By Michael Sussman, Esq. (Goshen) - In 2001, four Orange County residents: Rudy LaMarr, John Frontera, Quincy Magwood and Sal Cucorullo pooled resources and abilities to propose a new first class entertainment center for lower Broadway in the City of Newburgh. Leasing an old and vacant furniture store, the group received variances from the Zoning Board of Appeals allowing the conversion of this property to a site which would attract first class talent and provide a locale off the waterfront and on Broadway for social gathering.
In 2002, having obtained these variances, the group presented its proposal and a lengthy business plan to the City of Newburgh’s economic development office. That office reviewed the plan, made suggestions and the Savoy group made improvements. There is no evidence of any untoward favoritism granted Savoy in this process.
In June 2002, Sal Cucorullo spoke with his childhood friend, Nick Valentine about Savoy. Valentine was then a member of the City Council. Valentine told Cucorullo that there was no way he would support anything Rudy LaMarr was involved in and that the project would fail. Cucorullo appealed to Valentine, but the Councilman would not listen and told him not to associate with LaMarr. In the meantime, Patrice Cucorullo was making presentations of the financial viability of the Savoy project to members of the Newburgh Local Development Corporation. By this time, Valentine had known Patrice for more than 35 years.
In June 2002, with the support of Lester Spellman, the LDC voted to provide bridge financing, through either a direct loan or through a CD placed with a bank as collateral for a loan the bank would in turn make to Savoy. The purposes of municipal support were two-fold
1. To allow Savoy to have sufficient funding to qualify for a major construction loan from an identified lender and
2. To help Savoy to buy the furniture building and thereby collaterize the City’s guarantee.
Valentine abstained from the vote claiming he knew the participants. City Council member Stephen Rockafellow opposed the project and so voted. A few days after this vote, with the express approval of the Mayor and Mr. Spellman, the City Comptroller transferred $380,000 to Savoy as a bridge loan. The City then expected to get Hudson United Bank to replenish these municipal funds. The urgency of this loan related to Savoy’s need to show sufficient resources to qualify for the major construction loan needed for the project.
In mid-July 2002, at a City Council meeting, Rockafellow and Valentine issued a public statement which vilified the Savoy and, more particularly, attacked Mr. LaMarr. In their statement, these men insinuated that LaMarr was responsible for the loss, some 20 years before, of $100,000 by the Hudson Valley Freedom Theater, had failed to rehabilitate housing units made available by the City to a not-for-profit organization and was an unreliable individual. At their sworn depositions several years later, neither man could support factually any of their accusations against Mr. LaMarr.
With the uproar these men fomented, Savoy lost its construction financing, HUB pulled away from its deal with the City of Newburgh and Savoy was left unable to carry out its planned project.
In August 2002, the City demanded that Savoy return the funds provided the prior June. Savoy had already expended $130,000 on the rehabbing of the building and promptly returned the other $250,000.
In late August, the City agreed to provide these funds to Savoy again in exchange for an interest in the personal residences of the Savoy partners. The partners balked at this requirement, claiming it was unlike those imposed by the City on others borrowing money for economic development projects.
In October 2002, Mr. Valentine and Mr. Rockafellow gained control of the IDA and LDC Boards when Councilwoman Regina Angelo changed political allegiance. With this three member councilmanic majority, Valentine and Rockafellow booted two members of the LDC who Mayor Marino had appointed and replaced them with two more loyal members.
In forthcoming months, Savoy tried to resurrect its project, but the City was unwilling to make a loan which would be consistent with Savoy’s need to provide first position on their homes to a major funder.
Eventually, the Savoy partners sued the City and Valentine and Rockafellow in federal court, claiming that their withdrawal of support was politically motivated pay-off for LaMarr’s association with and support for Mayor Marino. Meanwhile, the City sued Savoy and the individual partners seeking to collect the $130,000 provided in June 2002.
Press coverage of this story has focused on Mr. LaMarr and failed to note the reason Savoy filed its suit to begin with: Rockafellow and Valentine refused to deal fairly with Savoy because of their desire to punish LaMarr and those associated with him. They wanted to punish LaMarr for his support of Mayor Marino, Audrey Carey and other Democrats seeking office in Newburgh. This motivation violates the constitutional right of LaMarr to engage in political association and activity without retribution and the right of his partners to associate with Mr. LaMarr without fear that their investments will come to nil because of a political grudge.
In late spring 2006, the federal court dismissed Savoy’s federal civil rights suit without reaching these issues. It simply relied upon Judge Slobod’s decision of April 2006 which held that the Savoy partners owed the City $130,000 based on their signing - in late August 2002 - a written agreement which compelled, the Judge found, the three then partners to put up their homes as collateral for the $250,000 loan balance. Judge Slobod never heard evidence of the political retaliation presented in the federal civil rights case and never made any rulings concerning the legality of the City’s actions.
As much as the Joseph Waldman case involving the Grand Rabbi’s interference with public school board elections in Kiryas Joel was intended to vindicate the right each person has to participate in the political process, so, too, does the Savoy case raise the same issues. We showed Judge Brieant that Valentine and Rockafellow were involved in the dispensing and
monitoring of many loans as Directors of the Kingston-Newburgh Enterprise Corridor and that in that capacity, they never required personal guarantees from lenders and never went after wildly delinquent lenders. Their actions here were quite different, motivated by a desire to punish Savoy and its partners for Mr. LaMarr’s political associations.
These matters are now on appeal, but in light of recent articles mentioning them, we felt it prudent to set the record straight to explain the case and its bases to the public. Thank you.
No comments:
Post a Comment