Could this mess happen here in Boston?
Before addressing this question, let's look at who are the winners and losers in the Plymouth Rock Studios collapse.
Winners. Governor Deval Patrick's administration is a big winner in this mess, having turned down a request for $50 million in infrastructure improvements related to the project because the developers had been unable to come up with private financing to back the project:
The state’s decision in June not to grant the studio $50 million for roads and other infrastructure was a particular blow... Patrick administration officials said last week that the state still wants to aid Plymouth Rock - if the studio comes up with long-term funding first.The state appears to have learned its lesson after the Columbus Place hole-in-the-ground disaster.
And don't forget the other big winner: the Globe's Spotlight Team for hard-hitting reporting that may well get nominated for an award in the next year.
Losers. The big loser appears to be starry-eyed city officials and town meeting in Plymouth, who have green-lighted the project without doing much due diligence into the developers:
When Plymouth’s Town Meeting convened in October 2008 to pass judgment on Plymouth Rock Studios executives’ grand proposal to bring to town what they called “Hollywood East,’’ the results of the vote were a foregone conclusion...And the chairman of the Plymouth Board of Selectman didn't seem bothered by any of the financial problems of the lead developer:
Soon, it was time for Plymouth’s town meeting members to debate tax breaks and re-zoning a golf course for 2 million square feet of sound stages, office space, retail businesses, housing, and a hotel.
Except there was no debate. Members voted to cut off discussion before it started, and hoots and applause filled the hall.
[Dick] Quintal has known for some time about Kirkpatrick’s bankruptcy and several of the lawsuits against him. And he accepted Kirkpatrick’s explanations.The utter failure of city officials and town meeting members to vet fully the developers and their financing is the lesson that Boston city officials ought to learn.
“I didn’t pay no attention to that,’’ he said. “That’s none of my business.’’
Could This Happen in Boston?
Boston itself has been beset by three recent messes of financing and oversight: Downtown Crossing, where city officials approved a development plan and allowed a building tear-down despite the project's inadequate financing; North Allston, where city officials approved Harvard University's proposal for a massive science complex, under the apparently false assumption that the university's vast endowment was more than enough to fund the project; and Columbus Center, where the state approved a development, including a promise of public money that was later withdrawn, despite the project's lack of financing.
All three projects are currently holes-in-the-ground with no short-term prospect for construction.
The Downtown Crossing example is the most worrying, since the Globe reported earlier this year that the Boston Redevelopment Authority "cut corners in allowing half a city block to be torn down," "set aside requirements for key disclosures and agreements," and "did not perform an examination of the developer's financing plans, which are not required under city rules."
Prediction: Flaherty to be Wifi-ed on Performance Bonds
In the mayoral campaign this year, candidate Michael Flaherty pushed the idea of requiring performance bonds for major development projects to ensure that they have adequate financing and complete the proposed work. At least one city official scoffed at the idea, calling it "a bit of political rhetoric."
As a result of the Downtown Crossing approval mess, Mayor Thomas Menino vowed that the city would more closely scrutinize project financing in the future.
I have a prediction on this one: Flaherty will get wifi-ed on the performance bond idea. I suspect that there are city officials, behind the scenes, who are more in favor of the idea than those who have spoken on-the-record. As a result, Mayor Menino will, within six months, take up the idea as his own and push for the BRA to implement it.
Expect Boston College's first proposed project in their institutional master plan -- likely a dormitory on the current site of More Hall -- to be an early test of what I predict will be a new city policy.
Update (11/16/09): I thought about drawing a parallel with the Wampanoag tribe's proposed Middleborough casino, but wasn't up to speed on the exact details of that ongoing scandal. Dan Kennedy, an avowed opponent of the plan, tweets, "Change "Plymouth" to "Middleborough" and "studio" to "casino," and you've got pretty much the same story."
Image of proposed Plymouth Rock Studios development project from the developer's website.