The debate around Marian Walsh’s hiring at HEFA has largely focused on her salary and political relationships. But there is a larger issue at stake here and that is the Patrick Administration’s drive to obtain political power over the patchwork of quasi-independent agencies that administer significant funding and/or infrastructure systems. Is it a good thing to see the Administration take control of these Boards and Commissions in the manner they have?
On the one hand, the unaccountable fiefdoms that some of these agencies had become, with their abusive pension and pay policies, was a black mark on the workings of State Government. Seeing tolls continually raised by officials that were not accountable to the public, and often were holdovers from a previous administrations, was dysfunctional and anti-democratic.
And yet, while I believe the Patrick Administration generally has good intentions in seeking to overhaul these bureaucracies, with an eye toward bringing coherence and new focus to outdated structures, I wonder whether there remains a place and case for independent agencies at arms-length from politicians. The direction of travel is clearly to bring these bodies back under the political control of directly elected leaders. But there are potential downsides to such control, especially as future Governors may not share the Patrick agenda.
Ultimately the pendulum will always swing back and forth as to whether we need more independence or political accountability. There is a case for both and I am wondering if a happy medium can ever be drawn between the two and if the Patrick Administration has crossed a line that undermines their independence for the long-term.
See, here’s the catch. The reason people didn’t know about HEFA is because it has done its job quietly and efficiently. Same with MassDevelopment. MassDevelopment has made a lot of money because the state placed well-qualified, well-compensated people in charge, and in return MassDevelopment has been VERY successful over the past decade.
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p>Same is true, to an extent, with MassPort. For a while, MassPort was a mess, back when it was being run by Virginia Buckingham and Mark Robinson, with George Cashman sitting on the board of directors. But after 2001, they were forced to professionalize, and it has been running relatively smoothly ever since.
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p>(Sure you can complain about paying for drycleaning, but if that’s the biggest transgression, that says something on its own)
That authority could be run from a desk with one person plus an assistant:
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p>1: A charity needs financing.
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p>2: Charity calls HEFA. Guy at the desk answers phone, looks up an underwriter on his rolladex, calls up an underwriter who’s just dying to issue bonds or do a sale/leaseback for a fee. Underwriter does what it takes from that point forward (attorneys, accountants…) to structure and execute the deal.
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p>3: Because HEFA is an State Authority, the deal is structured by the underwriter so that HEFA is issuing the bonds. As the facilitator, HEFA issued bonds are tax free with proceeds and risk passing to the charity.
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p>4: HEFA gets a fee.
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p>Here’s what we know: (1) HEFA is small. $4 to $7 million in revenues. (2) they expand even when the economy contracts. Just last year they added 2 execs costing $325K total. (3) they perform a useful task. They act as a conduit to exploit a tax loophole that allows non-profits the ability to issue taxfree bonds.
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p>We never heard, i) why the position was essential ii) what her qualifications were iii) what the job description entailed iv) what the late told business about a merger with MassDevelopment and how that would save us money.
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p>Interesting they were so quick to point out that the position wasn’t taxpayer funded and wouldn’t cost us anything, yet somehow merging the Agency saves us money.
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p>In short, Patrick defended his pick, but never said why.