, Newburyport, MA

March 28, 2013

Mayor needs to disclose details of Millyard investment

Newburyport Daily News

---- — To the editor:

The mayor recently made public his response to an email circulating locally in which a resident raises questions regarding future private investment in the Lower Millyard project. Included in that response are the mayor’s following statements:

“As an example of the economic benefit for the city, one of the businesses in Dan Healy’s building is Fluidnet.

“(Fluidnet) received $19 million in venture capital investment to expand (their) business and hire software and hardware engineers.

“That’s $19 million of new business spending staying in Amesbury. Their presence in Amesbury helps our downtown shops and restaurants and their well-paid engineers will be buying homes in Amesbury.”

The mayor’s response concerns me in that he equates the $19 million in venture capital funding received by Fluidnet to $19 million of “new business spending staying in Amesbury.” As an entrepreneur, I can assure you that the two do not equate. A small fraction of the funding may end up being spent in town with most of it likely benefiting local restaurants and businesses, which is certainly a positive, but not much will end up in the city’s coffers. For example, Fluidnet’s rent will not incrementally increase the city’s revenue unless there are resulting increases in the assessment of Mr. Healy’s property. And as to newly hired engineers buying homes here, I wonder what will happen when they learn of our sky-high property taxes. Maybe surrounding communities will benefit, but Amesbury? Debatable.

My concern is that if the $90-plus million in private economic activity cited as a benefit from the LMY development is as poorly supported as the $19 million discussed above, the actual benefit to the city will be significantly less than the mayor is leading Amesbury to believe.

The mayor is surely aware that there are real concerns regarding LMY. Among the concerns are the realities of the economic benefits promised to the city and the contention that the economic activity will more than offset the city’s investment.

Therefore, I strongly urge the mayor to publicly disclose all details regarding the promised $90 million in private investment. Ideally this would include an analysis identifying and quantifying the individual projects and timing along with the accompanying returns that taxpayers can expect to see flow directly and indirectly to the city. This would go a long way toward allaying taxpayers’ fears and concerns.

I am a supporter of improving the LMY. Additionally, having companies like Fluidnet decide to stay in Amesbury is a very good thing. But poorly supported contentions leave opponents justifiably doubting that the $90 million is real. And that doubt significantly hurts the mayor’s cause.

Ken Gray