Rivals criticize Menino over stalled Downtown Crossing project

Say development of Filene's site was mismanaged

Incomplete construction at the site of the Filene's building at Downtown Crossing has been called a blight on the neighborhood. Don Jones walks by it several times a week while working. (David L. Ryan/Globe Staff)

Candidates vying to unseat Mayor Thomas M. Menino accused him of mismanaging a major development site at the former Filene's building at Downtown Crossing, saying the city acted without necessary safeguards when it approved demolition at the site.

"Mayor Menino loves to give speeches at ground-breakings, but when the going gets tough, he refuses to take any responsibility," said Councilor Michael Flaherty, one of three announced candidates for mayor in 2009. "Because of his mismanagement, a New York company now controls Downtown Crossing."

A Globe story yesterday said the Boston Redevelopment Authority cut corners in allowing half a city block to be torn down. It set aside requirements for key disclosures and agreements. It also did not perform an examination of the developer's financing plans, which are not required under city rules.

The Globe story said Menino, in response to the eyesores and stalled dreams in a critical neighborhood, vowed to require more rigorous financial reviews for future development projects.

The city also said the idled Downtown Crossing development was an unforeseen casualty of the sudden economic crisis, not a situation that could have been prevented with greater scrutiny.

The developers - John B. Hynes III and Vornado Realty Trust - have not worked on the site since last year, saying they have been unable to obtain loans in the current economic climate. Instead of the promised $700 million development, the site now consists of a huge hole in the ground and two partially demolished buildings, including the former Filene's, a historic landmark.

Responding to the criticism, mayoral spokeswoman Dot Joyce said yesterday that Menino considers the Filene's site "the nucleus of that neighborhood, and that district has always had a special place in his heart."

"These frozen funds will thaw, and projects will begin moving again," she said.

Candidate Sam Yoon, also a councilor at large, called the handling of the Filene's project a "glaring failure."

"When an institution's weaknesses are exposed like this, the discussion really should be about management and accountability," he said. Yoon said the fenced-in hole at the heart of busy Downtown Crossing "makes me question whether or not we're truly a world-class city."

Candidate Kevin McCrea, a businessman and activist, said the mayor and the Boston Redevelopment Authority put the developers ahead of the city.

"I certainly don't mind working with developers and trying to work your way through things, but when we have completely nontransparent developments and a nontransparent BRA, it doesn't give the citizens much faith that we're going to get anything out of these deals," he said.

Developers also said criticism of the Redevelopment Authority and calls for developers to prove they have financing or otherwise guarantee projects might make good political fodder, but are impractical. David I. Begelfer, chief executive officer of the Massachusetts chapter of the National Association of Industrial and Office Properties, said developers already think Boston's application process is lengthier and more cumbersome than those in other major cities.

"One thing we have not suffered from is a cascade of developments dotting the horizon," Begelfer said. "If anyone is running on a campaign to say they need to slow down the permitting in Boston, I don't think that's the right party to lead the city."

City Council President Michael P. Ross countered that more oversight is needed of developers and the BRA, not less.

"It shouldn't be easy to come into town and just rip down buildings. Developments should have to pass a hurdle," Ross said.

The BRA held a closed-door meeting with the developers yesterday to try to coax them into action. With prompting from Menino, BRA director John F. Palmieri said, the agency encouraged them to restart the project or seal off the site within the next few months.

"They understand that the condition of the site is unacceptable," Palmieri said. "We want them to redouble their efforts to create a development program, and if they are unable to put something together and get something started by this summer, [they will need to address] the blight that exists there and do certain things to button-up the site and make it look attractive."

The original plans - for a 38-story mixed-use development with retail and office space, an underground parking garage, 250 hotel rooms, and 166 condominiums - could be scaled back considerably when the project eventually restarts, Palmieri said.

The director and others at the BRA have said the skipped steps were not a violation of city ordinances but a reflection of an expedited practice used about 10 percent of the time, to aid complex but well-planned projects.

Flaherty said this situation and the stalling of Harvard's developments in Allston are two examples where the city would have benefited by requiring a performance bond or a guarantee that a project will proceed. Despite the recession, Harvard has an 11-figure endowment, while Vornado Realty Trust reported $395 million in net income in 2008, even after a fourth-quarter loss.

"Someone needs to stand up for Boston" and require developers to spend more of their own money while seeking credit, Flaherty said.

McRea, a frequent BRA critic, wants to abolish the redevelopment authority and replace it with what he calls a more open, citizen-minded planning process.

Yoon said dissolving the BRA would be premature, though the agency needs to be less of a mayoral "rubber stamp."