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April 24th, 2015

4/24/2015

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I want to talk about the privatization of the USPS----our Post Office, happening faster than ever under Obama and Clinton neo-liberals in Congress.  This was a decades process from Reagan Clinton to Bush Obama but the outsourcing has soared during Obama's terms.  Remember, neo-liberals privatize all that is public and the Post Office is the largest public institution outside of our public schools.  As important is the USPS is the only method of communication for the American people that can be price-controlled to allow all Americans at least one method of communication as telecommunications corporations raise rates higher and higher most people will not be able to access the internet or cell phones.  Right now the poor are being given free phones but that will end once consolidation of the media market and Post Office privatization cripples mail service.  The Post Office is a Constitutionally established and protected agency that operates without taxpayer money.  So, privatizers cannot get rid of it without a Constitutional Amendment so they are simply defunding and dismantling it until it cannot function and becomes useless.  As you see it is the President that appoints the Post Master General and Obama's appointment Donahue is privatizing as hard as he can.  Think about this dismantling at the same time net neutrality is under attack and internet rates rise as does cell phone rates.  How will people communicate if the Post Office mail is gone as well?  That's what a third world nation looks like says Clinton neo-liberals!


The Constitution and the Post Office In June 1788, the ninth state ratified the Constitution, which gave Congress the power “To establish Post Offices and post Roads” in Article I, Section 8. A year later, the Act of September 22, 1789 (1 Stat. 70), continued the Post Office and made the Postmaster General subject to the direction of the President. Four days later, President Washington appointed Samuel Osgood as the first Postmaster General under the Constitution. A population of almost four million was served by 75 Post Offices and about 2,400 miles of post roads.

The Post Office received two one-year extensions by the Acts of August 4, 1790 (1 Stat. 178), and March 3, 1791 (1 Stat. 218). The Act of February 20, 1792 (1 Stat. 232), continued the Post Office for another two years and formally admitted newspapers to the mails, gave Congress the power to establish post routes, and prohibited postal officials from opening letters. Later legislation enlarged the duties of the Post Office, strengthened and unified its organization, and provided rules for its development. The Act of May 8, 1794 (1 Stat. 354), continued the Post Office indefinitely.

The Post Office moved from Philadelphia in 1800 when Washington, D.C., became the seat of government. Two horse-drawn wagons carried all postal records, furniture, and supplies.



________________________________________________
You will hear Congressional Democrats blame the Republicans for defunding and privatizing the Post Office but if you look where this 'pilot Staples' outsourcing is being run -----states like Maryland are right there placing the USPS into Staples under the guise of a pilot.  At the same time Governor O'Malley took control of Federal Post Office buildings as in Annapolis with the intention of selling them.  Meanwhile, the new Post Office is a store front.  I see Staples with USPS all over Baltimore County so, your pols are not fighting privatization as they install this pilot that will be declared a success with a private business taking over Post Office operations.  We already see USPS kiosks in pharmacies or grocery stores as a step towards this privatization.  What will happen if allowed to move forward----corporations will declare house to house delivery too expensive---then they will declare the USPS package delivery a duplicate of existing private package delivery and stop that----and the letter delivery will become too costly and be eliminated. 

BYE BYE POST OFFICE SAY MARYLAND'S CLINTON NEO-LIBERALS AND BUSH NEO-CONS!


Remember, the USPS is not a taxpayer supported agency---it supports itself.  Privatizers are claiming costs are too high for the Post Office but the deficit is a pre-paying of public pensions of hundreds of billions of dollars done just to gut Post Office profits.  No other corporation has to pre-pay pensions to the extent this rule does to the USPS making it impossible for USPS to compete.


So, a Clinton neo-liberal Obama appoints a privatization Post Office General while neo-liberals in states like Maryland allow for outsourcing pilots like Staples to take the business.


Staples’ selling postal products without USPS workers brings complaints of privatization

By Joe Davidson Columnist January 16, 2014  Washington Post

The largest postal employee union and a U.S. senator say the pilot also is a step toward privatization of the USPS, an assertion the postmaster general vehemently denies.

Here’s the story:

The Staples pilot project, called the Retail Partner Expansion Program, began in October. Eighty-two stores nationwide, though none in the D.C. area, have sections resembling mini-post offices. They sell a variety of products and services, including stamps, Priority Mail, Priority Mail Express and package handling. Staples doesn’t offer registered mail, money orders, stamped envelopes or post office boxes.

“Our goal,” Postmaster General Patrick Donahoe said in an interview, “is to provide universal access to products and services, and if we can do that through agreements with companies like Staples . . . we need to do that. . . . It gives us an opportunity to grow the business.”

That’s cool, as far as the American Postal Workers Union is concerned, but why not have postal employees work those counters in Staples? “I can’t dictate to Staples what their hiring policies should be,” said Donahoe, who is chief executive of the Postal Service.

But can’t USPS say it wants a postal employee to sell postal products at a postal counter in Staples? “It would never be my intention to do that,” he said. “That’s their business. . . . That’s their call.”

It’s the wrong call, APWU President Mark Dimondstein said.

“This is a direct assault on our jobs and on public postal services,” he said in a statement. “The APWU supports the expansion of postal services. But we are adamantly opposed to USPS plans to replace good-paying union jobs with non-union low-wage jobs held by workers who have no accountability for the safety and security of the mail.”

Carrie McElwee, a Staples spokeswoman, would not discuss the pay or union status of the company’s workforce.

Dimondstein also fears that the Staples experiment foreshadows a privatization of the U.S. Postal Service. He is concerned about maintaining “the infrastructure of the Postal Service that belongs to the people of this country.”

The APWU is willing to go along with the Staples project if it uses postal employees, “but we also have to be very careful that the private companies don’t become the Postal Service, because those private companies can be here today and [not] be here tomorrow,” Dimondstein said by phone. “We don’t want private companies making decisions about what’s best for the public good and the public service when their bottom line is simply profit.”

Donahoe said the Staples project is good for the public and for postal employees, too.

“My goal is to grow the business,” he said. “If we grow the business, that benefits 490,000 career employees and another 100,000-plus non-career. It’s good for everybody.”

The number of postal workers has fallen by about 44 percent since 2000, Donahoe said. The Bureau of Labor Statistics has projected these declines in the postal workforce between 2012 and 2022: postal mail sorters, processors and processing-machine operators, 30 percent; mail carriers, 27 percent; and mail superintendents, 24 percent. Postal finances are improving, but the Postal Service lost $5 billion in fiscal 2013.

Donahoe said privatization “would be a crazy idea. I think the Postal Service as structured is a great service provider. . . . Why would we ever put anything like that at risk?”

Sen. Jon Tester (D-Mont.), chairman of the federal workforce subcommittee, doesn’t think USPS provides great service, and he also warns against privatization. Tester said he doesn’t object to postal products being sold in stores, but he was critical of Donahoe for seeking to shut postal facilities, which Tester said would delay deliveries.

Delivery standards are a personal issue with Tester, an issue he wants addressed in postal reform legislation that has bounced around Capitol Hill for years.

_________________________________________

The US always leads in rising consumer costs but you do not see the headlines as you do around the world----all the costs of communications are soaring as mergers create global telecommunications.  At the same time the UK, Canada, as with the US are seeing their Federal Post Office services dismantled and privatized. 

What will Americans do that cannot afford these online fees as over 70% of Americans are at or near poverty and the coming economic crash will push that number to over 80%?


JUST GET RID OF THE CLINTON NEO-LIBERALS----YOUR LOCAL POLS ARE SETTING THE STAGE FOR THESE MONOPOLIES AND DEREGULATION CREATING THIS MESS!


Call costs and landline rentals soar as telecoms... www.dailymail.co.uk/money/bills/article-2820975Call costs and landline rentals soar as telecoms giants raise prices. By Daily Mail Reporter. Published: ... How to unlock a cheaper deal for your mobile phone ...
  1. Phone, Internet Costs Soar In Canada, StatsCan... www.huffingtonpost.ca/2014/09/22/phone-internet-costs...CachedPhone, Internet Costs Soar In Canada, ... Wind Mobile Wireless Prices Canada Statscan Inflation Statscan Telecom Prices Canada Statscan Price Index Verizon Canada ...



Our Post Offices Are Not For Sale!

Tuesday, December 4th The Save Our Post Office Coalition of SF, Save the Berkeley Post Office Committee, Berkeley-East Bay Gray Panthers, SF Gray Panthers, The Living New Deal, Grandmothers Against War, joined retired and current postal workers to tell Richard Blum, CBRE, Inc.” Stop selling our post offices.” Occupy SF & Occupy Oakland camped out over night in front of his SF financial district office, 909 Montgomery, with tables of information on CBRE and Blum. We then marched through the financial district to Senator Feinstein’s office. After a rally outside, a delegation led by Margot Smith of Berkeley-East Bay G, met with Senator Feinstein calling on her to do the right thing and save our post offices. Feinstein happens to be the spouse of Richard Blum. As Richard Koritz of North Carolina State Assoc. of Letter Carriers said at the rally- what an example of a marriage between political and corporate corruption.

The rally was to stop the sales of post offices across the country, and this rally emphasized the pending sale of the Berkeley Main Post Office. Built in 1914, its tall ceilings marble, oak and bronze fittings house two incredible murals. Linda Maio, Vice President of the Berkeley City Council, told the rally that the council has joined the fight to save the post office by passing a resolution to stop the sale of the Berkeley P.O.

Many of our post offices, built during the New Deal, depict our historic labor struggles in murals that are our public art. How ludicrous that these public houses of the peoples’ art should privatized and sold to the highest bidders. When Gray Brechin of the Living New Deal project tried to visit the Philadelphia post office, a guard blocked his entry then told him if her attempted to photograph the beautiful Deco lobby his camera would be confiscated. A woman who tried to photograph artwork at the Catonsville, MD post office was told not only that she could not take a picture inside, but she could not even take a picture of the exterior. Even trying to take pictures to preserve and record our public art works seems to be a threat. Symbolically, this represents attempts to wipe out our history.

A union member of the American Postal Workers Union told us the union leadership has not pushed against these sales. The director of the United Parcel Service, Gary MacDougal, stated in the Wall Street Journal this fall. “Entrepreneurs will see the demise of the USPS as an opportunity...this transition can be one of the badly needed bright spots in a troubled American economy.” Postmaster General Donahoe led the charge to end six-day delivery; close 4,000 post offices eliminate 250 processing plants and 200,000 decent union jobs.
This is another attack on public workers and good paying union jobs, so call the national office, 202-842-4200, and tell leadership to mobilize members to protect jobs and stop the privatization of our post offices!
Since 1971, post offices have not received any tax dollars. Compare that to the bank bailouts-our tax dollars.


For previous indybay coverage and background on our Post Office crisis





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Who does corporate fraud and government corruption better than Maryland these days?  California.  Imagine O'Malley in Maryland taking Federal Post Offices in Maryland from the Federal government with the intention of selling them.  Look below to see what is likely to happen.  These Post Office buildings are classic.  They were constructed during the New Deal years and are valuable public property.  What we are seeing as with all public real estate and assets----they are being handed off in pay-to-play style deals for pennies on the dollar.  This is what is happening in Baltimore and we can be sure our Post Office buildings on the road to being closed and sold in Maryland will look like this article below.

Feinstein was a strong progressive woman leader in the 1970s during the civil and women's rights movement.  Just as with civil rights leaders, our women's rights leaders are now simply acting as crooks and frauds-----Who does fraud and corruption best?  Clinton neo-liberals.  Who makes sure public protections and public justice are in place to keep this from happening?  PROGRESSIVE LIBERAL DEMOCRATS!  A DEMOCRAT WOULD NOT ALLOW THIS TO HAPPEN FOLKS!

Whether it is our public school buildings mortgaged under credit bond debt or the handing of vintage Post Office buildings that reflect our strong public space in Democracy----

A VISIGOTH LOOTING OF THE US TREASURY AND PUBLIC ASSETS IS THE SAME AS THE RUSSIAN PERESTROIKA THAT GAVE RUSSIAN OLIGARCHS ----THE FEW FAMILIES THAT TOOK ALL OF THE PUBLIC WEALTH FROM THE RUSSIAN PEOPLE. THIS IS THE SAME THING FOLKS----AMERICAN STYLE.


The article below is long but please glance through.  It will show the same level of fraud and corruption we see in Maryland and how pols are doing it.  Remember, when a government suspends Rule of Law----it suspends Statutes of Limitation.  Keep in mind Donahue is an Obama appointee and this is happening under Obama and with Clinton neo-liberal pols so this is not a Republican privatization issue-----Clinton neo-liberals are joining the Republicans.

Privatization Nightmare: Sen. Dianne Feinstein's Husband Selling Post Offices to His Friends, Cheap An investigative journalist conducts a year-long study of power, corruption, and public assets for sale.



By Peter Byrne / Byrne Ink October 30, 2013
Print 68 COMMENTS Editor's note: The following is an excerpt from the new book, Going Postal, in which investigative journalist Peter Byrne reveals the results of a year-long study into a privatization scheme that has enriched the powerful and robbed ordinary Americans.

Going Postal: Introduction

On July 27, 200 singing and chanting people demonstrated on the steps of the historic main post office in downtown Berkeley, Calif., to protest its upcoming closure and sale. A city council member took the microphone to angrily decry the closure. In fact, the Berkeley City Council had voted unanimously to oppose the sale. Why the day of rage?

When a post office closes, it is obviously that much harder to buy a stamp, pick up a package, send a registered letter, or purchase a money order. But inconvenience alone did not account for the existential angst being expressed by the mostly over-50 throng as it questioned the motives of the United States Postal Service for selling post offices all over the country to developers. "Which of our public assets will be privatized next?" speakers asked. "Streets? Schools? The Lincoln Bedroom?"

The Berkeley crowd is not acting alone: From the beaches of Santa Monica to the avenues of the Bronx to the orange farms of Nalcrest, Florida, people who like the U.S. mail are getting mad, "Hey, wait a minute, Mr. Postman! That is our community post office!"


To which the federal flak-catchers reply: "The Internet is killing us. The Postal Service is broke. We have to sell. Get used to it."

But email is not the problem and the budget deficit is easy enough to fix, so there must be other reasons for the forced sales, say save-the-post-office activists. Political reasons, they assert, pointing out that the realtor with the exclusive contract to negotiate sales for the Postal Service's $85 billion real estate portfolio is C.B. Richard Ellis (CBRE). And that the corporation is chaired by Richard C. Blum, who is the husband of U.S. Sen. Dianne Feinstein of California. The corporation's connection to a politically powerful family with a history of accessing public pension funds to make private investments has caused more than a few activists to suspect wrongdoing—even though no evidence of any conflicts of interest tied to the CBRE contract has been revealed.

Until now.

This year-long investigation has uncovered evidence of multiple conflicts of interest and problems with post office sales supervised by Blum's company:

  • CBRE appears to have repeatedly violated its contractual duty to sell postal properties at or above fair market values.
  • CBRE has sold valuable postal properties to developers at prices that appear to have been steeply discounted from fair market values, resulting in the loss of tens of millions of dollars in public revenue. In a series of apparently non-arm's length transactions, CBRE negotiated the sale of postal properties all around the country to its own clients and business partners, including to one of its corporate owners, Goldman Sachs Group.
  • CBRE has been paid commissions as high as 6 percent by the Postal Service for representing both the seller and the buyer in many of the negotiations, thereby raising serious questions as to whether CBRE was doing its best to obtain the highest price possible for the Postal Service.
  • Senator Feinstein has lobbied the Postmaster General on behalf of a redevelopment project in which her husband’s company was involved.
Backstory

Because the Postal Service is running an artificially created budget deficit, tens of thousands of jobs are being liquidated as post offices and mail processing facilities in towns and cities across the country are short-listed to be sold for ready cash. CBRE has already sold 52 of these properties, and hundreds more are on the chopping block.

Eighty percent of the agency's multi-billion-dollar deficit is caused by a law passed by Congress in 2006 that requires it to prepay retiree health benefits 75 years into the future. This unprecedented, budget-killing command does not apply to any other government agency. If this burden was to be rescinded—and business-mail was to be charged the cost of its delivery—the Postal Service would be in the black, according to congressional reports.

The ugly truth of the matter, say informed critics such as New York University professor Steve Hutkins, is that the Postal Service is being privatized in the interests of scores of corporations that not only compete with it, but are also its largest contractors, including FedEx and United Parcel Service (package routing); Parsons Corporation (management services); Accenture (financial consulting); and Pitney Bowes (direct mail).

Then there is CBRE, the world's largest commercial real estate firm. In June 2013, Postal Service Inspector General David C. Williams published a scathing audit of CBRE's exclusive contract to manage all of the sales and leasing of postal real estate. Williams noted that outsourcing these activities to a single firm is "a fundamental change from how the Postal Service previously managed its real estate portfolio [and] Facilities officials should improve oversight to mitigate inherent risks associated with the CBRE contract … Specifically, there are conflict of interest concerns."

Williams warned of the potential for contract fraud, but he stopped short of referring the matter to a district attorney, and advised the postal executives in charge of the CBRE contract to clean up their act. Over the past year, this investigation explored the types of conflicts of interest that concerned Williams by diving deep into the public record. CBRE's contract, its postal facility sales data, as well as expense reports for Postal Service executives were obtained under the Freedom of Information Act (FOIA).

The deeds of sale and assessment data for most of the postal properties sold by CBRE were found at the county level. The county records allow for comparing the assessed value of the postal properties before they were sold to the final sales prices negotiated by CBRE on behalf of the Postal Service. The comparisons reveal that CBRE has sold the bulk of this public real estate at prices under their assessed values—and apparently at far below fair market values.

When these findings were shared with Chuck Zlatkin, legislative and political director of the New York Metro Area Postal Union, he said, "Shocking as this information is, it is not surprising because we have seen a pattern of corruption at the Post Office ever since the manufacture of the healthcare benefit prepayment crisis. It is certainly not permissible for CBRE to sell property paid for by the public to its own business partners, or to anyone else, at a discount. In my opinion, CBRE's conflicts of interest contain an element of fraud."

CBRE Group Inc. was given a list of the key facts and analysis reported in this investigation. Through its spokesperson, Philip Russo, the corporation declined to comment.

Conflicts of interest

In June 2011, the Postal Service hired CBRE as its exclusive agent to sell post offices, warehouses, parking lots and vacant land worth hundreds of millions of dollars. The contract instructs CBRE to propose properties to sell with final approval reserved to the head of the Postal Service's Facilities Division, Tom Samra. It requires CBRE to sell them at or above appraised (fair market) values, or not at all. CBRE is charged with appraising the fair market value of these properties and listing a reasonable sales price. It is important to point out that real estate appraisals are not customarily performed by the realtor who is marketing the property. To avoid conflicts of interest, property appraisals are normally performed by professionals who are not involved in negotiating the sale.

Responding to a FOIA request through a staff attorney, Postmaster Patrick Donahoe categorically refused to disclose CBRE's appraisals. Attorney Jeff Meadows said that CBRE's appraisals do not need to be disclosed to the public because such information is "commercially sensitive" and it is comparable to a "national security" secret (even though the appraisals are not classified). The Postal Service eventually released the final sales price for each property sold by CBRE, and CBRE's sales invoices, which recorded the amount of its commissions (2-6 percent). The appraisal figures remain a state secret.

An assessed value is normally based upon the most previous sales price of a parcel, which is most likely to be less than its current fair market value. In many counties, the assessed value is calculated as a percentage of the fair market value. During economic downturns, assessed values in most counties are lowered to keep pace with a falling market.

During the first two years of its contract, CBRE undersold the majority of the 52 properties it had picked to market by millions of dollars under their assessed values. In Seattle, Washington, CBRE sold a building assessed at $16 million for $8 million. In mid-2013, it sold a 17-story office building in St. Paul, Minnesota for $20 million under the value assessed for it in 2009, shortly before it was put on the market by CBRE at $5 million.


From June 2011 through May 2013, CBRE sold 52 postal properties for $166 million. The total assessed value of this portfolio at the time of sale was $232 million. Subtracting out the nine properties that sold at a value higher than their assessed value, CBRE has arguably undersold its postal real estate portfolio by at least $79 million. It undersold these properties even as the price of commercial real estate, especially for central downtown parcels, was approaching the pre-crash highs of 2007, as evidenced by Figure 1.

Click to enlarge.Interviews about standard real estate practice with experts provided by the National Association of Realtors indicate that selling properties at or below assessed values can occur because the property is distressed or located in an impoverished area, or logically, because the realtor wants to move a portfolio of listings quickly. Since time is money, the realtor is willing to lowball multiple deals that generate fast commissions, instead of taking the time and expense of showing each property to many prospective buyers.

But the vast majority of the CBRE-negotiated sales did not involve distressed properties. The sales were mostly of central downtown buildings with parking in wealthy or revitalizing neighborhoods that attracted restaurant, boutique, and residential developers; and modern, suburban office buildings and warehouses with ample parking that attracted high-tech industrial firms.

In other words, the most saleable postal properties were the ones most likely to command prices that exceeded their assessed values. And yet 43 of CBRE's 52 sales came in at prices far below their assessed values. Figure 2 shows the gap between assessed value and the CBRE sale price for properties over $5 million. Figure 3 reveals a similar discrepancy for properties sold for under $5 million.

Click to enlarge.ADVERTISEMENTClick to enlarge.Not at arm's length

Real estate transactions are normally negotiated by agents who stay at "arm's-length" from each other's interests. That makes sense because sellers try to obtain the highest price possible, while buyers angle for the lowest price. Each agent is bound to get the best possible price for its client in a competitive marketplace.

In a series of non-arm’s-length transactions, CBRE has sold 20 percent of its postal portfolio to its own clients and/or business partners. In Boston, it sold a parcel to a developer with whom it was partnered at a large discount to its assessed value. And it sold another Boston parcel to one of its largest shareholders, Goldman Sachs Group. Real estate industry ethics require agents to get the best deal for their clients, not for their business partners and owners.

CBRE kept the entire seller/buyer commission of up to 6 percent paid by the Postal Service in 34 of 52 transactions. In the majority of these deals, CBRE appears to have represented the interests of the buyer as well as those of the seller, even though CBRE was originally contracted to represent only the interests of the Postal Service.

Astonishingly, CBRE's contract was amended in 2012, at the request of CBRE, to allow it to negotiate on behalf of both the Postal Service and prospective buyers.

No oversight

To be fair, CBRE need not shoulder all of the blame for the $79 million in lost revenue.

In his June 2013 audit, the inspector general reported that executives running the Postal Service Facilities Division were not properly monitoring the CBRE contract. He found that:

  • The dollar amount of the contract is improperly open-ended and poses a risk of runaway costs. The original $2 million budget has unaccountably tripled.
  • Facilities Division officials improperly paid CBRE invoices without checking for fraud. At least 227 invoices worth $1.7 million were paid without proper oversight—"present[ing] an increased risk of fraud [and] pos[ing] an increased risk to the Postal Service's finances, brand, and reputation."
In short, the normal checks and balances mechanisms for preventing conflicts of interest and contract fraud have been missing in the monitoring of CBRE's performance by Facilities Division officials. Given the ethical norms at play on the top floors of the Postal Service's headquarters at L'Enfant Plaza in Washington D.C., this is not surprising. The inspector general has also reported that high-ranking Postal Service executives have charged home mortgages and European vacations to their government credit cards.

And Facilities Division expense reports reveal that staffers have purchased hundreds of thousands of dollars worth of expensive dinners, online gift cards, inspirational literature, and even toys with their government-issued credit cards. The division's chief, Tom Samra, has billed the deficit-ridden Postal Service for flying first class to Europe, even though he personally is worth as much as $98 million.

The Postal Service was given a list of the key facts and analysis reported in this investigation. Through his spokesperson, David Partenheimer, Postmaster General Patrick Donahoe declined to comment.

The Boston Seaport Deals

In Boston, during 2012, while acting as the Postal Service's agent, CBRE sold discounted real estate to a group of developers with which it was partnered in a redevelopment project. CBRE sold a valuable parcel in the same development project to one of its largest stockholders, Goldman Sachs Group. These and a host of similar transactions around the country raise questions as to whether CBRE improperly benefited from selling postal properties to its clients and business partners.

CBRE is a major player in the development of a new neighborhood in downtown Boston called the Seaport District. The mixed-use district is slated to revitalize 1,000 acres of abandoned railways and crumbly docks that surround the Boston Convention Center. The linchpin of the giant redevelopment project's design is the upscale Channel Center, which will sport expensive residences, office buildings, and grassy parks. A portion of the project is sited on Postal Service land that has been sold by CBRE to the developers.

The parking garage

According to the Channel Center developer, Commonwealth Ventures LLC, CBRE is the member of its development "team" that provides real estate services to the project. Commonwealth Ventures is also partnered with AREA Property Partners, which has collaborated with CBRE on other real estate ventures. Another CBRE client, the real estate arm of General Electric Corporation, is also a member of Commonwealth Ventures' Channel Center team. In what appears to have been a conflict of interest, CBRE has acted as the broker for both the Postal Service and the Channel Center development partnership, of which it is considered to be a "team" member and which is composed of its clients.

In September 2012, AREA Property Partners paid the Postal Service $10.3 million for a parking lot where the company planned to construct the Channel Center parking garage. The Postal Service was represented by CBRE in the sale, even though CBRE is also the agent for the Channel Center developers, Commonwealth Ventures and AREA.

According to the Boston Assessor's property database, the parking lot was valued at $12.4 million in 1991. This key piece of real estate in the Channel Center project was sold by CBRE for 20 percent less than it had been valued more than two decades before the property was targeted for upscale redevelopment for corporate and residential tenants. Because CBRE is also a member of the development team, the sale raises questions as to whether the company stands to reap additional profits from the Channel Center project.

Remarkably, the invoice that CBRE submitted to the Facilities Division for the sale of the Channel Center parking lot to Commonwealth Ventures does not contain an address for the property sold, only the notation: "0 Square Feet." Under "value,” CBRE wrote, "?" Nowhere on the undated invoice does the purchase price appear. Nor does the invoice reference a contract number, nor any form of payment authorization. It demands a flat fee of $377,500 for negotiating the sale; the CBRE contract does not allow for flat fees. Nonetheless, the incomplete invoice was paid by Postal Service facilities executives.

The Goldman Sachs connection

A real estate partnership created by the Goldman Sachs Group called W2005 BWH Realty LLC purchased a parcel of Postal Service land for a residential development alongside the Channel Center in September 2011. The parcel was subdivided from a larger parcel, so it had no previously assessed value as a unit. CBRE sold the postal parcel for $1 million to the entity controlled by the Goldman Sachs Group, which itself owns 6.6 percent of CBRE: a stake that rivals Blum Capital Partner's stake of 6.9 percent. Goldman Sachs is also a long CBRE client and its co-investor in numerous ventures. Since CBRE took the entire commission of six percent, it appears to have represented both seller and buyer in a non-arm's length transaction that poses an conflict of interest.

The CBRE invoice for the sale to the Goldman Sachs partnership does not list a dollar amount for the sale, nor the name of the buyer (which was obtained from deeds on file with the Boston Assessor's office).

James Allen of the Postal Service Facilities Division said, via email, that after paying CBRE for both of the Boston Seaport deals, facilities managers requested that CBRE change the format of its invoices to include more information.

Toxic sludge is not good for you

Much of the Postal Service's land in the Seaport District has been soaking in a toxic stew of industrial chemicals for 200 years. As long ago as 2002, CBRE had prepared a site survey of the property for the Postal Service with an eye toward having it cleaned up at federal expense for sale to developers. In 2012, CBRE billed the Postal Service for creating the "Standard USPS Environmental Disposal Package" for its seaport property.

Sales have proceeded despite a dire warning issued by the Massachusetts Environmental Protection Agency that developing the polluted postal property, "may result in significant risk of harm to health [if] use[d] as a residence, school, nursery, daycare, or recreational area, and/or such use at which a child's regular presence is likely." Channel Center office dwellers need to be careful of breathing indoor air, lest it be contaminated by toxic dust, the regulators caution.





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    Cindy Walsh is a lifelong political activist and academic living in Baltimore, Maryland.

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