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F.B.I. Inaction
City drags feet on keeping
G-Men in Elm City — then scrambles under scrutiny
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Business New Haven
12/29/1997
By: Kevin Wheeler
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Close to 15 months after Mayor John DeStefano Jr. held a press conference to announce that the city had succeeded
in keeping the FBI in New Haven, the project for the new building is still not off the ground.
What's holding it up? A title clear and free of any easement rights to the designated site, which the city owns, so that a developer can obtain title insurance to protect its investment.
Right now, according to Robert J. Dunfey Jr. of the U.S. General Services Administration (GSA), which manages property for federal agencies such as the FBI, the property has been cleared of just one of three easement rights. And until the GSA has proof of clear title, it will not sign a memorandum of understanding with the city to cement the deal.
Currently, the only thing keeping the negotiations together is a letter of intent that DeStefano and Dunfey signed at the press conference on September 30, 1996, which says the city and the GSA will “enter into a ground lease with a private developer” so that the GSA can build a new headquarters for the FBI in downtown New Haven.
While that event now seems insignificant, it was an important turn of touch-and-go negotiations between the city and the GSA.
In 1995, the GSA announced that the FBI's 35,000 square feet in the Giamo federal building at 150 Court Street no longer met its needs. The site was too small, lacked sufficient parking and needed better security in light of the bomb that killed more than 140 people in Oklahoma City's Alfred P. Murrah federal building. The FBI saw no other appropriate site in New Haven and would be pack up and move out, said officials.
At stake were the preservation of 150 inner city jobs, spin-off business to local shops, retention of an agency with a $15 million annual budget, an estimated $200,000 in annual tax revenues, and productive use of a downtown property that had been dormant for 22 years.
For 18 months, Salvatore J. Brancati Jr., the city's director of business development, and DeStefano worked on the GSA and the FBI, with the help of U.S. Rep. Rosa L. DeLauro (D-3) and U.S. Sens. Christopher Dodd and Joseph I. Lieberman, to entice the agency to stay.
The complex solution involved leasing a city property (the former New Haven Arena site bound by Orange, Grove, State and Wall Streets) to a private developer who would build the FBI's 80,000-square-foot headquarters and then lease it to the FBI for no less than 20 years.
Perhaps to underpromise and overdeliver, no timetable for construction was announced at the time, but the FBI was expecting to enter its new regional headquarters in the fall of 1998.
It was a good tactic, but one that couldn't withstand bureaucratic inaction.
Jane Senk is responsible for procuring leases for the GSA. She says that although her agency has moved forward, soliciting and reviewing proposals from developers, it has not selected a developer because the title issue remains unresolved. “The GSA wants to make sure there isn't any confusion over rights to develop the site,” she says.
The city's Office of the Corporation Counsel is responsible for clearing the title. Deputy Corporation Counsel Michael Koenigsberg is handling the project for the city, which he describes as “a complex and unique project.” It is unclear whether the counsel's office is to blame for taking so long to clear the title or if it is taking the fall for someone else in the administration who dropped the ball.
Koenigsberg offers little insight into the matter, except to say that DeStefano had signed the latest version of the memorandum of understanding (MOU) and that it had been sent to the GSA for Dunfey to sign.
The city says that “The ball is [now] in the GSA's court.” But no matter how the city spins it the GSA is the client and it has the final word. And, unfortunately for the city, that means Dunfey, who questioned the quality of work from the corporation counsel's office on this project, will not sign off on the project without clear title.
Koenigsberg says he doesn't know how long he has worked on the title or when it will be resolved.
The GSA'S frustration over the hamstrung project is expressed by Dunfey, who says he is “not happy” with progress on the project, and by GSA attorney Nancy O'Connell, who would take no calls on the matter. Her secretary abruptly ended inquiries, apparently setting off a flurry of reaction.
GSA's Senk quickly called back to confirm that indeed Dunfey's was the only missing signature, and that the MOU had been express-mailed to O'Connell on or about December 17.
When Brancati was asked about the snag in, and tone of, negotiations, he said it had taken longer than anyone wanted and that there were just a few things to work out in the MOU. True: It won't be signed until the title is cleared.
Having masterminding many city development deals, Brancati responded quickly, resolving a 15-month sticking point in about an hour. Brancati called BNH back to say that he would obtain title insurance. How? “The city owns the property,” he said. “It's a question of money. I'll buy the insurance.”
Although Brancati committed to securing title insurance so that the project could get on the fast track, and Dunfey and Senk were glad to hear about the abrupt change, GSA sources wondered what company would provide insurance without clear title.
While Brancati and Dunfey from the beginning described the project as “moving forward” in spite of the setbacks, they parted roads on a time frame for completing the building: Brancati thinks the parties can still come close to making it by the fall 1998; Dunfey says the estimated occupancy date has been pushed back to spring 1999.
If Dunfey's right, there's a silver lining: he won't get his building on schedule, but he'll win $100. Merrill S. Parks Jr., special agent in charge of Connecticut for the FBI, bet Dunfey that his agency would be relocated by October 1998.
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