Peter P. O’Such Jr.
Guest Column
Developer’s use of historic tax credits to cost taxpayers $17 million
Mary Lou Strong’s inaccurate and apoplectic opinion piece which appeared in "The Hub" on Jan. 30 provided proof positive that my efforts to inform the public and the federal government of defects and flaws in the National Park Service/Fort Hancock procurement are succeeding. Despite the length of her diatribe, she once again is guilty of selective reporting. She fails to address and recognize that the Department of the Interior Inspector General (DOI, IG) is continuing its investigation of the NPS not adhering to the Historic Leasing Regulations, which even the NPS agrees are applicable and appropriate.
The NPS failure to follow these "historic leasing regulations" is the subject of my Sept. 22 letter to the DOI, IG (which the DOI, IG acknowledged receipt of Oct. 9). And contrary to what Ms. Strong stated in her article, I have read, and do indeed understand the procurement regulations which are applicable to this Fort Hancock procurement. I wonder if Ms. Strong has ever read them, and more importantly, understood them. Or did she take her beloved NPS’s word for it, or rely on the musings of some other adviser?
Ms. Strong charges that "no thoughtful program has been proposed by the opposition, or willingness shown to discuss any kind of alternative solution." Well, Ms. Strong, please take note of the following.
In keeping with the old saw that there is no such thing as a "free lunch," the Sandy Hook Partners’ use of historic tax credits will cost taxpayers an estimated $17 million, because this $17 million, which would have been collected, will not be collected by the U.S. Treasury due to the use of the historic tax credits by SHP. This loss of revenue will have to be made up by those taxpayers who do not have such tax avoidance options available to them. And that usually means the average taxpayer, the "little guy."
Why not directly budget and specifically designate these funds for the rehabilitation of Fort Hancock, eliminate the middleman (SHP), and keep the property available to the public and not the highest offeror, for the next 60 years without lining the pockets of a for-profit speculator?
Ms. Strong also charges that I have delayed the process. But if she were to examine the record for this procurement, she would see that the NPS failure to plan and act properly is the real, verifiable cause of the delays. If the NPS had conducted this procurement properly, I would not have anything to report to the DOI, IG.
It appears that Ms. Strong has acted in a very unfair and presumptuous manner when she stated that my motive for going forward and reporting my findings of procurement improprieties to the DOI, IG was to delay the process. As a retired federal procurement official, I believe it is most important that federal procurements be conducted fairly and properly. To do otherwise is a violation of the public trust.
Also troubling is Ms. Strong’s erroneous assurance that James Wassel’s Nov. 8, 1999, initial offer submission to the NPS RFP (Request for Proposal) satisfied the RFP mandatory requirement for having proven financial capacity to rehabilitate and run all 36 historic buildings included in his offer, which would cause Wassel’s financial capability needs to be among the highest. Yet, she states, "What the RFP actually called for was proof of the investor’s ability to obtain financing." Sorry, Ms. Strong, that is not what the RFP states. This requirement for "compelling evidence" was mandated of all offerors in Section 5 of the RFP and proof of possessing the needed financial capacity was to be included in the Nov. 8, 1999, initial offers. Without these assurances of financial capability, it would be impossible for the NPS to have properly selected SHP as the most advantageous offer.
But these alarming details do not appear to cause Ms. Strong any concern. The RFP required specific proof of possessing the needed financial capacity, such as letters of commitment, bearing the lending institution’s letterhead, and said letter "must include as a minimum the amount of the loan, amount of interest, term of the loan, and all encumbrances upon the loan." Yet, SHP is still searching for financial backing.
It is also interesting that Ms. Strong professes to have greater detailed knowledge of Mr. Wassel’s offer than what was provided to the public when the redacted/censored copy of Wassel’s proposal was released by the NPS. Most of what Ms. Strong tries to make her readers believe is not borne out by fact, especially the RFP or the redacted copy of the proposal. Where did you get this incorrect information? Who provided these inaccuracies to you? Ms. Strong, you need to be less trusting and get better sources of information.
One last bit of information, Ms. Strong. On Jan. 18, I received another letter from the DOI, IG dated Jan. 8, 2004, in which he thanked me for, and acknowledged, my two letters concerning Sandy Hook Partners’ lack of financial capability. I asked the IG: How could this be allowed? Over 2,000 petition signers and I want to know.
Peter P. O’Such Jr. retired from the U.S. Government General Services Administration seven years ago after nearly 30 years as a federal procurement official specializing in contracting, leasing, and regulation formulation. He is a resident of Fair Haven.