HISTORICAL DOCUMENTS | 9/11 Recovery Report
Updates for Shareholders & Beneficiaries Regarding DIT Operations After September 11, 2001
from Stuart Money, Executive Director
Final Update: December 7, 2001
As of September 13th:
Fiduciary Trust International, custodian and disbursing agent for the DIT, and formerly headquartered in the World Trade Center, is operating from their disaster recovery center in New Jersey.
All DIT fund and account data are intact and will shortly be accessible. However, the DIT office, located 2 blocks south of the WTC, will not be operational until power and telephone service is restored and nonresident civilians are allowed back into the area.
The DIT Income Fund manager, his staff, and most of the custody staff handling DIT accounts were successfully evacuated from the 90-94th floors of the South Tower. However, many of the other custody personnel remain unaccounted for, including Ed Abad, the Senior Vice President with prime responsibility for DIT accounts. Kindly keep him and his family in your prayers.
[Harbor Capital, in Boston, manager of our Equity Fund, were evacuated on the 11th but are now functioning normally.]
As of September 17th:
An office has been opened close by the NYSE where restoration of services questions may be addressed to representatives from Verizon, Con Ed, the NYC Development Authority, and others.
I visited there today, Monday, and learned the following:
Restoration of telephone service may be expected within 1-2 weeks. In the meantime, Verizon will arrange within "2 days" for calls to the DIT telephone number to be transferred to my home.
Power to the area is expected to be restored between Thursday morning, 9/20, and Saturday morning, 9/22
There is a significant caveat, however, to the power restoration scenario. The City has established a "no-work" zone into which restoration workers, to insure their safety, are not permitted. The map shown to me by Con Ed had our building, 74 Trinity Place, just outside the southern boundary of the no-work zone. But the map shown me by the Development Authority had 74 Trinity Place just inside the zone. If inside, although there may be power in the area, power within the building may not be restored until the City has authorized entry.
Trinity Church, our landlord, reports that the building appears okay visually, but are moving their offices to another of their sites due to difficulty of access to the area and to the massive cleanup required for their extensive, multi-floor operations. Fortunately, with our one-room office, and no need for public access, these concerns should not present insurmountable difficulties for us.
Once power is restored and access permitted, we should shortly thereafter be operational, although perhaps temporarily lacking direct phone and fax service. If our computers are not functioning, means are available for the restoration of all program and data files. Trading capabilities in both the Equity Fund and Income Fund are functional. Certain aspects of custody services at Fiduciary Trust are not yet quite fully operational, due largely to their loss of many custody and tech support personnel, but will not seriously or permanently impair DIT's functioning. Direct shareholders who had subscriptions or redemptions that normally would have been processed by us and Fiduciary during the second week of September, as of August 31, will still have these transactions processed as of that date using the 8/31/01 net asset value per share.
Mail delivery to our zip code has been suspended indefinitely, but is being held at the GPO, whence I will retrieve it periodically. Please feel free to call me at home (201)798-7465 should you have any particular concerns about our status or your accounts. But I must ask in advance for your patience as I operate from this "home office." Be assured that we are doing our best to be responsible stewards in this crushingly sad and difficult period. The sights (and smells) I experienced today from the corner of Liberty and Nassau Street--2 blocks from ground zero--were truly appalling and beyond comprehension.
As of September 21st:
The good news:
Fiduciary Trust has told me that distributions to trust beneficiaries should occur according to their normal schedule; i.e. each individual beneficiary should receive its distribution going forward according to the same schedule it has received them in the past.
DIT mail is now being held at the Bowling Green Station -- evidence that, building by building, the Financial District is slowly approaching 'normalcy'.
A contracted building cleanup crew is already at work at 74 Trinity Place.
I have an appointment to make a police-escorted 15 minute visit to our office this afternoon to retrieve essential business materials.
The less than good news:
The 15 minute visit has just been canceled. Building management now says access is sporadic and unpredictable and could not, at the moment, schedule a replacement visit. A delegation from Trinity Church is going to Police Headquarters to try to resolve the access issue.
A fellow tenant on our floor has told me that he has been given to understand that permanent re-occupancy may not happen until mid-October. I have been unable as of yet to confirm this estimate but hope it is a bit pessimistic.
Given the above, I'll continue to seek access to the office; but, in the meantime, I have requested overnight deliveries from San Francisco of installation software which, coupled with our backup disks, will assist in portfolio management from my home. Third quarter dividends will be declared as usual. Individual portfolio appraisals will likely be mailed to direct shareholders later in October than would normally be customary.
As of September 28th:
Finally, there is some news that appears substantive and is not changing daily, as earlier reports had. Access to 74 Trinity Place has been somewhat eased, although the building is still guarded by National Guard personnel. Cleaning crews have been readmitted and are hard at work. There is no water in the building, but it is "crawling with contractors," primarily plumbing and electrical. Power has been restored throughout, but restoration of phone service is many days away and impossible to reliably predict at this time. Calls to the( 212-) and (888-) 964-2444 numbers are being forwarded to my Jersey City residence.
I now expect to gain first access to the office--limited to 20 minutes--at noon on Monday, October 1st, to begin removing materials essential to start setting up a satellite office at home. At the same time, I'll be meeting with a project manager from Maxons' Restoration, the cleaning contractor engaged by Trinity, to arrange for professional cleaning of the DIT premises and equipment. A temporary off-site facility is necessary because re-occupancy of the DIT office is now estimated not to be likely until the end of October, plus or minus a week or so. I hope soon to have fax capability at home so that faxes sent to the office will be forwarded here. Mail sent to the NYC office will continue to be retrieved from the Bowling Green P.O., but to expedite delivery, I recommend you address mail to:
Diocesan Investment Trust
c/o Stuart Money
44 Sherman Place
Jersey City, NJ 07307-3028
Re-occupancy of 74 Trinity Place will likely be delayed, not due to the building's unreadiness, but to the continuing intense recovery and debris removal effort at the WTC. Both Trinity Place and Greenwich Street, at the rear of our building, are primary arteries for the flatbed trailers carrying large structural elements--it's a constant procession. Also, many utility cables and conduits have been laid above ground in the area. And in front of our building is an inspection station where every vehicle is stopped and inspected by the National Guard--interior, exterior, and undercarriage (3 Guardsmen actually roll under the vehicle to do this)--before being allowed to proceed to Ground Zero. A grimly distressing reminder of the reality of it all.
I greatly appreciate your patience and understanding as we confront the challenges of the next few weeks.
As of October 5:
Success! After going through several National Guard and Police checkpoints and waiting in a block long line to be assigned the required police escort, I arrived at 74 Trinity Place this week. I was able to gain brief access to the office and to start removing materials and equipment essential to begin setting up basic operations at my residence. The condition of the office was not as bad as I had feared, but there was a layer of dust over everything--quite thick in some areas (I sneezed a lot). Arrangements have been made at a very reasonable cost for professional cleaning. The operating condition of the office equipment remains an open question.
The building is still without water, as there have been some significant plumbing problems. However, the building manager has told me he expects all clean up and "mechanicals" for the entire building to be in order by mid-month. Unfortunately, the building is not high on the City's priority list for authorizing re-occupancy, since it is in an area of the red zone that remains highly active. Best guess for re-occupancy is now early November. Phone service has been restored, but please do not send faxes, as I am unable to retrieve them. Voice calls to the office will continue to be forwarded to my home.
All subscriptions and redemptions, including reinvested dividends, will be processed as of the customary dates, but the mailing of confirmations of these transactions will be delayed. The mailing of third quarter dividend checks may likewise be somewhat delayed beyond the usual October 15th. Buy and sell transactions within the two Funds are proceeding normally.
Please don't hesitate to call me should you have any questions concerning the status of your account.
As of October 19th,
I had my second, quite brief, police-escorted visit to the office earlier this week. There was a very brisk wind blowing and, within a few blocks of ground zero dust was everywhere, including in the office, which had not yet been cleaned. However, our building manager told me today they expect cleaning to be completed shortly. But I learned from him that, contrary to the best information available from my last update, the timing of city authorized access and building readiness now appear to be reversed. It is hoped that free access to the site may happen this weekend; this is clearly, however, a moveable feast. Building "mechanicals", which were expected to be fully operational by now, are not and will delay re-occupancy. When everything was powered up and turned on, additional problems occurred which may take up to ten days to correct. The date of early November for re-occupancy still appears to be a good one, but no one is willing to fully commit to it.
Fiduciary Trust's custody section will be moving tomorrow from their disaster recovery site in New Jersey to their permanent relocation at 600 Fifth Avenue; our Income Fund Manager and his staff will follow around November 1. Their custody personnel have been attempting to operate under very difficult conditions and have been extremely difficult to reach. This should improve considerably after their move, but of course does not replace all the people they lost. Fiduciary's reports for September and the final reports for August I received by hand early last evening, so I am now working at completing closing the books for both months, establishing confirmed net asset values, and processing subscriptions, redemptions, and third quarter dividends.
Portfolio appraisals as of September 30 and dividend checks to shareholders not reinvesting should be mailed next week. A somewhat extended quarterly letter to shareholders and beneficiaries should follow thereafter. Reinvested dividends will have been subscribed as of 9/30. Dividends to trusts should be posted by Fiduciary next week. The Trustees are meeting Monday, the 22nd; joining them will be the President and Chief Investment Officer and the Director of Research from Harbor Capital Management, manager of our Equity Fund--for a thorough review of the Fund's performance, positioning, and market outlook going forward.
Unless there are significant changes to the foregoing, this should be the last update. Operating off-site without access to files, including client files, is difficult; but all essential functions are being covered. Thank you again very much for your continued patience and understanding.
Note: September net asset values will be posted on our home page as soon as available.
As of December 7th:
I had hoped that the previous update given on this site was to be the ultimate update. As those of you who read the last quarterly letter to shareholders and beneficiaries know--it wasn't. Nor was it the penultimate update, or even the antepenultimate update. Since the re-occupancy date of 11/15 cited in the letter, we were given a new date of 12/1, and have most recently been given the date of 12/15. So, for those of you who might be interested, let me bring you up to date.
There are essentially three problems preventing re-occupancy at this writing. In increasing order of difficulty of resolution they are the following:
• Environmental air testing is to be performed throughout the building again this weekend. It's been done before and found to be OK, except in the basement, where it is expected not to be in compliance perhaps for some months (until debris removal is completed). That will not prevent re-occupancy of upper floors, but testing is being done again to increase the level of management's assurance to tenants that the air is acceptable. It is somewhat less than reassuring that all windows have been taped shut and covered with plastic sheeting, and that cleaning of all air ducts will be performed at least monthly until ground zero reconstruction is begun.
• The building's fire alarm system is inoperative. It uses Verizon telephone lines which are not yet restored. Verizon has done extensive work in the building, installing an entire new "hub", so that virtually all interior lines are working; the fire alarm problem is with unrestored lines in the ground zero area. Re-occupancy will not be permitted without an operating fire alarm system unless a manual fire watch is instituted. If necessary at 12/15, building management is prepared to do this.
• Two unimpeded street exits are required before re-occupancy will be authorized. Our second exit is on Greenwich Street (the rear of the building). This exit is blocked by an 8-foot high barrier across the street--building to building--erected by the city with no prior notice or consultation. All trucks carrying debris from ground zero have to be washed down before leaving the area. The washing 'station' is directly behind our building, and the barrier was erected to secure the area, since anything north of it is still considered part of the 'crime zone'. Had the barrier been erected 10 feet further north, we would have had unimpeded egress from the exit. Good planning, huh! Management has been trying diligently to get the barrier moved for some weeks now. Although the Mayor comes across as having all the answers and being totally in control--and to a remarkable extent he is--apparently confusion reigns among those beneath him with respect to allocation of responsibility and decision-making authority. However, as opposed to receiving assurances from the City that they would try to move the barrier by a certain date, management has now been told that the barrier would indeed be moved tomorrow. Keep your fingers crossed, but don't hold your breath.
Needless to say, continued lack of access to client files and other data and supplies in the office continues to impede the efficient functioning of DIT operations.
The other significant impedance has been Fiduciary Trust's delayed reporting, although transaction processing has proceeded reasonably well. But there is improvement on this front. While Fiduciary is still hampered by their tragic loss of personnel, all of their operations have now been restored to Manhattan. They are, however, working out of two sites: 55 Water Street and 600 Fifth Avenue, which itself contributes to impaired responsiveness. Nevertheless, their staff with whom I deal have been extraordinarily cooperative, making every effort to respond to our needs in as timely a fashion as possible. Closing our two Funds for November will be an interesting test case to see if turnaround time can be shortened, with DIT reporting restored closer to a normal time frame.
With year-end just around the corner, we're entering an exceptionally busy time for the DIT. In the hope that normality will soon be restored (just moving back into the office and resuming operations there will be a challenge), our annual outside audit has been scheduled, as is customary, for the third week of January. Extensive preparation is necessary, requiring use of materials both in the office and provided by Fiduciary, in order to be ready for the audit and to limit the amount of time spent on-site by the auditors. Alternative dates have been discussed with them in case it's not possible to close the year by the set date. But I am hopeful that all will go as planned and that copy will be available to be sent to the printer in time for our Annual Reports to be in your hands before the shareholders' meeting in April. I hope that you will hope along with me.
Meanwhile, thank you yet again for your continuing patience and understanding. No further updates will be posted unless there are significant changes to any of the above.