Why does Oak Bluffs still own the ‘doughnut hole’?

Town, Land Bank can’t close out 2004 deal.

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In 2004, the town of Oak Bluffs and the Martha’s Vineyard Land Bank struck a landmark deal to swap two 24-acre parcels in the Southern Woodlands, with Oak Bluffs proposing to trade a landlocked parcel known as the “doughnut hole” to add to the Land Bank’s large swath of conservation land surrounding it. In exchange, Oak Bluffs would gain an accessible parcel on which to develop affordable housing. Seventeen years and numerous agreements later, that deal hasn’t happened, and affordable housing advocates and town officials are wondering, Why not?

The newly-carved-out parcel for the town of Oak Bluffs would connect to an eight-acre town-owned property next to the YMCA and the Martha’s Vineyard Ice Arena with frontage on Edgartown–Vineyard Haven Road that could be developed into affordable housing.

The Land Bank would absorb the “doughnut hole” (named for its lack of access from any public roads), giving the organization more than 100 acres of contiguous conservation.

The doughnut hole’s creation arose from a 2005 deal between the Land Bank, the Martha’s Vineyard Commission, and golf enthusiast and pharmacy entrepreneur Corey Kupersmith. Per that deal, Kupersmith, who at the time was trying to construct an 18-hole golf course, agreed to sell 190 acres of the Southern Woodlands to the Land Bank for $18.6 million. That agreement included the Oak Bluffs and Land Bank swap provision.

On Oct. 26, 2004, Roger Wey, then chairman of the Oak Bluffs selectmen, and Edith Potter, then chairman of the Land Bank Commission, signed the intermunicipal agreement to complete the land swap.

That led to the Land Bank’s 2005 purchase of Kupersmith’s property. The new property completely surrounded the 24-acre parcel owned by Oak Bluffs. One of the major issues the town faced for the land swap was to obtain clear title to the property. Conflicting claims on the land date back to deeds recorded in 1795, when the land was part of Edgartown, according to a Times article in 2012.

But those title issues were resolved in August 2018, when Oak Bluffs settled several issues with the area to move the swap along. Selectmen worked with town counsel and a title insurance company to gain clear title to the land.

To further clean up the deal, selectmen unanimously approved a $554,000 fee waiver for the Land Bank. There was $132,000 owed in back taxes on the Land Bank parcel at the time of the transfer. The Land Bank indicated it would have paid the taxes, but was not aware if they were owed because of a municipal lien certificate issued at the time. After 15 years, an additional $422,000 in interest and penalties fees had accrued.

With the doughnut hole swap approved and fees waived, the last hurdle to clear is getting approval for the swap from the state legislature; both the Land Bank and the town believe it will be approved without issue.

Another land issue stands in the way

Before that swap happens, the Land Bank wants a separate land issue addressed, which has left the deal at a standstill.

In January 2001, the Land Bank purchased a 15-acre parcel and a 22-acre parcel along County Road, both next to the Southern Woodlands property, for $250,000. The parcels were originally deeded to the town as open space in 2000, but the person who deeded the land did not actually have a title to it. When the town discovered this, officials asked the Land Bank to purchase the property from the actual title holders, William and Ann Brine. Despite their purchase, the Land Bank was never listed as the owner on the town assessor’s map.

At the August 2018 selectmen’s meeting that saw approval of the doughnut hole swap and fee waiver, selectmen also unanimously approved to list the property ownership of the County Road parcels as the Land Bank’s.

Three years later, the town is still listed as the owner of both County Road parcels.

Speaking to The Times by phone, Land Bank executive director James Lengyel said there is no “substantive debate” about the County Road parcels, and the matter is an “administrative oversight.”

The Land Bank then conditioned that it would only complete the doughnut hole swap once the town corrected the ownership of the County Road parcels.

In a February 2019 letter to Lengyel, town administrator Robert Whritenour requested the Land Bank withdraw the County Road condition, since it was never part of the 2004 doughnut hole agreement. “I respectfully point out that our initial agreement provides no such condition, and the town requests that we move forward based on the terms of the original agreement,” Whritneour wrote.

Despite the selectmen’s approval designating the Land Bank as the owner of the County Road parcels, the town held off on requesting that the assessor make the change, due to an agreement between the Land Bank and the Oak Bluffs Water District regarding a public water supply at a small parcel on County Road sandwiched between the two larger County Road parcels. 

The town now wants to complete the doughnut hole swap, and address the County Road parcels as a separate issue.

Lengyel responded in an April 2019 letter, doubling down on the County Road condition. “While the commission recognizes the importance of the ‘doughnut hole’ swap to the town, it also believes that it is prudent to tie up loose ends at one time; loose ends tend to stay loose unless resolved,” Lengyel wrote. “We understood the selectmen to share this perspective, as expressed in your August 30, 2018, letter.”

The 2019 letters were the last communication between the Land Bank and the town concerning the doughnut hole swap.

In an email to The Times this month, Whritenour said the County Road condition was thrown in “very late in the process.”

“We did reach out, but my understanding is that Mr. Lengyel was not comfortable meeting with the selectmen to review this topic,” Whritenour wrote in part. “In the meantime, there does not appear to be a reason not to move forward with the doughnut hole transfer. This should be completed consistent with the agreement, and any County Road questions resolved independently.”

Speaking to The Times by phone, Lengyel said the doughnut hole and the County Road parcels could all be completed in one move.

“Why not just do both?” Lengyel said. “It would allow the Land Bank to put the entire Southern Woodlands Reservation issue to bed. All finished, all done.”

When asked why the Land Bank won’t send the doughnut hole to the state legislature and deal with the County Road parcels separately, Lengyel said that instead the deal can put all in one.

“The Land Bank said, ‘Why don’t we just wrap it up in one package and just finish with the whole thing, and know that everything is behind us once and for all?’” Lengyel told The Times on a phone call. 

Town officials, such as selectman Brian Packish, see the issue differently, and particularly as a detriment to affordable housing. 

Speaking to The Times by phone, Packish said the Land Bank has the ability to execute the doughnut hole swap, securing land for the town that will most likely be used to build affordable housing, planning for which is already underway. “And yet they choose not to do it,” he said.

Packish said the Land Bank is in a “financial boom” due to the record $1 billion in real estate sales in 2020, of which the Land Bank received nearly $20,000,000 through its 2 percent transfer fee on real estate transactions.

“My question to the Land Bank is: You have more money than ever, we’ve given you what you wanted in regards to the transaction, we’re here ready and waiting, the public is screaming for more opportunities for more housing,” Packish said. “The only thing standing in the way of us helping the people achieve housing is the Land Bank. Why?”

Packish said the selectmen are working with Whritenour to address the issue with the Land Bank.

Planning board chairman and Oak Bluffs Land Bank advisory board member Ewell Hopkins said the doughnut hole swap is not a burden on the Land Bank, since all of the land is currently undeveloped and in a conserved state.

“I am not convinced, and I have seen no evidence over the last eight years, that the Land Bank is interested in getting this deal done,” Hopkins said. “And it’s very, very frustrating.”

The significance of the swap is profound, and needed to be solved “yesterday,” Hopkins said, due to the area’s transportation services, close proximity to Island services, and potential for smart growth and environmental development.

“They’re holding us hostage, saying that all of these different things that are beyond the original agreement must be addressed before they’re prepared to consummate the deal which has all been marked out and agreed to,” Hopkins said. “It’s tiresome now; they need to just get it done.”

Oak Bluffs Land Bank representative Kristen Reimann said she spoke with Lengyel about the doughnut hole swap at the end of last year, and he asked her to help facilitate the deal. 

Lengyel told The Times “the timing is good” for the Land Bank to reach out to the town. “I’m glad the town wants to move things forward,” he said.

Reimann is working to bring both parties together. “I think that there needs to be a face-to-face, with me as the buffer,” Reimann said.

As an advisory board member, Hopkins said, there has been plenty of opportunity for the Land Bank to address the doughnut hole swap, but it hasn’t happened.

The issue is also frustrating from a planning perspective, Hopkins said. The town spent $100,000 to conduct a feasibility study for affordable housing at the eight-acre site it owns. Hopkins said if the doughnut hole swap was completed and added 24 acres, that money could have covered the cost for a larger feasibility study.

“I’m not saying it’s going to cost us another $100,000, but there’s going to be an incremental cost for us now to go back and modify that work to incorporate, formally, the remaining 24 acres,” Hopkins said. “This delay is costing the town in real dollars.”

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