Greenway Uncovered (GU) is a 20-page report (pdf) recently released to the media by “employees and volunteers of Rose Kennedy Greenway Conservancy, both past and present.” The report is anonymous and any specific motivation is unclear other than that stated in the report that “silence is neither golden nor in our own interest.”
The Greenway Conservancy (GC) responded with its own “informal inquiry” strongly countering the GU allegations, finding “no improper conduct” and recommending no further action be taken toward a formal investigation.
The GU “whistleblower” report is a compilation of critical assessments regarding Conservancy spending, especially toward executive salaries and public art. Specifically, the document takes aim at last year’s $2.6 million Echelman Project, originally estimated to cost $500,000. The vast overrun appears inexplicable given the artists experience having installed similar displays in several other cities. In speaking with Conservancy executives and board members, there were indications that the project could cost significantly more early on, but the GC board and staff decided to “take the risk” with the support of private donors who stepped up to fund the higher price. At the time of its unveiling, the Echelman Project was met with nearly universal positive reviews as the “most galvanizing piece of public sculpture in Boston in living memory.”
Rejecting the Conservancy’s reported separation of public and private financial line items, the GU report assumes “all money is fungible” and therefore concludes that State dollars are being misspent on an oversized staff, public art and executive salaries. The Greenway is a State park, regulated by MassDOT, and receives $2.1 million in public funds or 40% of its budget toward the constrained use of maintenance and horticulture. [See Greenway Conservancy Financials Reflect State Support, Public Art Focus & Higher Salaries.]
The Conservancy responded to the report by directing an informal inquiry (8-page pdf, July 24, 2016) under its whistleblower policies. The inquiry was conducted by Bud Ris, a relatively new board member and co-chair of the finance committee. Ris is the former head of the New England Aquarium and was not on the Conservancy board at the time of the alleged improprieties.
The Conservancy’s inquiry concluded that a formal investigation is not necessary because its informal inquiry concluded that “complaints in the GU document are not allegations of Improper Conduct. They are instead criticisms of the GC’s management approach, organizational priorities, staffing and spending decisions, or board effectiveness,” said Ris in his review.
The State Auditor’s Office responded to the whistleblower report with newspaper headlines saying it would audit the Conservancy. Since these statements in April 2016, however, the office has made no discernible effort toward completing such an audit, nor is one cited in its public disclosure.
The next meaningful review of the GC will be most likely by MassDOT in preparation for the June 30, 2017 lease renewal of Greenway land. Calls to wean the GC from MassDOT’s State funds have subsided in recent years, including a turnabout by none other than former Transportation Secretary, Richard Davey, who now favors continuing the state subsidy. In a recent Commonwealth Magazine piece, Davey comments,
“Whether one believes that MassDOT should support the park or not, the reality is that the park is owned by MassDOT, serves as the roof of the O’Neill tunnel, and was a key promise in the development of the Central Artery/Tunnel project. The state cannot walk away from its obligation to keep the tunnel in a state of good repair, and that includes what sits on top of the tunnel.”
The Secretary’s piece appears to reflect a growing consensus by some board members, staff and stakeholders for the Conservancy to pursue new food truck-like income streams while requiring abutting real estate owners/developers to support the parks. The latter issue would likely require MassDOT and other public officials to wrangle cash from these private developers/owners that surround and benefit from the Greenway parks. Unlike waterfront development, however, there is no overriding legislation such as Chapter 91 to make this happen. It is notable, however, that Governor Charlie Baker was one of the original Greenway board members and continues to imply his support of the parks.
The GC inquiry reviewed the Greenway Uncovered allegations in categories. While the rebuttal focused primarily on the question of “improper conduct,” it also offered observatory remarks in response to the allegations made in the GU report. Below is a summary of the specific GU allegations and abbreviated GC responses.
GU Allegation: The Echelman Project went overbudget by more than $1.5 million. GC reports hide the cost breakdown giving private donors false information. MassDOT funds were used to pay for the shortfall. RFP process for contracts over $100,000 were not followed.
GC Findings: The project was estimated at $500,000, but the board understood the risks associated with such a major undertaking. The expenses for the Echelman project were paid with restricted or unrestricted funds from private donors and foundations and earned income. No MassDOT funds were used for the Echleman Project and no evidence of misled donors was found.
Use of MassDOT Funds
GU Allegation: The GC misappropriated public funds from MassDOT for the Echelman Project, “… to pay for the shortfall and cover project-related personnel expenses. Management masterfully hides the facts.”
GC Findings: No MassDOT funds were used for the Echelman Project. MassDOT funds are only used for maintenance and horticulture with reports provided to the State agency.
Ed: Not included in the either report, there was some public funding funneled to the project through public art grants totaling approximately $100,000.
GU Allegation: There are multiple statements in the GU document criticizing the expansion of the GC’s staff.
GC Response: GC employees increased by 3 full-time equivalents over the past year to 33, a reasonable increase of 11%.
Horticulture and Maintenance Costs
GU Allegation: The RKG is “one of the most expensive parks in America. It cost the Conservancy a record $420,538 (per acre) in FY 2015.”
GC Response: H&M costs are less than alleged, but the care of the Greenway is more than average because it is located over a tunnel and includes high maintenance features such as fountains. Past studies have shown costs are comparable to other flagship parks in other cities.
Executive Director Compensation
GU Allegation: Executive Director Jesse Brackenbury received a 30% increase in salary to $210,000.
GC Response: The board reviews comparative compensation data and the ED salary does not appear to be inconsistent with the market data collected for this assessment. The increase was a 17% increase over a 17-month period and is reported on IRS Form 990 as required.
GU Allegation: “Costs of fundraising are extravagant averaging 32% in 2015 and 50% in 2016.”
GC Response: The GC’s fundraising efficiency improved from 64% to 30% over the three-year period ending in 2015. During the same period, the organization’s ratio of fundraising expenses to overall expenses improved from 12% to 9%.
Fiscal Year Change
GU Allegation: The GC changed the term of its fiscal year as a means of “budgetary manipulation” to cover up costs of the Public Art/Echelman Project.
GC Findings: The decision to change the fiscal year was purely an operational decision that was implemented for reasons that had nothing to do with the Echelman Project.
GU Allegation: “The board is accomplice of the management’s practice of unbudgeted projects…” “The board functions as a “ceremonial and rubber stamp board. Leadership uses the tactic of assigning board seats to key stakeholders (City, Mass DOT,etc) and by implicating them in the process, it avoids inspections and shun criticism.”
GC Response: The GC’s enabling legislation requires the assignment of board seats to appointees of various public officials including the Governor, the Mayor, MassDOT, and members of the state legislature. Financial statements are audited and “present fairly, in all material respects, the financial position of the Rose Kennedy Greenway Conservancy” in accordance with generally accepted accounting principles. Neither the “clean” audit nor subsequent discussions with the FARMC suggested any evidence of mismanagement of public or private funds nor any lack of financial internal controls. The GC’s audit, 990 filings, and other financial statements can be found on the GC’s website.