Taxes and Fees
2012 proposed Lancaster budget, fiscally responsible or smoke and mirrors; Part III: Government Waste
By Lee Chowaniec
Oct 20, 2011, 10:46
“We need to give taxpayers a breather,” stated Lancaster Supervisor Robert Giza in a Lancaster Source commentary on the 2012 proposed budget. And then what, back to raising taxes in a town where despite touted town growth spending and taxes have increased significantly in the past several years.
Residents who spoke at the budget hearing did not challenge the budget in itself, rather what is in the budget and what has led to a time where employee benefits are no longer sustainable, where too generous longevity pay, stipends, and perk programs are unaffordable. Town spending has been out of control for a number of years.
At the recent Town Board meeting residents Dan Beutler and Lee Chowaniec also took the town to task for the government’s waste in taxpayers dollars for the police/courts building project.
A few months ago Councilman Mark Aquino submitted a Lancaster Bee editorial where he declared the town acted responsibly throughout the purchase of the Walden Avenue Colecraft Building, the feasibility studies and citizen’s lawsuit that followed, reasons for the eight year delay in constructing a police facility and the decision to build new – when residents supported such move from the get-go in 2003.
The delay has cost Lancaster taxpayers millions in the process and denied the police from having a facility they deserved eight years ago.
Several months ago Councilman Mark Aquino posted a Lancaster Bee Letter-to-the Editor declaring the Lancaster Town Board acted responsibly from the time of the purchase of the Walden Avenue Colecraft Building to the recent decision and reasons given thereupon to build new police/courts facility on Pavement Road.
Recently Mr. Aquino defended his position at a Town Board meeting, stating he would not retract one statement, while admonishing resident Henry Gull by telling him he did not know what he was talking about.
Since then several residents involved in the process have gone back in time to review documents and town official depositions taken during a lawsuit instated to challenge the waste of taxpayer money for a feasibility study performed when in fact the Colecraft Building contract sale contingencies were already met.
Mr. Aquino declared that the Colecraft Building was not legally purchased until the day of closing took place, on July 21, 2003. Mr. Aquino said that until closing took place, when the title was exchanged, the contract was still voidable.
The two contingencies in the sale contract were met long before that date. The building inspection had been completed by Clough Harbour & Associates in early May and the April 28th authorized bonding resolution for $1.9 million was approved by the lending institution on somewhere around May 13th.
In the Sale Contract it specified that the conditions (contingencies) had to be met in 50 days, by June 3rd. They were met and not contested by either seller or buyer within that time frame.
But there was another contingency that held up the process and was not brought to light until the May 12th impromptu meeting with the Village of Lancaster officials. That contingency was that the bonding of the $1.9 million for the building purchase and was subject to a 30 day permissive referendum.
Yes, the residents should have picked the referendum statement in the public notice statement published in the Lancaster Bee. At the same time, when residents asked the then Town Attorney whether a permissive referendum was allowed, they were told no, that it was not.
When also asked in mid May whether the contract was voidable, the same attorney responded “I suspect it is.” His answer was most likely predicated on the fact that the referendum timeline was still active, not that the two sale contract contingencies had already been met.
Sometime after the Colecraft Building purchase closing, a citizens group instated a lawsuit against Town Board members for fraud. Taxpayer money was wasted on a feasibility study to determine best building option on three sites when in fact the 3949 Walden Avenue Colecraft Building was already purchased.
What is most offensive to those individuals that instated the lawsuit, and equally irresponsible, was that this group was blamed for years for delaying the project’s movement. Mr. Aquino stated that the then Town Attorney advised the board not to move forward with the project because of the lawsuit. In a sworn affidavit the lawsuit defendants own attorney (Charles Case) stated the following:
“At the outset, it is useful to note what this lawsuit is not about. This suit does not challenge the building purchase that the town ultimately made for a new police headquarters, courts facility and other town functions. This suit is not about the defendants’ authority to enter into such an argument to buy the facility.”
It should also be noted that when dismissing the lawsuit Justice Christopher Burns declared, “There was no criminal intent, just faulty governance.”
A letter had also been submitted to the Supreme Court by the plaintiff attorney explicitly stating that the suit would no longer be pursued.
And you continue to stand by your statement that the town acted responsibly? They did not!
Lee Chowaniec comments
This is a follow up to Mr. Beutler’s comments, as together with the assistance from several other town residents, we did extensive research on this matter. Looking at past lawsuit depositions, documents, exhibits, etc., I make the following observations:
Mr. Aquino, you stated in your Bee editorial and re-affirmed your position at a later town board meeting under challenge that the town acted responsibly with the purchase of the Colecraft Building and the project process thereon.
In once again reading through all the lawsuit depositions, feasibility studies and exhibits, I believe that the Town Board did not act responsibly in 2003 when the Colecraft Building was purchased and for the next 8 years from then.
Mr. Beutler has already established that the citizens’ lawsuit had no impact on the delay that has taken place in building a police/courts facility. With that in mind, the following should also be noted:
1. There never was an appraisal done to establish building or equipment purchase value.
2. There was a third contingency that made the contract voidable, namely, 30 day permissive referendum from the April 28th bonding of $1.93 million. The other two contingencies, building inspection and bank approval of the bond application were completed by mid May. Two deposition respondents confirmed the Colecraft Building purchase was not voidable after the contingencies were met.
3. Residents who visited the Colecraft Building made their reservations noted on building integrity structure and when they asked if a permissive referendum was possible they were told no by the then town attorney.
4. At the impromptu meeting held between town and village boards on May 12th, Supervisor Giza told Village of Lancaster board members that the total cost of the project would come in at $4 - $5 million. When village board members voiced their concerns Supervisor Giza told them that they were no longer in the police business, but he agreed to another study, the Trautman & Associates feasibility study.
The Trautman feasibility study was performed to determine which of three building options was more cost efficient. The study indicated that the Colecraft Building was the cheapest option, at $6.9 million. That was in addition to the $1.63 million already spent on the purchase of the Colecraft Building. The option to purchase and use the Village Municipal Building came in over $12 million and a new build came in at over $13 million.
5. To sell the Colecraft Building design as the most cost-efficient, Trautman estimated the cost of a new build for 77,000 square feet; at $13.2 million, at $172 per square foot in 2003.
6. The town just bonded $10 million for a new 27,000 square foot police/courts building and a separate shooting range of 9,000 square feet. A 40,000 square foot new build could have been had for $7 million in 2003.
7. The Colecraft Building cost $1.93 million to purchase. Add to that $750,000 in interest payments and at least $750,000 in combined revenue lost in property taxes from taking the property off the tax rolls, and add in building maintenance expenses over the eight year timeframe.
8. The interest on the $10 million bond will most likely approach $2 million.
9. Add all those costs together and you are over $15 million. $15 million spent vs. $7 million and interest payment in 2003 on a 40,000 square-foot new build. And we have had an eight year delay, and you call this responsible?
10. In that eight year delay, the town was advised to sell the Colecraft Building and build new, no less than by residents, a town justice, a sitting board member and other town officials. The sale was never formally pursued.
11. Lastly, Mr. Aquino I cannot understand why you opened this can of worms when you were not directly involved with this process early on. Your defense of a project that has wasted millions of taxpayer dollars is both perplexing and disturbing.
Yes, this is a good budget proposal, but the town’s past spending and tax increases have to be scrutinized as to reasons for.
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