Last minute shuffling over Scolite (UPDATED, 2:11 p.m.)

Now, I'm hearing Mayor Rosamalia wants to keep the amendment and the ordinance the amendment amends - because that's what amendments do - on the agenda.

It appears Mayor Lou Rosamilia wants to pull sale of the Scolite property off the agenda in order to modify the terms but Council President Rodney Wiltshire, in an email to his fellow members, said he wants to go ahead with the vote - At least as of about noontime, Thursday.

There was a flurry of activity this ahead of the tonight’s meeting. Initially the mayor wanted to amend the provision granting RJ Valente a license to operate the South Troy property for up to 10 years based on a $100,000 down payment with the $900,000 balance due when the sale is approved by the state Legislature. Instead, the mayor’s amendment calls for a straight $1 million sale pending the same state approval and Valente would not be allowed to work the site until the sale is finalized. 

Then the mayor wanted to pull the ordinance all together but Wiltshire wanted to push the amendment and the amended ordinance to a vote anyway. As the sponsor, albeit at the request of the administration, he has that authority but it is highly unusual to push it through if the administration wants it pulled.  

Here is where it gets king of stick. It takes a simple five-vote majority to pass the ordinance as initially proposed. It takes the same number to pass an amendment to the ordinance. But, it takes two-thirds of the Council, six votes, to pass the amended ordinance since the Council has not had seven days to review the legislation.  

I’m hearing, as of Thursday morning anyway, there were five votes to pass the amendment and the amended ordinance but Councilwoman Erin Teta Sullivan, I-At Large, is the swing vote to get the needed two-thirds majority. If the amended ordinance is voted down, however, any member who voted with the majority – be it in favor or against - can bring it back to the Council for consideration.

You can read the Times Union editorial urging the city to put off the Scolite sale pending an FBI inquiry here.

Here is the text of Wiltshire's email to the Council:

the mayor would like an amendment made on the floor to the language.  change this from a lease and turn it into a sale making it contingent on the final sale and not have access until the state has made its approval. Final.
I have other thoughts which I will share with you later today, but before the meeting.
I will not pull this or table it, and we will vote on it tonight.

More information as it becomes available.

 

Lawyering up

BILL DUNNE

Two people at the center of the FBI inquiry into the goings on in Troy – albeit for different reasons – now have attorneys.

Sources tell me Bill Dunne, the Planning Department commissioner, has retained Jim Long, a longtime attorney who has done extensive work for the Democratic Party on both sides of the river. And City Engineer Russ Reeves, who was recently questioned by the FBI, has retained Michael Shanley, a longtime attorney who was described to be as an “old warhorse.” It is not believed Shanley  - who is not the ADA by the same name and it's not Terry or Don Shanley - accompanied Reeves when he went to Albany to talk with the FBI.

To recap, the FBI is asking questions about the demolition on King Street, the installation of sidewalks in North Central and the questionable use of federal Community Development Block Grant money and the deal to sell the Scolite property to RJ Valente.

RUSS REEVES

Reeves was called in to answer some questions and generally the FBI doesn’t call in potential targets. Dunne was suspended for five days without pay for not fully informing his boss, Mayor Lou Rosamilia, about the new sidewalks in front of Freedom Park in North Central – which were not among the CDBG projects approved by the Council.

While Dunne wasn’t directly involved in the demolition of buildings adjacent to Bomber’s Burrito on King Street it was questionable in they were vacant for years but were declared such a threat to public safety Fire Chief Tom Garrett ordered them immediately torn down without taking time to abate the asbestos. Also, coincidentally, the demolition was ordered while Reeves was on vacation. The questions on everyone’s mind is why were they demolished and who ordered Garrett to take them down?

CHIEF GARRETT

Dunne also played an integral part of putting together the deal to sell the Scolite property to Valente, which the Council is set to vote on Thursday. Other bidders, including Perry Companies, a conglomerate that includes Don Fane, claim the city modified the parameters of the Request for Proposal after bids were taken and are threatening a lawsuit should it be approved. Modifications include the construction of a $9-plus million road and the ability to lease the property with a $100,000 down payment rather than the $1 million purchase price.  

Most recently Long represented former City Clerk Bill McInerney during the years long voter fraud scandal. McInerney admitted on the stand to forging scores of minor party absentee ballot applications and absentee ballots during the ’09 election but struck a deal with special prosecutor Trey Smith to avoid jail time.

Lawsuit threatened over Scolite deal (DOCUMENT)

Attorneys for Perry Street Companies, a conglomerate who unsuccessfully bid on the Scolite property in South Troy, are urging the Council to vote against the ordinance that would allow R.J. Valente to begin operating at the site.

According to the letter penned by James Barriere of Couch and White, the city modified the terms of the Request for Proposal after the open bidding process was complete for the “benefit of one bidder.” Perry Street Companies, which includes Warren Fane, Inc., is asking the Council shoot down the ordinance the Finance Committee approved by a 6-2 vote and put the entire project back out to bid or it will commence legal action. The Council is slated to address the matter at next month's meeting. 

“To us, it looks like a classic bait and switch where the original bidders, including our client, were asked to consider a proposal scope that has now been substantially enhanced for the benefit of one bidder,” the Match 26 letter states. “We do not need to explore the reasons why this occurred at this time, but it is clear that it did occur”

Berriere said the city extended three considerations to Valente that were not included in the original RFP during the public bidding process:

-The acquisition of additional property by eminent domain and the construction of a new access road.

-Allowing the winning bidder to put a 10 percent down payment on the property “rather than the purchase price delineated in its proposal. As an aside Berriere said it is a “benefit that we assure you any commercial developer would greatly enjoy and covet.”

-A “license” for the bidder to begin work at the site “with the apparent ability to abandon the site at any time before it obtains title.”

“These post-award concessions represent material and improper changes to the basic terms of the RFP. They violate public policy and destroy the fairness of the bidding process,” according to the letter. “The city is no doubt aware of the requirement that a procuring agency should be guided by the underlying policy of treating all bidders alike ‘so as to avoid the possibility of fraud, corruption or favoritism.’”

Here is the post I wrote about it after the Finance Committee approved it.

In In August, 2013, the city awarded the Scolite property to Valente and agreed to enter into “exclusive negotiations” with the company on how to develop the site. In June, 2013, Valente purchased the adjacent Bruno Machinery property for $750,000. In October, 2013, the city changed the zoning from commercial to heavy industrial at Valente’s request even though he did not yet formally own the property.

Earlier this month, the Finance Committee approved the ordinance that would grant Valente a license to operate the site with a $100,000 down payment on the company’s $1 million bid to purchase the site. The license, according to Planning Department Commissioner Bill Dunne, was necessary pending approval from the state Legislature, which could be a drawn out process.

Also, the city said it would spend some $9 million on building an access road along the waterfront in South Troy and take the adjacent Ludlow Valve property through eminent domain and give it to Valente.   

Perry Letter

Valente answers Scolite concerns (DOCUMENTS)

SCOLOITE 

     Attorneys for R.J. Valente answered concerns raised by one of the entities that was not awarded the Scolite, in part by saying they were not aware the city was planning to build an access road at the time it requested proposals from interested bidders to develop the South Troy site.

“RJ Valente Companies in submitting the RFP had no knowledge nor discussion of any industrial road being extended to the Scolite site and all submittals were based on the information available at the time to all parties,” wrote Joseph Zappone, an attorney for Valente. “RJ Valente Companies was made aware of the city’s thoughts for proposing their scope of improvements from the King Fuels property to connect north up to the Congress Street Bridge most recently on our about the beginning of 2014.”

The letter goes on to state the Valente proposal has been approved by an 18-member panel as well as the Zoning and Planning boards. 

In August, 2013, the city awarded the Scolite property to Valente and agreed to enter into “exclusive negotiations” with the company on how to develop the site. In June, 2013, Valente purchased the adjacent Bruno Machinery property for $750,000. In October, 2013, the city changed the zoning from commercial to heavy industrial at Valente’s request even though he did not yet formally own the property.

Attorneys for Adams Street Properties, a conglomerate that includes the company of Warren W. Fane, wrote a letter asking the city to put the property back out to bid since a constructed road wasn’t included in the Request for Proposal documentation. If it were, the letter states, their parameters of their own bid may have been different. Furthermore, the company is concerned, according to the letter, with the industrial road crossing on property owned by Adams Street Properties and with the potential of eminent domain being utilized to take their property for such a construction.  

 The city does have some $4 million of federal money it is planning to use on constructing the road and the money has to be spent by sometime in September.

How the truck traffic will get back and forth from the Scolite site to Route 787, the nearest highway, with minimal disruption to the South Troy neighborhood is a bone of contention among neighbors and a challenge to those looking to develop the site.

It appears that if the city doesn’t put the chunk of land back out to bid the Fane group will sue. If they do go back out to bid with the inclusion of the road Valente will sue. In their respective letters, the two companies outline their stances on what they think should happen.

(The Fane letter can be seen from the post linked above and the Valente letter can be seen below)

Final approval of the sale to Valente was pulled from the city Council’s Feb. 6 regular meeting agenda by Mayor Lou Rosamilia because members had some questions as to the bid process. It was also not on the Council’s March Finance Committee agenda.

The other two bidders on the Scolite properties were Collar City Aggregate and Land Development of New York.

 

Valente Letter

Scolite sale hits a snag over access road

Scolite and Bruno Machinery

Final approval of the Scolite property was put on hold, in part, because attorneys for one of the bidders that were not awarded development rights to the South Troy property has concerns about a change in the project’s specifications and wants it put back out to another bid.

Attorneys for Adams Street Properties will be meeting with the Council. The matter was pulled from the Council's Feb. 6 agenda by Mayor Lou Rosamilia.

In August, 2013, RJ Valente, was chosen out of four bidders to develop the property. In June, 2013, Valente had already purchased the adjacent Bruno Machinery site for $750,000. In October of last year the city, at Valente’s request, changed the zoning from commercial to heavy industrial though Valente had not yet formally purchased the property.

As part of awarding the bid to Valente, the city planned on entering into “exclusive negotiations” as to the development of the site. The city, however, has not said what that actually entails. According to a statement by city spokeswoman Jessica Sibley at the time: “More details of the project will be disclosed as negotiations progress.”

But, according to a letter written by an attorney for Adams Street Properties, one of the three other bidders, their initial proposal to the city included “access to the Scolite site over their adjoining properties and public streets northerly to and from the Congress Street Bridge, as well as rail and Hudson River access.

“My clients have now been advised that the city proposed to provide access to the Scolite property for the apparent sole benefit of the pending successful bidder via a new roadway to be constructed in part through the lands of the Perry Companies, running southerly from Monroe Street,” according to the Feb. 5 letter written by attorney William Doyle.

“It is our clients’ position that this proposed access was not part of the original Scolite proposal, and is a substantial deviation from the original project scope,” the letter continues. “We are hereby requesting that the city reexamine the Scolite redevelopment terms and bid and take into consideration this substantial deviation.

“We believe such review will confirm the necessity of a new request for proposals for the redevelopment of the Scolite site.”

The letter goes onto state that in order for the city to provide the access described it would have to either get permission from the Perry Companies or take the land through eminent domain. Boyle said his clients would not give permission, so the only other option is for the city to purchase the necessary land at fair market value.

Scolie letter

Talk of an access road through the South Troy Working Waterfront as a way to spur development and keep heavy trucks out of residential neighborhoods has been ongoing for about three decades. While a solid concept, several hurdles stand in the way including the number of actual property owners that would either have to sell land or sell easements. Also, federal law prohibits the building of anything within a certain distance of the railroad tracks that run along the river.

The council was slated to vote on the sale at the Feb. 6 meeting, a day after the letter was sent, but was pulled from the agenda.

Adams Street Properties, according to the letter, is operated by Jack and Cynthia Perry. It also includes other entities with financial interests including Warren Fane Inc.

The other two bidders on the Scolite properties were Collar City Aggregate and Land Development of New York.

It’s unclear if the Adams Street Companies, or one of the other bidders who were not privy to the new road configuration, will bring a lawsuit if the project does not go back out for another bid.