New division leads to savings, revenue

Mass Innovations, From The Beacon, December 2011

In 2009, Lowell officials were confronting a serious problem: The state Inspector General’s Office was investigating alleged criminal activity by members of the city’s Inspectional Services Department involving building projects that were completed without permits.

Rather than simply removing the employees who were found responsible, city leaders opted to create a new entity, the Division of Development Services, which would offer a more comprehensive range of services.

The new entity, approved by the Lowell City Council in October 2010, did more than just restore integrity to a key function of municipal government. By the time the Division of Development Services had been in place for a full year, city officials calculated that the reorganization had led to savings and revenue increases totaling roughly $1 million.

“The idea was to respond to the problems with a reorganization that would result in a much better customer service approach, much better coordination, much better messaging to folks who were proposing economic development in the city,” according to Adam Baacke, head of the city’s Department of Planning and Development. “What we didn’t really expect is that there would be significant budget benefits.”

The restructuring brought under one roof several development-related functions that previously were scattered among separate neighborhoods.
“If you were the proponent of a significant project, you literally had to drive miles around the city to obtain all the permits you needed,” Baacke said.

Centralizing these services enabled Development Services to reduce operating costs by almost $300,000. Money generated through the permitting process increased by roughly $80,000, due in large part to increased enforcement of permit requirements.

The reorganization also helped Lowell collect more than $70,000 in previously unpaid fines.

The largest portion of new revenue, however, has come through enforcement of an ordinance designed to compel banks to take responsibility for maintaining foreclosed properties and preventing blight.

The ordinance, which requires banks to register the properties or pay a fine, was already on the books when Kendra Amaral was appointed to lead the Division of Development Services in 2010. But the law had been sporadically enforced, and had generated only about $45,000 in revenue.

“One of the things I started to work on early on was to reach out to the major banks – Bank of America was our first target – and pushing them to understand that failure to comply was going to result in significant liens against these properties, as well as potential takeovers of property through receivership,” Amaral said.

By early April, Bank of America had paid fines of almost $400,000, according to Amaral.

For more information, contact Adam Baacke at (978) 674-4252.