State getting some leases in order
Officials putting finishing touches on plan to raise rents and provide public access
IT HAS TAKEN THREE YEARS, but state officials are finally putting the finishing touches on a plan to start charging yacht and boat clubs fair rents for the public land they are leasing.
The plan, mandated by the Legislature three years ago and currently under review by the state Inspector General, would grant long-term leases to the 31 clubs while also requiring them to pay more in rent and provide greater access to the public.
Prominent educational institutions with boat houses along the Charles River, including Boston University, Northeastern, Harvard, MIT, Tufts, Belmont Hill, and Buckingham, Browne & Nichols, would see the biggest changes under the plan.
Harvard, for example, was paying only $1 a year in rent for its Harvard Sailing Pavilion along the Charles. State officials upped the rent to $5,000 last year, but that figure will jump to $18,000 under the draft plan and subsequently increase at a steady rate for the next 30 years. The rent could eventually reach as high as $100,000 a year under the more aggressive scenario outlined in the plan.
CommonWealth obtained a draft copy of the leasing plan that was labeled “for discussion purposes only,” suggesting revisions are possible. The responsibility for drafting the leasing plan falls to the Department of Capital Asset Management, the state’s real estate arm, working in conjunction with the Department of Conservation and Recreation, the state agency that actually owns the properties. Officials at both agencies declined comment without first seeing the document.
The state’s land deals have come under increasing scrutiny as questions have been raised about leases with terms well below market rates. CommonWealth reported last year that rent from some of the state’s leases, licenses, and permits was going uncollected, lease expiration dates were being ignored, and some leases were being renewed in perpetuity at bargain-basement rates. State officials subsequently brought in state Auditor Suzanne Bump to do a top-to-bottom review of the leasing process.
While Bump is wrapping up her work, the Department of Capital Asset Management is trying to complete work on a new system for handling yacht and boat club leases on public land. Under the existing system, clubs are grouped into four tiers. Small clubs and nearly all of the clubs affiliated with educational institutions are in the first tier and pay fixed rents of $5,000 a year. Medium, large, and very large clubs are in the second, third, and fourth tiers, paying $8,000, $10,000, and $15,000 a year, respectively.
Under the draft plan, the educational institutions would all move into the fourth tier with the very large clubs, paying $18,000 in rent the first year. The other three groups would remain in the same tiers, with rent starting out at $6,000, $9,600, and $12,000.The rents for all four tiers would then increase in equal installments up to the fifth year, when the rent would be double the annual payment under the current system.
Beginning in year six, the draft plan offers two options for increasing lease payments over the remaining 25-year life of the leases: annual increases of either 3 or 5 percent. Under the 3 percent option, rent for the top tier would max out at $63,000 in the 30th year. The peak would be $100,000 under the 5 percent option.
The draft plan requires the clubs to provide in-kind contributions of public access, stewardship, and outreach each year, plus hold an open house. Starting with the lease’s sixth year, the draft plan allows the clubs to reduce their rent payments to the state dollar-for-dollar for the value of the in-kind contributions, which could include such amenities as public restrooms and water fountains, parking access, boat rentals, trash cleanup, snow removal, youth sailing or boating instruction, and local scholarships.
No mention is made in the draft of how the in-kind contributions would be valued or monitored. Oversight of state leases by the short-staffed DCR and DCAM has been lax in the past. The Wollaston Yacht Club, for example, stopped paying its rent in 2006, and over time ran up a tab of $32,000.
DCR last year threatened to evict the club if it didn’t bring its rent payments up to date. The club has since made two $5,000 payments to cover 2012 and 2013, but it has only reduced its back rent by $1,000, $500 of which was paid only last week after CommonWealth began asking questions about the club’s back rent. The club’s commodore, Michael Pelosi, said the club is doing the best it can.
“In the span of little over a year, we have paid a total of $11,000 to keep current and make good-faith payments towards our debt,” he said. “While there is more work to be done, it is an incredible accomplishment for an organization that let itself fall into this situation in the first place.”
Another battle that may be looming on the horizon for DCR Commissioner Edward e Lambert involves the nonprofit Charles River Watershed Association, which has been told to vacate its leased DCR building located on the Leo J. Martin Golf Course in Weston by the end of the year. The association’s $100-a-month lease expired in December 2010 and hasn’t been renewed.
The association’s executive director, Robert Zimmerman, says the eviction is payback for his strong opposition to legislation that gave Simmons College guaranteed access to a DCR park in Brighton on the Charles River in exchange for more than $5 million to refurbish the facilities at the park.
“We may elect to play hardball over this,” Zimmerman said. “I’m in no hurry to move out of here and pay too much money for another place.”