Attorney General’s Office Reviewing Complaint on Sale of Old YMCA Building

March 3, 2017
By

By Seth Daniel

The Attorney General’s Office confirmed that a complaint has been filed by one of the unsuccessful bidders on the Chelsea Community Center (CCC) building (old YMCA) on Shurtleff Street, and they are reviewing that complaint.

Emily Snyder of the Attorney General’s Office said the complaint from East Coast 3 Realty Trust, with one of the members being Revere businessman Charlie Lightbody, has been filed. Guidelines for the Attorney General’s Office indicate that a review does not constitute an investigation, so there is no investigation ongoing at this time.

“Yes I did file the complaint,” said Lightbody. “This is not a good situation in my opinion. A charity non-profit has to go through a review. I was the high bidder by a long shot, by more than $500,000, and my terms were good. I was going to close quick and give them the money they need quickly as a deposit. I don’t know why I wouldn’t have gotten the property and I haven’t gotten an answer yet from them. Maybe the Attorney General will be able to find out.”

The situation unfolded last month when, strapped for cash, the CCC Board of Directors decided to put the mixed-use building up for sale. Three known bidders originally were said to have put in bids, including the City of Chelsea. The winning bid, however, went to local developer Jim D’Amico for $950,000 – the same bid as the City. The City had hoped to put a Youth Center in the basement and first floor, similar to what exists there now. They would have then tried to develop the residential units upstairs into affordable housing.

However, D’Amico apparently got the vote of a majority of the Board. By state law, two-thirds of the Board members are needed to reach an affirmative decision.

D’Amico did not return a call from the Record to discuss his apparent winning bid.

Lightbody and his partners, including the Trust Manager Joe Mattarese, submitted a bid on the day of the Board meeting for $1.5 million. They said they submitted their bid once again at a second Board meeting on Feb.

Lightbody said he bid over the City’s Assessed Value on purpose and even considered going higher to $2 million. He said he thought the property was going to command a pretty penny. He said he was shocked that no one beat his bid, and further shocked that the winning bid was so far below his.

The building is valued by the City for real estate taxes at $1.297 million.

According to a fact sheet provided to the Record from the AG’s Office, most sales by a non-profit have to be noticed and reviewed by the AG’s Office. Some sales have to also have approval of the Supreme Judicial Court.

In the case of the CCC, it appears likely that an AG notice, and potentially court approval, are necessary.

In that fact sheet, one question is whether or not it is allowed for a public charity to sell substantially all of its assets to a for-profit company.

“Yes, so long as the charity can establish that it received fair market value and otherwise complies with applicable law,” read the fact sheet. “If the charity intends to change its activities or dissolve, notice and court approval is required. In addition, other requirements may be placed on the buyer to share with the charity profits realized on future sale of the property within a specified time period to ensure that the property was not undervalued at the time of the sale.”

It is uncertain if the CCC plans to dissolve, but without a Center to serve the community, it would seem impossible for the mission of the charity to continue.

The CCC appears not to be interested in continuing to operate the community center and fitness club, as the City is pursuing the ability to take over that function for it’s long-sought-after Youth Center. In that case, according to the fact sheet, it would appear that the sale would require Attorney General notice and court approval.

It would also have to show that it got fair market value for the sale.

The apparent winning bid by D’Amico came in more than $300,000 below the City’s Assessed Value for the purposes of property taxes.

  • Why would a seller not take $500,000 more? I smell FRAUD here. I would file a civil law suit.


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