I-Team: After Money Allegations, MassDOT Withheld Taxpayer Subsidy From Greenway

BOSTON (CBS) -- After allegations of financial misconduct surfaced, state transportation leaders withheld a monthly $165,633 taxpayer subsidy to the Greenway Conservancy, according to emails the WBZ I-Team obtained.

The emails, received from a public records request, also reveal discussion about how to wean the nonprofit that oversees the stretch of downtown park space off the public's dime.

The Massachusetts Department of Transportation (MassDOT) is providing about $2 million this year to the Greenway Conservancy, which can only be used for maintenance and horticulture.

However, an anonymous whistleblowers' report accused the nonprofit leadership of using taxpayer funds to cover art project cost overruns and staff salary increases.

Read: I-Team: Internal Investigation Clears Greenway Conservancy Of Improper Financial Conduct

The report took aim at last summer's floating sculpture, which was originally budgeted for $500,000, but finished with a $1.8 million price tag. (Editor's note: WBZ-TV was a media sponsor of the art installation).

The same day several media outlets reported the art project's cost, MassDOT leaders decided not to send a July payment.

"The accounts payable voucher for the Greenway July monthly payment was processed, but has not yet been remitted. Will hold per our discussion this morning," Mark Boyle, assistant general manager of real estate and asset development, wrote to Secretary Stephanie Pollack.

More than a month later, it was only after the Greenway Conservancy released findings of its internal investigation that MassDOT released the subsidy payment. The internal probe, first reported by WBZ, concluded there was no evidence of "improper conduct."

"MassDOT takes the allegations made in the report seriously," said spokeswoman Jacquelyn Goddard. "This information will be considered for future leases."

The current subsidy agreement between the stage agency and the nonprofit ends next summer. An internal presentation the WBZ I-Team obtained shows state leaders are trying to identify ways to decrease its taxpayer-funded payments.

The document, contained in the email records request, stated a goal of "extricating MassDOT from position as sole backstop to Greenway financial needs."

One of the main ideas is having surrounding property owners shoulder the financial amount, either through voluntary contributions or a special assessment district. Another concept would be pursuing a $500,000 annual amount from the City of Boston, which current provides no cash or in-kind support.

However, the internal presentation acknowledged the state agency's problematic negotiating position.

"MassDOT owns the park and will be stuck with a deteriorating park if the $2 million in funding is not replaced," the report said.

The WBZ I-Team recently asked the Greenway Conservancy's chief of staff, Michael Nichols, if the nonprofit could operate without the MassDOT subsidy.

"I don't think so and certainly not at this time," Nichols said. "At the end of the day, the decision was made to construct a high-end park in the urban core to sit on top of the state's investment in an underground tunnel."

Ryan Kath can be reached at rkath@cbs.com. You can follow him on Twitter or connect on Facebook.