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GREENBURGH, N.Y. – The bubble will soon be in the hands of the voters.
After weeks of pouring over lease details and delaying a vote, the town board, minus a vacationing Ken Jones, unanimously approved a 15-year lease Monday that will likely bring a sports complex to Greenburgh – pending voter approval.
Supervisor Paul Feiner said the town board will hold a public referendum on the controversial plan for Game On 365’s “Westchester Field House,” hoping it puts to rest any uncertainty surrounding public support for the plan.
“I think this will take a lot of the controversy out of it,” Feiner said after the meeting. “My feeling is people want to have their voices heard and feel like they are a part of it.”
For weeks the proposed 94,000-square-foot domed sports field has been the center of attention in Greenburgh. Town officials have said the deal to bring the complex to the abandoned lot at 715 Dobbs Ferry Road would generate more than $5 million for the town over the course of its lease. It would also provide much needed athletic field space for area children, Feiner has said.
Critics, however, have attacked the plan, pointing to what they said are problems with the financial and legal aspects of the deal. On Monday, many said it was simply a bad business deal and there were too many flaws within the lease.
They cited things like undetermined remediation costs to clean up the site, the fact the area is zoned as residential and what they called "basement-bargain" rent being charged to Game On.
“Every time I look at this lease I see something that is bogus,” Tom Bock said. “It’s like a piece of Swiss cheese – there are so many holes in it.”
Ed Krauss agreed and said the lease is curtailed to benefit the developers, not the taxpayers.
“We have a lease that was pretty much written by them (Game On),” he said.
Others have suggested the lease may simply be illegal. Just hours before the scheduled vote, Irin Israel, a principal in the Elm Street Sports Group – part owner of Ardsley’s House of Sports complex – circulated a letter sent from Elm Street Sports’ attorneys to the town.
In it, attorney Ethan Strell wrote that leasing the property would be a clear violation of Westchester County law. He warned the town that if they went forward with a vote, Elm Street Sports was prepared to fight it.
“Should this Council continue down this illegal path and approve the lease with Game On 365, our clients will pursue all available remedies, including referring this matter to the New York State Attorney General,” he wrote.
Feiner dismissed any threat of legal action, citing state laws that allow the town to move forward.
“They didn’t read the law correctly,” he said referring the Elm Street Sports’ attorneys. “They messed up.”
The town board is expected to have a meeting Aug. 29 in which it will vote to approve a public referendum on Game On’s proposal to be added to the November ballot.
Comments (9)
I would have hoped that after 20 years in office, Mr. Feiner would have gained some knowledge of county, state and federal law, but apparently he continues to violate the law with these illegal actions, costing taxpayers millions in legal fees defending him.
Feiner only has six months of experience repeated 40 times.
The memo from the Town attorney appears to based on a faulty understanding of the law, as explained in the following post this afternoon on the ECC's facebook page:
TOWN ATTORNEY ASSUMES COUNTY LAWS WERE SUPERSEDED
When the Greenburgh Town Board voted last night to approve entering into a 15-year lease with Game On 365, it did so on the basis of a memo written by the Town Attorney which concluded that a county law mandating that property acquired in tax foreclosure sales be sold had been "superseded" by a state law enacted in 1993 which merely authorized towns to sell such properties.
However, the 1993 law, entitled the "Uniform Delinquent Tax Enforcement Act," merely states (in Section 1104 of the state's Real Property Tax Law) that it supersedes only those provisions of law in county charters that were "inconsistent" with the 1993 law.
Here, the Uniform Delinquent Tax Enforcement Act merely authorizes towns to sell such property. (See section 1166 of the RPTL). It is silent on whether such properties must then be sold. However, when a NY state statute is silent, and where as here, that gap is filled in by a county law, the county law is seemed to be not "inconsistent with" or "contrary to" but rather a "supplement" to the state law, and fully enforceable.
Assuming that is the case here, then the Town's authorization of a 15-year lease, instead of a sale of the property as required by county law, would appear to be plainly illegal.
Nor would such illegality be cured by a referendum, as Town Supervisor Paul Feiner has declared the Town will hold on the issue during the November election. In fact, it is illegal for the Town to hold a referendum that is not provided for by law. Here, if the property cannot legally be leased, then allowing a referendum on whether such property should be leased would be plainly illegal.
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The problem for the Town is that having embarked on this path, the courts will now have to rule on whether the lease was legal. If the court upholds the Town's position, which looks to be unlikely, the matter will almost certainly be appealed, which means the matter won't get decided for at least another year or two. But if the Town loses in court, whether initially or on appeal, the Town's taxpayers will have to pay not only the Town's legal fees, but all costs incurred by Game On to date for having entered into a lease which the Town was not legally permitted to enter into.
That may prove to be a very high price to pay for callous indifference to the law on the part of the Town's elected officials.
: Timothy W. Lewis, Town Attorney
DATE: August 13, 2012
RE: Section 283.611 of the Westchester County Code and the proposed lease of surplus Town property to Game On 365 LLC.
Confidentiality Notice
The information contained in this document is privileged and confidential information intended only for the use of the individual or entity named above. You are hereby notified that any dissemination, distribution, copying or permitting other than the individuals notified below from reading this communication is strictly prohibited and any violation or breach of this confidentiality will subject the violator to criminal and civil sanctions and penalties.
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This memo addresses the issue of whether Section 283.611 of the Westchester County Tax Code (Purchase and Sale of Tax Lien Property), which states that “the supervisor shall sell, either at public or private sale” any property acquired by the Town by reason of any tax lien, is still good law and means that the Town is unable to lease the property acquired pursuant to an in rem proceeding. In short, it appears that the Sections 283.391 through 283.631 were superseded by Article 11 of the New York State Real Property Tax Law (RPTL) in1993, are no longer valid and that Article 11 does not preclude the Town’s short term lease of surplus property to Game On 365, LLC or another entity.
The Westchester County Association of Tax Receivers and Collectors recognized the deficiencies of the Westchester County Tax Code and began a study of the Code in 2004 in connection with the enactment of Article 11 of the RPTL. As early as 2008, the Association recommended a thorough evaluation of the Tax Code to the County Legislature to bring it in conformity with the Real Property Tax Law of New York and current practice. Proposed revisions to the Code were forwarded by Ken Jenkins, Chairman of the County Board of Legislators to John Nonna, Chairman of the Legislative Committee on September 14, 2011.
The Association noted that Section 283 of the Westchester County Code sets Westchester apart from counties in the rest of the state. Not only does Westchester differ in assessment dates, collection months, and penalty fees, but more importantly, Westchester has a different structure for the enforcement of delinquent taxes. In the rest of the state, towns turn their delinquencies over to their county and are made whole-- the counties bear the debt and responsibility for enforcement of delinquent taxes, including foreclosures and auctions. Under Section 283 of the County code, towns in Westchester make the county whole, and towns bear the debt burden of uncollected property taxes.
Nevertheless, the procedures for the enforcement of delinquent taxes were revised substantially as of January 1, 1995, when Article 10 of New York’s Real Property Tax Law (RPTL) was repealed and replaced by Article 11, the “Uniform Delinquent Tax Enforcement Act.” Enacted in 1993, the provisions of Article 11 “supersede any inconsistent general, special, or local law,” unless such local municipality “opted out” by adopting a local law and filing it with the State Board of Real Property Services no later than August 1, 1994. Westchester County did not “opt out,” and towns in Westchester became subject to the new enforcement procedures of Article 11 on January 1, 1995.
§ 1166 of the RPTL, Real property acquired by tax district; right of sale, provides:
1. Whenever any tax district shall become vested with the title to real property by virtue of a foreclosure proceeding brought pursuant to the provisions of this article, such tax district is hereby authorized to sell and convey the real property so acquired, either with or without advertising for bids, notwithstanding the provisions of any general, special or local law.
2. No such sale shall be effective unless and until such sale shall have been approved and confirmed by a majority vote of the governing body of the tax district, except that no such approval shall be required when the property is sold at public auction to the highest bidder.
Consequently, Section 283.611 of the Westchester County Tax Code (Purchase and Sale of Tax Lien Property) has been superseded by Section 1166 and Towns such as Greenbugh are not required to sell property acquired pursuant to foreclosure resulting from a tax lien but are simply authorized to do so.
Presumed to be of sound mind and body is challenged by Feiner's intent in posting this memo from Tim Lewis; the memo itself does no more than pose a "he said, she said" scenario to which the final outcome will not be determined by random and saturated postings on Feiner's catalogue of media outlets. Not unlike Mr. Lewis' earlier case law citations which failed to impress either the State Comptroller or sitting judges.
What does signal that Feiner is becoming increasingly desperate is his attack on the "House of Sports" owners and Feiner's pathetic need to find a link between them and the force behind "Burst the Bubble's" founder, Simon Cohen.
How many days is it before Feiner displays an envelope containing the names of previously accredited "activists" and long term residents and accuse us of sabotaging his own, "impartial" support of GameOn?
And what if there were a direct link (other than being told of a standing friendship) and what if Simon were the paid or unpaid publicist for House of Sports? Does Simon sit on the Town Board? Does the Town Council report to Simon. One moment Feiner talks the democracy talk, free speech and that he listen even to his critics and the next moment he cries that mere citizens are holding up his pet project -- holding it up even though they hold no office or employment in town government.
Is Feiner demonstrating a mental health condition that suggests he is no longer fit to govern? How long to he publicly displays another meltdown? Will he stamp his feet and stalk off this time? Does Simon's influence extend to creating existing County laws or should communicating to Greenburgh residents be unlawful for anyone not privileged to use the Town's email delivery system or the Town's postage and copiers.
It was just a few months ago that Feiner was defending "competition" on Central Avenue. Now that there is competition rising elsewhere, including the hiring of lawyers, Feiner cries "unfair". Feiner, purity personified, never has he himself misled the public in any official communication on town letterhead, is by means the picture of squeaky clean on this current or any other matter in which he takes a personal interest. Conversely it would be correct to say that there is nothing that either House of Sports or Simon Cohen has/have done, jointly or separately, that is improper.
Doesn't it seem odd that the Town Supervisor is now waging war "on company time" against just one Town of Greenburgh property/business owner? Feiner's making a lot of allegations and residents need concern themselves if the outcome of his grandstanding smokescreen is going to end in one more Feiner-derived return trip to Court -- remember Fortress Bible. This time around being charged with defamation of character and intent to do economic harm etc. Feiner, more and more often, is venturing into the Problem Creator mode and its latest incarnation is Feiner in Jane Russell drag territory singing "Put the Blame on Mame".
Now mindful that a proper RFP was never conducted by the Town (no advertising to real estate professionals; no employment of Brokers either on an exclusive or non-exclusive basis; a 90 day response window; the dual "clouds" of soil contamination and existing residential zoning: it is nothing short of a "miracle" that the RFP attracted even the one lease proposal: that being GameOn. Indeed for those who don't believe that God has the time to look in on Greenburgh's financial needs, "miracle" may not be the correct term. The correct temporal description is that the process itself was designed for failure and to result in a narrow field of one, the one being in first and only place from even before the RFP existed. With so poor RFP response, an honest and concerned government would have withdrawn the property and rethought ways to encourage more response.
But to properly judge the market value one should have a larger universe than just one offer. So let's turn to some recent Greenburgh revenue additives that Mr. Feiner is similarly encouraging. With the 108 vacant units of affordable housing that were left behind as the aftermath of WESTHelp's forced departure at Lease expiration (ending $1,200,000 of annual rent) Feiner has been seeking to instead install Ferncliff College whose intent is to raze the 108 units and do ground-up construction of a campus with student residences. In effect, Feiner is promoting a ground lease with the future improvements to be paid for by the tenant. For this Lease, Feiner expects to receive starting rent of $530,000.
A few miles away and off the same Sprain Parkway is the Frank's location which too is a ground lease with the future improvements to be paid for by the tenant. For this Lease, Feiner expects to receive starting rent of $260,000 (including taxes) or half what Ferncliff would pay. Both parcels are of similar size.
Residents may remember (subject of the recent enabling State legislation so roundly applauded by Feiner) the anticipated leasing of a portion of the Town's owned and operated tennis courts to a private entity which desires to erect a bubble over just 9 of the courts to provide out-of-season season tennis playing experience. The original, intended Lease with an operator, Sportime was to grant Sportime the right to repave the 9 courts, erect a bubble over these courts at Sportime's expense, rebuild a tennis shop/locker area at Sportime's expense and provide exclusive use of these premises for roughly eight off-season months. A win-win said Feiner. And this win would set Sportime back some $225,000 for its limited possession. GameOn by comparison would have year round occupancy of a much, much larger site in a much, much better location, at the intersection of major, but local, roads (Dobbs Ferry Road and the Sprain Parkway). All this for just an additional $35,000.
So how come Feiner trumpets the potential revenue from GameOn as akin to the second coming?
Residents need to understand that this Lease is now a done deal. The Lease terms are no longer in question which is why Feiner had his Board vote for them before the Referendum. Having a Lease is not a prerequisite to holding a Referendum.
Ask Feiner what the Referendum is to determine and as of last night he was clueless. Instead he talks about democracy in action. Having been a lifelong resident of the United States, my observation is that whenever a politician has to resort to discussing democracy in action in this country, it is because he is guilty about denying its existence. People already know they are supposed to brush their teeth at night, that smoking is harmful, that cheating on your income tax is "wrong". They need not be reminded. That Feiner feels compelled to talk about democracy is but another Feiner deflection away from the reality.
What the Referendum will come down to is not the obligation to produce a better Lease but whether or not Greenbugh parents will be denied their inalienable right to have all taxpayers subsidize this right. Feiner, the master of the press release and use of the Town's email list and visiting your living room, will be spending the coming days, not dealing with the Town Budget problems, but instead on a road show to convince town-wide residents that Greenburgh needs to be a Sports Center.
With the already low levels of voter turnout, finding recruits easily persuaded that this is just what the doctor ordered is child's play for Feiner. Those most prone to doctor's orders are Greenburgh's Senior population who have the inclination and the free time to come out and vote in an off-year balloting period. It is not coincidental that one of the recent at no cost to GameOn give-ups is free but limited use of the intended indoor walking track. Free for Seniors means at a very high cost to all taxpayers.
Hal Samis
(second comment)
Revenue says Mr. Feiner. It's all about bringing in revenue to keep taxes down and preserve needed programs. And of course, although not a revenue issue, is pandering to the needs of new-born soccer moms who coincidentally all woke up the same day to learn that their precious Jacks and Jills needed places to play soccer. Mr. Feiner and his Commissioner of Parks (an ill-cast Gerry Byrne)
bemoaned this and came to the simultaneous conclusion (actually it took a few beats for Feiner's marching orders to arrive -- written on the same grade of paper as used on Mission Impossible -- to maintain a zero level of soccer fields at Town Parks. Think Central Avenue's unused level acreage which could accommodate three soccer fields with only the expense for six goalie nets AND still be available for the occasional weekend Flea Market or visiting circus.
So it must be just the visions of large amounts of revenue that has Feiner so revved up. That or visions of a payday in the future; a payday reminiscent of the nighttime visits to their home by Michael Anthony "But who would give me a million dollars?" on the condition that the gift and its grantor remain undisclosed.
Mr. Feiner is getting on in years and an enriched retirement beckons.
So how much revenue will the Lease with GameOn actually provide since that seems to be the justification for all the agitprop to make the Lease happen.
Who knows? It certainly is not apparent from the Lease that the Town Board voted to accept. The confusion has to do with how the Town (if indeed it was the Town) wrote the Lease. Instead of clearly stating the rent for given time periods (i.e. year 1, year 2, years 3-5 whatever) the Town chose to lump rent and taxes (to itself, to the County, to the School District, to all the other districts) together so that identifying just the "revenue" became as evasive as the search for the Holy Grail. This is not the Lease format of choice for most commercial leases. Several Lease revisions later (with Feiner expressing how he and Lewis "listened" to the public) it is still not possible to determine what is the total NET revenue to the Town. Why, because the made-to-suit Assessment (which gives nourishment to the taxes) remains an elusive catch. Town Assessor McCarthy is loathe to recognize that a Frank's in its prime was paying a great deal more in taxes (or not paying as it turned out) than the proposed GameOn facilities combined are expected to pay in their prime. A 94,000 sf indoor field house, a 15,000 sf clubhouse and 50,000 sf outdoor field area -- all 150,000+ sf revenue producing -- are not expected to produce the tax revenue yielded by Frank's much smaller operation. Thus, this special treatment should be of concern to the various taxing Districts which are being artfully robbed of their proper income the absence of which need be shifted to other taxpayers within the District.
Embarrassed by the revelations of the first Lease in which three and four year lease periods were written for the sole benefit of GameOn (the three year and the four year PERIODS were to pay but 1.5% increases in rent which included taxes), the Lease now provides annual 1% increases on just the Rent portion (unstated) and not the former Rent + Taxes payment combined. What this means is that the maximum annual rent increase will come to around $1800. Not a big gain when starting from a low, low base rent. The majority of commercial leases contain rent step-ups showing minimal increases are those that use the CPI as the match point. However even the last five years averaged CPI was 2.5%.
However, from GameOn's Business Plan (the prospectus to lure investors), those folks are a lot clearer as to the success of their venture. Given that the GameOn backers need a signed Lease as the first step to entice investors or lenders, it is no secret why they are so desperate to obtain the Lease. Less clear is why Feiner is so determined to accommodate them.
Given that it takes most businesses a few years to become profitable (after the years lost to construction following clearances -- zoning change, soil and traffic remediation -- it is reasonable to jump ahead in the GameOn Lease to a period when income has "stabilized". I have chosen the sixth year as such an occasion and this year for a reason. Although their Business Plan predicts profits of $1,000,000 (net income) in as early as the first year and rising to $2,553,000 in the fourth year when the Lease first shifts the tax burden to GameOn, it is in the sixth year that the truest state of disbelief (and revenue harm to the Town) is most graphic. In that year, NET INCOME has risen to $3,310,000 with $330,000 of that coming from just 7,500 sf of subleased space to retail tenants. In the original Lease, GameOn was to pay the Town $335,000 including taxes for the entire property. If it smells gamey to you, as it does to me, you may concur that the reason that Feiner is so proactive in procuring this Lease is for reasons other than to provide revenue...for the Town. more to come.
As Mr. Bernstein points out, it is Feiner and Town Attorney Tim Lewis who have "messed up", costing the Town's taxpayers millions of dollars in revenue
(Feiner's failure to renew the lease with WESTHelp costing $1.1 million so far in lost revenue at $100,000 each month the property remains vacant with no acceptable tenant in sight -- not to forget that Feiner and Lewis ok'd giving away half of that revenue when it existed to the Valhalla School District until the State Comptroller stepped in and put a stop to it; thus initiating the groundwork for the Town's half-hearted recovery of the $1.8 million illegally gifted)
and millions of dollars in fines and judgements
(Fortress Bible award coming and fallen tree settlement before and those other mentioned by Mr. Bernstein)
which hit taxpayers in their wallets; causing local taxes to rise for reasons other than the national economy. Reasons unique to Feiner and Lewis whose business as usual plan for the Town is...faulty and amply proven so.
Once again Mr. Feiner is dragging the Town's taxpayers along with him and Lewis on his latest road trip to ruin. But wait a minute, doesn't the Town have the highest bond rating? How can anyone question Feiner's financial acumen in light of this? Simply because the rating agencies have determined that despite the damage to their wallets, Greenburgh's taxpayers have enough left in their piggybanks to pay the debt service on the bonds (not Feiner) that are being rated. And when you don't deal with infrastructure needs head on but keep postponing them into the future, you don't incur much debt so that makes the few bonds that are sold to be adjudged "safe". It's all about the Town's ability to pay existing debt while little new debt is being issued (often replacing that which is maturing). Despite a steadily declining tax base (ratables) under Feiner's administration, the bond rating, not the rating on Feiner, remains at its current AAA level but Feiner takes care not to lose this by continuing not to resolve Town needs by biting the bitter pill of solving infrastructure problems because those expenses would cut into the growing portion of Town revenue that is being squandered on legal claims and legal services. And what does a high bond rating do: it makes the holder eligible to pay a lower interest rate. Since it costs anyone of any level of credit worthiness (or none) little at current interest rates,
this would seem to be the ideal time to sell bonds to provide a lowest cost availability of infrastructure needs rather than holding off to some uncertain future date. Yet we don't see a permanent repair for the Town pool, we don't see a new Courthouse/Police Station, we don't see the Town bonding the $4 million loaned by the Town's fund balance (everyone whether Greenburgh Water or United Water users contributes to the Town Fund Balance) to cover operating LOSSES by cheap long term money -- while no repayment plan exists for this money is the standing order from Feiner.
Appropriate to mention in this article is the Town's required cost to cure environmental damage done at its Taxter Road tree mulching site, a $4 million expense. I mention this because Town Attorney Tim Lewis has opined that the costs to cure the soil problems (years of spills and chemical contamination from different occupants) at the Frank's site which GameOn seeks to rent is estimated by Mr. Lewis, Esq. (obviously not an expert in curing environmental damage) is but $75-$100,000: a number which conveniently fits within the $81,000 that GameOn is committing toward its share of the clean-up. Oh, did I mention that GameOn is also paying the $44,000 cost of the Phase II study (the Town never ordered one before seeking RFPs) which is the basis of first finding out what soil damage exists and, only after knowing this, can the costs of curing be estimated. I would venture that perhaps Mr. Lewis should stick to law but then his results in that area are not AAA rated.
However since Feiner repeatedly says that this Lease is about providing much needed revenue, I'll discuss this in the next comment...coming right up.
Hal Samis
Because of the importance of the action taken by the Greenburgh town board tonight, readers are entitled to a more balanced and accurate report. Enclosed is the ECC facebook post:
TOWN BOARD APPROVES GAME ON LEASE, PLANS 'PUBLIC DISCUSSION' ON WHETHER TO PUT LEASE TO PUBLIC VOTE
Despite arguments that their actions were plainly illegal, four of the five members of the Greenburgh Town Board voted tonight to approve a resolution authorizing Town Supervisor Paul Feiner to enter into a 15-year lease of the former Frank's Nursery Property to Game On 365, a startup entity that plans to erect an eight story high bubble on the property to support an indoor recreational facility.
The fifth member of the board, town councilman Ken Jones, was absent. Mr. Jones is the only practicing attorney on the town board. No explanation was given for his absence.
The alleged illegality stems from the fact that the Westchester County Tax Law expressly requires without exception that all properties acquired by towns in tax foreclosure proceedings be sold. Leasing such property, as opposed to selling it, would appear to be plainly illegal.
Mr. Feiner and the town attorney Tim Lewis have defended their actions on the ground that state law generally permits towns to lease property, subject to "permissive referendum." And in this regard, Mr. Feiner tonight proposed that the town board authorize a referendum to be held at the time of the November election to "ratify" what the Town has done.
However, nothing in the Westchester County Tax Law appears to permit a town to circumvent the county law by holding a referendum. Westchester requires properties acquired by towns in foreclosure proceedings to sell such properties in order to make sure that sufficient monies are raised to cover delinquent taxes owed to various taxing districts, including schools and the county itself.
Westchester's tax law is part of the Westchester County Charter which was originally approved by voters in the 1930s. Under state law, the county charter and its tax law provisions would appear to trump any state law provisions authorizing towns to lease properties.
Mr. Feiner's actions tonight in getting the town board to approve the lease threaten to embroil the Town once again in litigation over an apparent disregard for state law.
Within the past five years alone, Mr. Feiner has been found to have violated state law in giving away millions of dollars in town revenues to the Valhalla School District, in refusing to comply with the state charter requirements of the Hartsdale Public Parking Commission, in illegally entering into a lease with Sportime for the tennis facilities at Veteran Park, and in refusing to comply with state laws mandating fair calculation of sewer taxes.
At present, the Town is also facing millions of dollars in potential damages arising out of Mr. Feiner's also having been found guilty of intentionally violating the First Amendment rights of the Fortress Bible Church. A ruling on the Town's appeal of that judgment is expected any day now.
On top of that, because of Mr. Feiner's failure to renew the $1.2 million a year sublease for WestHELP, the Town is losing as much as $100,000 a month by deliberately keeping the 108 apartments there vacant and deteriorating in violation of the Town's lease with the county -- and county law itself -- which requires as a condition of the lease that the Town lease the apartments to low and moderate income tenants.
It is not certain whether and when "Game On 365" will execute the lease. Any legal challenges to the Town's actions tonight will have to be brought within 120 days.
Assuming legal actions are brought, the legal status of the lease will likely remain in dispute for at least two years, during which time the Town will be incurring legal costs while at the same time receiving no revenue from the lease.