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HomeMy WebLinkAboutMassDev UPP compliance HAC June 2026 from Fitzgerald 1 June 6, 2026 Navjeet K. Bal, President and CEO MassDevelopment Finance Agency 99 High Street Boston, Massachusetts 02110 nbal@massdevelopment.com Re: Request for Review - Underutilized Properties Program Grant to Housing Assistance Corporation for 460 West Main Street, Hyannis Dear President Bal: I am writing as a taxpayer and resident of Cape Cod to ask MassDevelopment to review the $354,000 grant it awarded to Housing Assistance Corporation (HAC) under the Underutilized Properties Program (UPP) for 460 West Main Street, Hyannis. I raise three specific issues. First, 460 West Main Street did not meet the UPP program’s statutory eligibility criteria at the time of HAC’s application. The property was actively occupied. HAC’s application contains an internal contradiction on the vacancy question. At 460 West Main Street, HAC created a vacancy by moving out, and created future vacancy with a federal ARPA grant, with other tenants getting an extended contractual right to remain in the building – then, HAC applied for a UPP grant to renovate the result. Second, HAC did not provide a letter of support from the municipality as required by UPP Guidelines. The letter HAC labeled as the Town of Barnstable’s letter in its application was a personal letter from a single Town Councilor acting in his individual capacity. Third, the certified application describes HAC’s intended use of the property as Dover-exempt without explaining the basis for that exemption. This is despite HAC having told Barnstable County Commissioners in its 2024 ARPA application for the same property that the Dover basis was educational, and later telling the Town of Barnstable it was religious; the religious use status of the property is currently subject to a ZBA appeal. I am not a lawyer, and I am not making a legal argument. I am a taxpayer raising straightforward questions about program eligibility, application accuracy, and MassDevelopment’s communications. Issue 1: 460 West Main Street Did Not Meet UPP Eligibility Criteria and HAC’s Application Contained Contradictions and Omissions The UPP program's authorizing legislation (the 2024 Mass Leads Act, as reflected in MassDevelopment's program guidelines) defines eligible projects as those that will "improve, rehabilitate or redevelop blighted, abandoned, vacant or underutilized properties." MassDevelopment's evaluation criteria state that applications will be reviewed for the likelihood of requested funding to "advance a project towards increased occupancy," and that applicants must demonstrate economic benefits "enabled by the increased occupancy" of the property. 2 HAC's application (FY26, Application ID FULL-FY26-Barnstable-Housing As-Assistance- 00659, certified June 4, 2025) contains an internal contradiction on the vacancy question. In the Building Details table (Section 4.2), HAC answered "Yes" to the question "Is the property currently vacant?" and stated an overall vacancy rate of 50%. Yet in the floor-by-floor breakdown in the same table, HAC stated that the second floor is 10% vacant, with present use described as: "Second floor is currently occupied by two tenants — Cape Cod Healthcare and South Coast Legal Services." Section 4.3 confirms: "The second floor is occupied by Cape Cod Healthcare for behavioral health appointments and South Coast Legal Services. Both entities are lease agreements which end in December 2025." Section 2.20 states: "Two tenants remain on the second floor and have leases which expire in December 2025." MassDevelopment should explain how it evaluated vacancy eligibility given this internal contradiction. Cape Cod Healthcare and South Coastal Counties Legal Services were not standard commercial tenants. They were co-owners with HAC of Asclepius Corporation, the entity that held title to 460 West Main Street. HAC used the $3,000,000 federal ARPA grant to purchase their ownership interests, and their continued occupancy was a negotiated condition of that buyout. The County ARPA grant agreement, executed November 20, 2024, gave both parties the right to remain in the building for up to two years from closing — running to approximately late 2026. The MOU signed December 18, 2024 and attached by HAC to the UPP application, confirms the same: CCHS for up to one year, SCCLS for up to two years. Both documents were in HAC's possession six months before HAC’s CEO Magnotta signed the June 4, 2025 certification. HAC’s application describes these parties as tenants with leases expiring December 2025. It does not disclose that their right to remain derived from a federally funded ownership buyout, and it understates that right by more than a year. On June 4, 2025, HAC's CEO certified that the application was true, accurate, and complete, including the December 2025 lease expiration date that documents contradict. Beyond the contradiction, the vacancy HAC does describe - the first floor - is vacancy HAC itself created. Section 2.20 states that "Housing Assistance moved their office headquarters to the first floor of the building in 1985 and operated there until they relocated to 255 Independence Drive in Hyannis in January 2025. This left the first floor vacant." Section 2.6 confirms: "The first floor of the building was being utilized as an office space." HAC relocated its own headquarters to a property it had purchased six months before this application was submitted. The first-floor vacancy that forms the basis of HAC's eligibility argument was created by HAC's own planned move, not by any pre-existing blight, abandonment, or distress. In HAC's public benefit narrative (Section 4.1), HAC argues: "Eliminating Blight — The first floor of the building is currently vacant leaving it vulnerable to the poor appearance of unoccupied buildings and the high possibility of vandalism." The blight HAC asked MassDevelopment to fund remediation of is blight HAC chose to create - by moving its offices to a new $5.6 million property with a deed restriction against sheltering the homeless for a defined period. HAC reported to the County Commissioners that it used federal homeless grant funds to renovate those new administrative headquarters at a property where it committed not to shelter the homeless. HAC stated in a press release that MassDevelopment gave it a grant for that office property as well. 3 Through a public records request, I obtained MassDevelopment's list of FY26 UPP awardees. I appreciated MassDevelopment’s responsiveness. Other funded UPP projects involve a property whose distress preceded and was independent of the applicant's actions: closed nursing homes, decades-vacant mill buildings, flood-damaged facilities, municipally-sold historic schools, bankrupt retail chains — properties described in MassDevelopment's own award language as "abandoned," "blighted," or "vacant for multiple years." MassDevelopment's award memo for the HAC project contains no such language. Issue 2: HAC Labeled a Single Councilor’s Personal Letter as the Town of Barnstable’s Letter of Support MassDevelopment’s UPP Guidelines require a letter of support from the municipality. The Town of Barnstable did not provide one. There is no record of HAC asking the Town for support. Instead, HAC’s application includes a letter dated June 3, 2025, from Matthew P. Levesque, Barnstable Town Councilor, Precinct 10. The letter is written on Town of Barnstable Town Council letterhead and lists all thirteen councilors on its left margin. It is signed only by Councilor Levesque in his individual capacity. It is not a vote, a resolution, or any form of official Council communication of the Town Council. Councilor Levesque speaks only for himself; there is no record of him in agendas, minutes or recorded meeting videos disclosing to the Town Council his intent to send a letter or seeking other Councilors’ views. In the application’s attachment list, HAC filed this letter under the description “Letter of Support- Town of Barnstable-Mass Development-UPP Grant 6-25.pdf” — labeling it as the Town of Barnstable’s letter. HAC’s letter label is not accurate. A letter from the Town of Barnstable would require an institutional act: a vote or resolution of the Council, or some official communication on behalf of the municipality. Councilor Levesque’s letter is none of those things. Even his letter does not affirmatively support the project. He states that he personally would not “support standing in the way of an organization, which has by right zoning, pursuing to better its facility.” That is a statement of individual non-opposition. Councilor Levesque also states that the building was vacant when it was not. HAC provided letters from other officials it preferred: a state representative, a state senator related to HAC’s Chief of Staff, and a member of Congress. Those are not letters from the municipality. Notably, there is no record of any of those non-municipal officials going to the Barnstable Town Council to discuss whether the municipality supported HAC’s proposal. The municipal letter requirement exists specifically to establish that the local government as an institution supports the project. The Town of Barnstable has not expressed that support. The Town’s School Committee formally asked HAC to consider other locations. The Town’s attorney issued a written opinion concluding the proposed use is not religious and therefore not protected from local zoning. The Town’s Zoning Board of Appeals is currently hearing an appeal of the Building Commissioner’s determination. MassDevelopment should explain on what basis it concluded that a single councilor’s personal letter, mislabeled in the HAC application as the Town’s letter, satisfied the municipal support requirement. 4 Issue 3: The Legal Use Status of the Funded Property Is Actively Contested For the record: HAC’s application disclosed the Dover Amendment as a zoning strategy but did not characterize the basis for the exemption. HAC described only an “exempt use” without stating whether that exemption rests on religious or educational grounds. Those are distinct uses. Before the award, HAC’s then-Chief Legal Officer Robert Brennan emailed a MassDevelopment employee characterizing the intended use as Dover Amendment-exempt religious ministry by Catholic Charities, attaching HAC’s Town submission about religious use and AG guidance. The MassDevelopment employee replied on August 7, 2025: “Although we all know that this is exempt from local regulations, it would be great to have the letter from them if you are expecting one.” The Barnstable Building Commissioner issued formal written findings confirming the religious use determination on April 3, 2026. That determination is currently under appeal at the Barnstable ZBA. The Town’s attorney has issued a contrary legal opinion concluding the use is not religious. The ZBA has not yet ruled. I am asking whether MassDevelopment considers an active, unresolved ZBA appeal over the legal use status of a property it has funded to be material to the ongoing terms of its grant, and what its practice is when a funded property’s intended use becomes subject to contested regulatory proceedings. One additional observation on the Dover question. The word "religious" does not appear anywhere in HAC's certified UPP application. Not once. HAC’s application mentions Dover four times and quotes HAC's Town submission in Section 2.20, but describes only an "exempt use under the Dover Amendment" - without ever stating the basis for that exemption. The basis matters because HAC had already stated it in writing to another public funder. In connection with the ARPA application updated in mid-2024 that funded this same property, HAC told Barnstable County that the Dover exemption rested on educational use, citing the ARC's planned educational services. HAC told the Town of Barnstable the property would have religious use. The Town’s Building Commissioner's determination - issued after the UPP grant was awarded - rests on religious use. Educational use and religious use are legally distinct bases under the Dover Amendment. The sequence is this: HAC told the County the basis was educational. HAC told MassDevelopment only that Dover applied, without stating why. HAC told the Town of Barnstable the basis was religious. The Building Commissioner then confirmed the use was religious. HAC's application quotes its own Town submission but omits the religious basis that submission relied upon. On June 4, 2025, HAC's CEO certified that the application was true, accurate, and complete. Whether that certification is accurate given that the application omits the basis for its central legal strategy while HAC's only prior public characterization of that basis is inconsistent with the determination that followed is a question for MassDevelopment. 5 In addition to the questions raised above, I ask MassDevelopment to address the following questions: 1. Review whether HAC's application accurately represented the vacancy and tenancy status of 460 West Main Street, given: the internal contradiction between the "currently vacant" checkbox response and the floor-by-floor disclosure of active tenants in the same section; the application's statement that those tenants held leases expiring December 2025, which understates their documented contractual right to remain by more than a year; and the application narrative's failure to disclose that those tenants were co-owners of the property HAC purchased with federal funds. 2. Explain on what basis the municipal letter of support requirement was deemed satisfied by a personal letter from one of thirteen Town Councilors, filed in the application under the label "Letter of Support-Town of Barnstable." 3. State whether MassDevelopment considers the active, unresolved ZBA appeal over the legal use status of 460 West Main Street to be material to the ongoing terms of its UPP grant and describe MassDevelopment's practice when a funded property's intended use becomes subject to contested regulatory proceedings after an award is made. 4. Explain whether the certified application's silence on the basis for the Dover exemption - given that HAC's prior public characterization of that basis for this property described educational use, while the Building Commissioner's subsequent determination based on HAC’s religious use advocacy - satisfies the completeness requirement of the certification HAC's CEO signed. 5. Describe what steps MassDevelopment takes when, after award, it determines that a funded property did not meet program eligibility criteria, that material information in the application was inaccurate or omitted, or that the applicant held documents contradicting the application's representations at the time of certification. I am raising these questions because a significant amount of public money is involved and because MassDevelopment’s own records raise questions that merit a written answer. Please provide a written response within 30 days. Respectfully submitted, Sandra Jones Fitzgerald Barnstable, Massachusetts cc: Office of Governor Maura Healey by certified mail MassDevelopment Board Chair and Secretary of Economic Development Eric Paley, eric.paley@mass.gov