Re: Columbus Center
Columbus Center a curse - and a cause
Amid funding woes, political flap, developer Arthur Winn presses on
By Casey Ross
Globe Staff / March 29, 2009
During his down moments, Arthur Winn curses the day he conceived of Columbus Center.
Over the past 12 years, he has run a political gantlet trying to build it, straining to sculpt a plan to unite two of Boston's most exclusive neighborhoods with a towering complex over the Massachusetts Turnpike.
He visited with neighbors and city officials. He battled through more than 120 community meetings. He hired top-flight lobbyists to secure public money from the mayor, lawmakers, and two governors. At one point, his efforts even reached the Bush White House.
But lately, Winn, one of the nation's most successful developers of affordable housing, has found only controversy and misfortune in Columbus Center, with its troubles often plunging him into bouts of introspection. When asked about his reasons for wanting to build it, Winn spoke not about the project's mission or profit, but about his state of mind.
"I would have to be lying on a couch to give you an appropriate answer," he said.
"I had a chance years and years ago to buy the Celtics. I probably should have. And all these years later, I had a chance to build what I thought was the most exciting job in the history of Boston. Certainly, I didn't want to lose money on it, but maybe making money was not the first priority."
Winn's campaign for Columbus Center has fed a political drama that is remarkable even for Boston, where development is something of a blood sport. The project had high-powered enemies, including former House Speaker Sal DiMasi, who used his leverage to repeatedly block Winn's attempts to get public funding.
Although DiMasi left Winn damaged, it was Winn's friends and unfortunate timing that hurt Columbus Center the most. He got backing from governors Deval Patrick and Mitt Romney, but they proved unwilling to help at critical moments.
And then came the debacle with a former state senator, Dianne Wilkerson, a top supporter whose arrest on bribery charges has made her one of the project's most visible liabilities.
The controversy has left Winn fighting to preserve his reputation. It has also left him trying to rescue a project that has become a political taboo, incapable of attracting a supporter who will defend it in the light of day.
"There is nobody in the city who picks up the phone and says, 'Before you step up against this, know I'm going to smack you if you do,' " Winn said.
"They say it in New York. In Boston, it's an intellectual exercise between governing and insanity. There are so many different currents of motivation."
With Columbus Center, Winn proposes a 35-story condominium tower, stores, and hotel on 7 acres between Arlington and Clarendon streets. The $810 million project would connect Boston's Back Bay and South End neighborhoods over the open scar of the turnpike.
Wilkerson was the project's chief supporter in the Legislature, saying it offered the promise of thousands of jobs for her constituents. Winn said she was a longtime friend whose support was welcome, until the day of her arrest.
The former Roxbury senator was accused in October of accepting $23,500 in bribes associated with a nightclub and a development site in Roxbury. None of the charges were related to Columbus Center, but Winn was among the executives and officials who received subpoenas.
A few months later, Winn acknowledged he was one of a number of supporters who gave her money to pay off a large federal tax debt. His gift was $10,000; it came 22 months before Wilkerson sought $4.3 million for Columbus Center in the Legislature.
Winn has vehemently defended the donation, saying he gave it because he wanted to help a friend in trouble, not because he wanted to influence the public process surrounding Columbus Center. "There was never a quid pro quo between Dianne and me," he said.
Well before the Wilkerson controversy, however, Winn was struggling to get the project off the ground.
Between 2003 and 2007, its price tag doubled, to about $800 million, causing Winn to launch a lobbying blitz to secure millions of dollars in public subsidies. His main targets were economic development officials in the Romney and Patrick administrations.
"Arthur was all over the agencies. He was asking for substantial amounts of money," said Douglas Foy, who was secretary of Commonwealth development under Romney. "Our response was that he was welcome to apply for any help, but his requests were well beyond the normal operating boundaries of our grant programs."
The requests included $6 million from the Executive Office of Transportation; $15 million from the Department of Housing and Community Development; and $15 million in low-cost loans from the Massachusetts Housing and Finance Agency, according to public records.
The lobbying prompted Romney on Nov. 2, 2004, to file a letter with the state Ethics Commission because Winn was such a big political supporter - donating along with his relatives more than $46,000 to Massachusetts Republican committees during Romney's tenure.
The governor's ethics disclosure stated that Romney would play no role in reviewing Winn's funding requests. Such disclosures are filed to protect against conflict-of-interest allegations.
Still, at one point Romney made a high-level intervention on Winn's behalf: The governor called Andrew Card, then chief of staff to President George W. Bush, to press Winn's case for financial assistance from the US Department of Housing and Urban Development and from the government-chartered mortgage giant Fannie Mae, according a handwritten memo about the call that was filed in state housing records.
"Mitt called Card who called HUD to get FNMA [Fannie Mae] to stand by for Columbus Center," stated the memo, which the Globe obtained through a public records request. It is unclear from the memo when the call was made.
Romney said through a spokesman that he did not recall making the call. Card did not respond to requests for comment.
Columbus Center did receive $32.5 million in tax-exempt bonds from HUD, but nothing from Fannie Mae. And despite Romney's support, Winn only got $2 million from the Massachusetts housing agency.
A lifelong Republican, Winn initially fared better with the next governor, Democrat Deval Patrick, who is still in office. The Patrick administration approved a $20 million package of grants for Columbus Center that allowed Winn to begin construction in October 2007.
But the global credit crunch promptly undid that. Negotiations with Winn's primary lender, Anglo Irish Bank, collapsed, leaving him without a needed $430 million loan, and forcing Winn and his investment partner, the California state pension fund, to halt construction in March 2008. Weeks later, Patrick withdrew the state funding.
The project's management was trying to regroup in October when news broke of Wilkerson's arrest, leading to the subpoena, the ethical cloud, and more delays.
Today, Winn is a minority partner in Columbus Center, with a marginal role in the decision-making. The pension fund and its real estate consultants are now in charge of the project's finances.
Still, Winn said he intends to protect his $40 million investment and will continue to advocate for the project's construction.
"Whatever happens, I think for Boston the project should be completed for many reasons. It's so clear what the upsides are," Winn said, his voice rising. "I've been at this [expletive] for 11 years. I sunk a lot of time and effort in it, and I'd hate to see it die for many, many reasons, not the least of which is ego. But that's just no reason to go into a deal."
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