According to the latest report by Harvard’s Devens Economic Analysis Team, the fate of Devens Utilities, the MassDevelopment-controlled provider of electricity, gas, water, and sewer services, is “key to the long-term success of Devens and bears close monitoring and thoughtful stewardship.”
The Devens team members, led by chairman Victor Normand, presented their annual report last Tuesday to the Board of Selectmen. According to the report, “We believe it is likely that revenues from Harvard’s historic portion of Devens will exceed expenses within the next few years, given reasonable assumptions.”
The full report has been posted on the Devens Economic Analysis Team’s portion of the town’s website: www.harvard.ma.us/Pages/HarvardMA_BComm/DEAT/index.
Formed in 2010 by the Board of Selectmen, the Devens Economic Analysis Team was charged with assessing the financial status and potential of Devens, including, according to the recent annual report, “projecting a current municipal operating budget for Devens as if it were part of the Town of Harvard.” By analyzing eight towns with a similar commercial and residential makeup as Harvard and its historic portion of Devens, the team last year projected a $1 million deficit between tax revenue and municipal expenses, should Harvard resume jurisdiction over its part of the former military base.
Using the same “conservative methodology” this year, but with “updated information for expenses and tax revenues,” the Devens team is now projecting a $850,000 shortfall.
The report notes that “recent changes at Devens are encouraging,” citing the new regional dispatch center, a new tenant at the former Evergreen Solar plant, and a movie studio complex under construction on Jackson Road. About 4 million of the 8 million square feet of industrial and commercial land available under the current environmental permit at Devens has been developed, the team writes in the report.
“We think that a realistic, near-term, level of development prior to disposition is 6 to 7 million square feet,” the report says.
The team notes that nine of the 11 parcels currently for sale in Devens are within the historic boundaries of Harvard; “Redevelopment of the Ayer portion of Devens is essentially complete.”
One big unknown for the future of the Devens economy, according to the Devens Economic Analysis Team’s report, is what happens to Devens Utilities. According to the report, MassDevelopment, the quasi-state agency that oversees Devens, has the right to decide the future of Devens Utilities without approval from the three towns whose historic boundaries fall inside Devens: Harvard, Ayer, and Shirley.
Operated like a municipal utility exempt from property taxes, Devens Utilities currently makes a payment in lieu of taxes (PILOT) to MassDevelopment. It paid $1.5 million in fiscal years 2010 and 2011. In fiscal year 2011, Devens Utilities charged the fourth-lowest electrical rate among municipal utilities in Massachusetts, at 11.89 cents per kilowatt hour (compared to the rate of 16 cents charged by commercial provider National Grid in Harvard.)
“We believe that Devens Utilities is a jewel to be treasured; its function is critical to the success of Devens and the regions,” the Devens team wrote in their report. “Its competitive rates are a major reason that businesses are attracted to Devens and remain at Devens. Ayer, Harvard, and Shirley have a chance to receive a substantial yearly payment in lieu of taxes from Devens Utilities, if it is converted into a municipal utility.”
The team writes that selling Devens Utilities to an investor-owned utility could “result in the utility rates rising, destroying a major advantage of Devens over other regions of New England.”
Harvard has yet to take an official stance on the disposition of Devens. The Planning Board is preparing to issue a request for proposals for a consultant to manage an economic impact analysis of the issue (see related story on page 1).
In a Special Town Meeting Monday, Ayer voters rejected a warrant article to petition the state Legislature to take back that town’s historic portion. According to reports, those speaking against the proposal cited a lack of information on the economic future of the zone.
