Sunday, December 26, 2010

Galloway and the Mayor

Mayor Rick Scalera was elated at the Common Council meeting last Tuesday night, talking about Eric Galloway's "commitment to the waterfront" and his commitment to Hudson. Although some may not see Galloway's commitment to Hudson, as it's been manifested so far, as an especially good thing, Galloway seems to have become Scalera's go-to guy for various projects. So much so that it's easy to forget that things got off to a rocky start for them. 

In May 2003, Galloway drew Scalera's ire when he paid Phil Gellert $250,000 for a lot that the mayor wanted for the City, but they soon patched things up. A couple years later, there was talk of Galloway swapping the lot on the corner of Fourth and Columbia--the bone of contention that he'd snatched out from under the City's nose--for 427 and 429 Warren Street, so the City could build a new building there for the Police Department, City Court, and the Code Enforcement Office, now located at those addresses on Warren Street. That never happened, but in the past year or so, Galloway's willingness to part with the lot figured large in "Plan B," the mayor's alternative for relocating the Department of Social Services.

During the 2005 mayoral campaign--one of the rare campaigns in the last two decades when Scalera was not running--a fundraiser for Dan Grandinetti, believed to be Scalera's choice as successor, was held at Galloway's mansion in the stately homes block of Allen Street. In late October of that year, days before the election, Scalera, in what was seen by some to be an attempt to boost Grandinetti's chances, announced plans for more than 100 units of affordable housing. Eighty of those units were in the Crosswinds development, but the other 26 were to be created by renovating buildings "on Union Street, Warren Street, and South Second Street"--buildings owned by Eric Galloway. Five years later, Crosswinds exists, but three major apartment buildings owned by Galloway--202-204 Warren Street, 354-356 Union Street, and 501-505 Union--still stand vacant, and 34-36 South Second Street, which once provided five affordable apartments, is being renovated as a single-family home that promises to be affordable to a very few. 

In the late summer of 2006, during one of the rare periods when he was not in office, Scalera appeared at the Historic Preservation Commission meeting to use his influence to get them to approve in a timely manner Galloway's proposal for building new buildings and renovating the existing building at the corner of First and Union streets. The project got its C of A and was then fast-tracked through the Planning Commission and the Zoning Board of Appeals (the project required an area variance), but, after all that effort and special attention, the project never happened. Kevin Walker explained that, by the time they'd secured their approvals, they'd lost the contractor, but more than four years have now passed, and still nothing has happened. You have to wonder about Galloway's commitment to this project. (Aside: It is rumored that First Ward Alderman Geeta Cheddie is now lobbying for the demolition of the surviving building on the site.)  

Sometime during the 2006-2007 term, when Scalera was out of office, Galloway ended up owning the lot at the corner of Fifth and Warren. The lot, which the City, through HDC, had owned for several years, had more than one party interested in it at the time. Architect Peter Sweeny wanted the lot to build a hotel there and had entered into a prelimimary agreement to buy it. Then Galloway decided he wanted it. There was a legal contest, made interesting by the fact that Mark Greenberg, who typically represents Galloway, was representing Sweeny, and Jack Connor, the once and future city attorney who didn't have that position in those years because Scalera was out of office, was representing Galloway. The details of the case are not known, but Galloway ended up owning the property, which continues to stand vacant. 

Returning to the main theme, in October 2010, Galloway hosted a meet and greet for the mayor at his house on Allen Street. It's interesting to read the Gossips account of that event in light of recent events--in particular, Galloway's proposal to purchase the Dunn's warehouse building.

When someone allegedly has tens of millions of dollars at his disposal, it's hard not to turn to him for help with problems that can be solved with money. In 2006, during the Tracy administration, members of the Common Council sought Galloway's help to solve the problem of the Keegan houses on North Fifth Street. The City had acquired them by eminent domain but was obligated to pay the Keegans their appraised value, which, if memory serves, was $195,000. To get the funds needed to pay for the buildings and restore them, the aldermen that served on the short-lived Planning and Land Use Committee of the Common Council worked with Galloway and The Grant Writers to put together a proposal for Round I of the Restore NY Communities Initiative. The plan involved restoring the two existing houses to their appearance in the 1939 photograph above and building a third house--one of Galloway's signature faux Greek Revival houses--behind the corner house, facing Prospect Street. The proposal was a strong one, but, as Bill Roehr of The Grant Writers explained, grant awards that year were "political," and Hudson's proposal did not get funded.

Now, at the end of 2010, we have Scalera and Common Council President Don Moore turning to Galloway to jump-start commercial development on the waterfront. Although there were nothing but expressions of joy and delight at Tuesday's Common Council meeting, outside the context of City Hall, the wisdom and appropriateness of this move is being questioned. The concern most often expressed--that, given the number of properties owned by Galloway being warehoused in Hudson, Galloway could take ownership of the building and do nothing with it--seems to have been anticipated by Galloway. The proposed terms of purchase include these two stipulations:        
5. Escrow: The Purchase Agreement will contain a provision requiring the Purchaser to deposit $25,000 in an escrow account and to be paid to the Seller in the event the property is not developed within the time frame set below. 
6. Construction Completion: The Purchase Agreement will contain a provision allowing the property to revert to the Seller for an amount equal to the Purchase Price in the event renovation of the building is not completed within 24 months of Purchaser's receipt of all approvals and/or permits to proceed with construction work.
There are other questions being raised that are not answered in the proposed purchase agreement, namely:
  • Was the fact that the City was ready to sell the old Dunn's warehouse building generally known? Was anything done to solicit interest in the building from other potential buyers?
  • Were the results of the creosote remediation done at the site by Niagara Mohawk some years ago (this was the site of the Hudson Gasification Works) ever made public? Was it generally known that the Department of Environmental Conservation had approved the building for reuse?
  • Will any effort be made to identify a chef or restaurant interested in taking on such a large space before the work is undertaken?
  • What might Galloway want in exchange for "taking a risk" at the waterfront? Are we going to see the return of the Starboard Project proposed for the corner of Warren and Fifth?  

1 comment:

  1. Seems to me that there is a flaw in the wording of that proposed agreement-

    "The Purchase Agreement will contain a provision allowing the property to revert to the Seller for an amount equal to the Purchase Price in the event renovation of the building is not completed within 24 months of Purchaser's receipt of all approvals and/or permits to proceed with construction work."

    The way that reads, the developer could hold on to the property forever without doing any work. The 24-month clock doesn't start ticking until construction permits are in place, and there is no assurance that permits will even be applied for in a timely manner. The developer could wait 10 years before even submitting an application to the Planning Commission and other involved agencies.

    Perhaps there is some language in the full memorandum that I'm not aware of that addresses this issue, but it appears that the present wording is not adequate to insure that the project actually moves forward promptly.