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State Control, Annexation? Tough Choices in Broke Chelsea, Mass.

September 10, 1991

CHELSEA, Mass. (AP) _ Chelsea rebuilt itself after a fire in 1908 and after another big blaze in 1973. But this time, it may not be able to rise from the ashes.

The city next to Boston is broke. The schools are shut, municipal workers may not get paid, and the state is considering putting Chelsea into receivership. If that doesn’t work, Boston’s mayor has offered to annex the place.

If the Legislature votes for receivership, Chelsea would become Massachusetts’ first community to be declared inoperable since the Depression.

″Maybe it’s not a bad idea to put the city in the hands of businessmen until they get it on its feet,″ said Andrew Diranian, who owns the Avenue Coffee Shop across from City Hall. ″Then the politicians can start stealing again.″

The city of 25,000 has been poor for years. But voters’ refusal to raise taxes, an influx of immigrants and the recession combined to bring it to the brink. Chelsea’s shortfall is $9.5 million this fiscal year and growing.

City Hall itself is down at the heels. Dusty displays describe a revitalization project for the main square from years gone by. The glass doors are dirty with rain spots and fingerprints.

Just steps away, the homeless and unemployed pass the time on wooden benches. Chelsea has Massachusetts’ third-largest number of families earning less than $10,000 a year and the highest percentage of people living in poverty.

Mayor John Brennan has pushed for receivership, saying: ″Why postpone the inevitable? Let’s do it now instead of doing life a day at a time.″

But no town goes down easy, and residents cling fiercely to a better past and the promise, however remote, for the future.

″This place used to be gorgeous,″ Marie Pezzuto, 61, a shoe store clerk, said with a wave of her arm at Bellingham Square, the city’s center. ″I’ve seen it change - big change, not little change.″

One change has been an influx of immigrants from Latin America and Asia. Salsa music reverberates from cars, and Spanish is spoken nearly as often as English on the street.

Some older residents blame the newcomers for the problems. But Paul Park, a Korean immigrant who owns the shoe store where Pezzuto works, said he has as much a stake in the city’s future as anyone.

″It used to be a good place, compared to now. It’s suffering,″ Park said. ″But I’m fighting. We hang in there.″

Boston University began managing the city’s schools two years ago because non-English-speaking students needed more services at a time of declining tax revenue. Since then, SAT averages have risen while dropping nationally.

But 80 of the city’s 300 teachers were laid off last month and the city’s 3,700 schoolchildren are idle.

Sheila Perez, 38, worries about what her 13-year-old son will do without school, especially considering the temptations of the street. Her 17-year-old daughter, Gina, dropped out and has a baby girl.

″I used to like living here, but now there’s too much drugs, too much crime,″ Perez said. ″I don’t want to bring my kids up here anymore.″

The state Senate is to debate the receivership bill Wednesday, followed by the House. If the bill passes, schools could open Monday.

Gov. William Weld introduced the bill, which would give the receiver power to hire and fire, alter zoning laws, merge departments and sell bonds. It would not grant the right to raise taxes.

The receiver would stay for up to five years, during which time elected officials would have only advisory power. Even after all that, Weld said, Chelsea may have to be annexed.

State Senate President William Bulger said Chelsea voters should override Proposition 2 1/2 , which limits the property tax rate statewide to 2.5 percent. Voters can increase the rate in their own cities. In April, Chelsea voters rejected an override by a 3-1 margin. Without it, the 1.9- square-mile city cannot increase its tax base because it has almost no land to develop.

″It seems to me that the self-help effort should be made by Chelsea,″ Bulger said.

Bulger said receivership could send the wrong signal to other cash-strapped communities that they can shirk taxes and still receive services.

But Senate Minority Leader David Locke, a Republican, said: ″My feeling is that unless someone comes up with a better alternative, the bill will probably go through. I don’t think anybody really likes it, nobody thinks it’s a cure- all.″

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