First lets update you on Green Hill and Union Station.
Green Hill
It continues to lose money. In FY16, it lost $187,235. How has it done the past ten years?
- FY 2015 -228,000
- FY 2014 -214,776
- FY 2013 -223,786
- FY 2012 -134,303
- FY 2011 -187,712
- FY 2010 -151,930
- FY 2009 -115,917
- FY 2008 -41,023
- FY 2007 -88,553
- FY 2006 -144,940
- FY 2005 -76,579
Does anyone really believe that the $800,000 we are investing in a driving range will reverse these losses? BTW, what is the status of this driving range? Do not forget that the revenues are coming in $217,000 less then estimates for FY17, so we may be looking at a record breaking loss.
Good news is that the City Council did have a vote on Green Hill this week:
12o) That the City Council of Worcester does hereby recognize and congratulate the Administration’s efforts, as the Green Hill Golf Course was recently awarded the Worcester Business Journal’s Best of Business 2017 Award for being the Best Public Golf Course.
You can watch, click here, at 1:07:00 for 2-3 minutes.. The vote passed 9-2 (Gaffney & Lukes). We are not saying Green Hill did not deserve this honor, they did, but we are saying we would like to see votes addressing how we are going to deal with these losses?
Union Station
Two weeks ago we covered some of the financial hi-lights, click here:
- operational losses exceed $2,000,000 dollars per year
- negative cash flow is approximately $1,200,000 per year
- loans that the WRA, Worcester Redevelopment Authority, from the City of Worcester will never get paid back since the WRA is in essence the City of Worcester
- $6,250,000 project is planned for leak remediation
- $10,000 is being spent on a study to fix the flag poles
If we could get a buyer for Union Station that would keep it a train station, like Massport has kept ORH and airport, we would only have $5,000,000 in outstanding debt to pay back. Based on the fact the train station has an annual revenue of $500,000, we think that we could sell Union Station. If we were to get a price of $5,000,000, for example, the City of Worcester would save:
- $1,200,000 in negative cash flow each year
- $6,500,000 between principal and interest on the remaining $5,000,000 of debt
- hopefully find a for profit owner to put this property back on the tax rolls
Since then what have we seen?
#Worcpoli city manager says he would consider having @TweetWorcester take over ownership of Union Station from #Worcester Redevelopment Auth https://t.co/R2k90B8xRK
— Nick Kotsopoulos (@NCKotsopoulos) February 11, 2017
If the City of Worcester were to take ownership of Union Station from the WRA, this would be akin to you or I taking our credit debt on our MasterCard and moving it to our VISA card.
Conclusion
Green Hill and Union Station are assets just not for the taxpayers of Worcester, no different then the airport was before Massport took over ownership. Considering the two most important jobs of the City Council are:
- Preserve and increase the tax base
- The budget
The City Council needs to put both of these “assets” out to bid and find owners or management companies that can truly make these assets to the taxpayers. Right now these two assets are only liabilities to the taxpayers of Worcester.
Addendum
Check out this company, Ashkenazy Acquisition, and some of their real estate holdings:
