Friday, November 12, 2010
Rocky Point developer suspended from further 40Bs
The developer of Rocky Point in Carlisle has been suspended from further participation in Chapter 40B development. In April 9 letter, Gina B. Dailey of the Massachusetts Housing Finance Agency informed Michael Kenny of MKCKMK, LLC, that the suspension is “due to your continued failure to complete your cost examination.”
On November 10, Eric Gedstad, Manager of Communications for MassHousing confirmed that “Mr. Kenny has not yet submitted his cost certification to us, and therefore the suspension we put in place on April 9 is still in effect. However, we have met with Mr. Kenny and some of his associates and we have been aggressively pursuing them to submit the required report.”
Under Massachusetts law, any profits in excess of 20% on a 40B development revert to the town to be used for additional affordable housing. An independent audit is required to confirm profitability. The state first asked for the statement from Kenny in a letter dated December 19, 2006, at which time the development was complete.
The developer was not reached this week, but in a telephone conversation in January 2009, Kenny said he believed “These audits are totally voluntary” and added that the requirement for an audit “was not part of my permit.” He noted then that he was “working on it,” adding, “I can’t believe what a total pain this is. Legitimate business people get skewered.”
In April of 2008 a new regulation went into effect that required 40B developers to post a bond that would not be returned until the profitability statement was completed. Before that time, there was no easy recourse for a town if a developer refused to submit the statement. ∆
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