of the 2009-10 school year (a goal that, in the end, won't be met).
That's not all local officials are anxious about, though. Behind the celebratory atmosphere surrounding the new federal building—a project that, it's hoped, will spark other development and investment along the State Street corridor—are fears about what the loss of tenants at the old federal building will mean for the already struggling Main Street.
City development officials have acknowledged the importance of finding new tenants for that spot. "It wouldn't serve us to put more empty office space downtown and further weaken that market," Brian M. Connors, deputy director of economic development, told the Springfield Republican last September. David Panagore, then Springfield's chief development officer, told the newspaper that the city would like to see a mix of private and public tenants in the building. "Bodies in the downtown are good. Private sector bodies are even better," Panagore said.
City officials had, in fact, gone so far as to draft an RFP for a new School Department headquarters. According to that document, dated August, 2008, the city was seeking at least 40,000 square feet of space, to accommodate up to 208 employees. The site must be in the "metro-center" neighborhood, no more than one-quarter of a mile from City Hall, the RFP said. Bidders would also need to identify at least 208 nearby parking spots.
"The City intends to secure the most cost effective solution through a competitive bidding process by seeking proposals for office space from the eligible proposers through this request for proposal," the document stated. In addition, it went on, the city planned to "seek, separate and apart from this process, a proposal for office space from MassDevelopment … in the proposed publicly owned and operated 1550 Main Street"—although, the RFP noted, any lease between the city and MassDevelopment would be exempt from state bidding laws, since MassDevelopment is a state agency.
The document makes clear that the city already saw potential benefits to moving the School Department to 1550 Main St. "While all proposals shall be required to meet the minimum criteria as outlined in this request for proposal, public ownership may provide unique opportunities for project financing and other cost savings and allocation," the RFP said. "All bidders, including MassDevelopment, are encouraged to identify unique opportunities or features which may assist in determining and or selecting a location for the School Administration Central Offices."
According to the draft RFP, bids for the project would be due by September of 2008. A couple of prominent downtown property owners indicated interest in the project: Paul C. Picknelly, owner of Monarch Place, and a representative from Samuel D. Plotkin & Associates, owner of the former Sovereign Bank building at 1350 Main St., attended a School Committee meeting about the plan, where both said they could accommodate the School Department's needs. (The Advocate was not able to reach Picknelly at deadline. Evan Plotkin, president of Plotkin and Associates, was out of the country and unavailable for comment. His office referred questions to Ronald Eckman, resident agent for the corporate owners of 1350 Main St., who did not return a call.)
In the end, those property owners never got the chance to bid on the project. That's because the RFP was never released. Instead, as became increasingly clear in the months that followed, the old federal building was the location of choice.
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This spring, the School Department's move to the federal building was announced as a done deal. In May, the Finance Control Board unanimously voted to authorize the city to enter into a 10-year lease with MassDevelopment. Under the deal, the city would pay $10.86 per square foot, or almost $600,000 a year; that rate would increase by three percent a year after the third year. In addition, the city would be responsible for $3.8 million in renovations to the building. (A $1 million state grant would cover part of that cost.) The lease includes two optional five-year extensions.
The day after the Control Board vote, a group of Springfield politicians—including Mayor Domenic Sarno, U.S. Rep. Richard Neal, state Reps. Ben Swan and Cheryl Coakley-Rivera and state Sen. Stephen Buoniconti—held a press conference at 1550 Main St. to talk up the plan. In addition, Baystate Health announced it would also rent space in the building—a point stressed by officials as an indication that the reuse was a "public-private partnership." That same day, Gov. Deval Patrick announced that the project would receive a $3 million state Growth Districts Initiative grant for renovations to the plaza area outside the building and to common spaces inside. In total, MassDevelopment will pay $11 million—including the state grant and the funds from the city—to buy and renovate that building.
Officials at the press conference lauded the plan as a vital boost to Springfield's downtown. "The redevelopment and reuse of the federal building represents the rebirth of a workplace that will now be a tremendous asset to the central business district," Neal said.
In a statement to the Advocate last week, Sarno outlined multiple benefits to the plan. "Moving the School Department to this location will prevent this building from having its lights go out and prevent it from becoming dark," the mayor said. "The combination of Baystate jobs and school department employees will stimulate the downtown economy and create additional economic development." Meanwhile, as improvements are made in the State Street area around the new federal building, the old school building at 195 State St. will become a "prime real estate property for redevelopment," Sarno said.
While Sarno is now a lead supporter of the MassDevelopment lease, back in March, the mayor—who is also chairman of the School Committee—voted with that body to request that the city release the RFP. By May, however, he'd changed his mind, voting, as a member of the Control Board, to authorize the city to enter into the MassDevelopment lease. Sarno's spokesman, Tom Walsh, said the mayor's position changed because of new developments—namely, the state grants to finance the MassDevelopment project.
In his statement to the Advocate, Sarno described the plans for 1550 Main St. as "a key piece to downtown redevelopment. … Failure to take this action would have had a negative domino effect along the Main Street corridor and this is something my administration has been working hard to change."
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While no one's arguing about the importance of injecting new life into Springfield's Main Street, some elected officials argue that the city should have undergone a more thorough, open process to find a new home for the School Department.
"People do not want that building [at 1550 Main], important as it is because of its centrality in downtown, to be vacant. We don't want to become a city with more vacant buildings than we already have, and that's such a big piece of real estate," City Councilor Pat Markey told the Advocate. "I understand the desire to fill it as soon as possible. I just think an RFP would be the way to do it….
"I think everything ought to be as public and transparent as possible," Markey continued. "There's an RFP process, in general, so we get the best deal, and the public trusts we're getting the best deal. And maybe this is the best deal. But since there wasn't an RFP there are questions, legitimate questions."
Chris Collins, chairman of the School Committee's Buildings and Maintenance Subcommittee, described the Control Board's decision to skip an RFP as an example of the Board ignoring the voice of elected officials. "The Control Board decided that it was going to do whatever it wanted to do," he said.
As a School Committee member, Collins said, he's charged by residents with spending their tax dollars as responsibly as possible—including not spending more money than necessary on rent. Without a public bidding process, "the problem is, you don't know if you've got a good deal," he said. "It's like buying a car: If you don't go to two or three dealers, you don't know if you're getting a good deal."
The downtown economy will benefit wherever the School Department moves, Collins said. But Springfield students won't benefit if the city overspends on a lease. "I want every dime we can possibly spend on the kids," he said.
Steve Lisauskas, formerly executive director of the control board and now the city's acting chief administrative and financial officer, has said the terms of the MassDevelopment lease are significantly cheaper than what the city would pay in the private rental market. Rooke, however, said that, based on conversations with downtown property managers and owners, he believes the city could have gotten a better deal, in a nicer space. He also questions why the city should be responsible for more than $3 million in improvements to the space. (While $1 million of that will come from a state grant, that's still taxpayer money, Rooke noted.) If the city rented space in a newer or better-maintained building, he said, those improvements wouldn't be necessary.
By not opening the project to bids, Rooke said, the city is shutting out local property owners who've already invested in the downtown. "And on top of it, we charge them the highest tax rates in Massachusetts," he added.
Rooke said he'd prefer to see the School Department relocate to one of the larger, privately owned buildings downtown, such as Monarch Place, the Sovereign building or the site of the former Johnson's bookstore on Main Street. "Quite honestly, the [old] federal building should be demolished. It's the ugliest building in the city," he said.
The owners of two of the three properties suggested by Rooke as better sites for the School Department have donated to the councilor's campaign war chest: Evan Plotkin, an owner of 1350 Main St., gave $100 to Rooke's campaign last month. So did Glenn Edwards, a New Yorker who owns several buildings downtown, including the old Johnson's bookstore. Rooke has also been working with Plotkin on a project to bring artists' work and living spaces to downtown.
Those contributions have nothing to do with his call to put the project out to bidding, Rooke said (in fact, the councilor's criticisms of the move to the old federal building predate the contributions by several months). Rooke said he thinks Plotkin and Edwards decided to support him politically because they appreciate that he's trying to create opportunities for businesses.
While the city isn't required by law to solicit bids for the new School Department site, common sense demands one, Rooke said. The city also isn't required to seek bids for certain other contracts—the police towing contract, special education bussing—but it does anyway, to ensure that it's getting the best deal, he noted.
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Why, then, didn't the city send out the RFP it took the time to prepare last summer? Rooke suggests there's been political pressure to fill the old federal building, pointing out that the Patrick administration expressed a keen interest in seeing MassDevelopment get the lease, including releasing a $3 million grant to move the project along.
Others point out that Neal has worked hard to get the new federal building, and the surrounding improvements on State Street, in place; that achievement would be less impressive if the site of the old federal building was left empty as a result.
Neal's office said the decision not to send out an RFP was made on the local and state level. The congressman has, however, been involved in efforts to move along the old federal building's sale to MassDevelopment, which is expected to be finalized this fall. A MassDevelopment press statement last month described Neal as working with the agency and the Sarno and Patrick administrations to "[make] downtown Springfield an attractive business destination for employers and employees alike."
In a statement to the Advocate, Neal spokesman William Tranghese said: "We are pleased that Mass Development negotiated an agreement with the GSA, Baystate Medical and the School Department for the re-use of the old Federal Building on Main Street. It represents an exciting rebirth of a public structure in the heart of downtown Springfield. Its renovation is also a critical component of preserving the commercial tax base of our central business district. In addition, the rehabilitation of 1550 Main Street will bring more people downtown which has always been a priority of Congressman Neal. We agree with the city and its major stakeholders that this was the best plan to successfully redevelop the site."
Not everyone, of course, agrees that it was the best plan—starting with the city councilors and School Committee members who voted to send out the RFP. Those votes carried no real weight; the Control Board, which at the time had authority over all financial decisions in the city, made the ultimate decision. That authority has since been returned to the city's elected officials, upon the dissolution of the Control Board at the end of June.
Rooke's request to the Purchasing Department to release the School Department RFP has been referred to the city Law Department. Deputy City Solicitor Kathy Breck told the Advocate that the city could put itself in a legally vulnerable position if it seeks public bids for the project after already signing a deal with MassDevelopment.
But because MassDevelopment has not yet taken ownership of the old federal building, Rooke believes the city still has an opportunity to step back and reconsider before it commits to the 10-year lease. "This gives us adequate time to go out and do our due diligence and find out if this is best price," he said.
