Complaint to the Public Integrity Bureau against the Seneca County Industrial Development Agency

 

The following is a copy of a complaint filed by Allison Stokes against the Seneca County IDA.

from Rev. Allison Stokes, Ph.D.

Seneca Falls

regarding issues relating to

the developer Thomas C. Wilmot’s financing of his proposed  gambling casino in Tyre

Wednesday, February 11th, 2015

 

 

Note:    To my knowledge, this is the only Tyre casino related complaint made against the Seneca County Industrial Development Agency. While other citizens from the County have taken legal action regarding the proposed Tyre casino, I am unaware of the particulars and of the status of pending litigation.  I have knowledge only of a discrimination complaint brought to the Civil Rights Bureau by Tyre resident Lynne Barbuto in October 2014 regarding the Amish. I sent documents to the CRB on 2.10.15 to support that complaint.  It is under review.

 

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My complaint against the Seneca County IDA has three components.  I am charging

1) violations of the agency’s stated transparency and accountability policies, and

2) the agency’s major, undisclosed conflict of interest in matters of legal counsel, and

3) the agency has acted in its own interest, not the public interest

 

1)  Violations of the IDA’s transparency and accountability policies

The Seneca County IDA (SENIDA) states on its website, “Because IDAs have a direct impact on everyone in the community, we operate in a completely open and transparent fashion.”  In practice, this is not the case.

The IDA scheduled a public hearing at the Tyre Fire House on Thursday, January 29th regarding developer Thomas Wilmot’s Application for Financial Assistance from the IDA for buying land and building a gambling casino in Tyre.

Prior to the hearing the IDA made available copies of the Wilmot application, and these were also available that night.  (See A. attached) This document is not signed, dated, or notarized. It includes glaring blanks, missing information. It clearly is not the document of record. When was the application made?  What blanks have been filled in?  I asked the IDA’s Executive Director to see the original.  My request was denied on Monday, 2/9/15.  I was told that in order to see Wilmot’s signed, dated, notarized application, one must submit a FOIL request. A citizen made this FOIL request later that day.

Many citizens were incensed when on October 2nd, 2014 the IDA board signed an “Inducement Agreement” with Tom Wilmot.  (See B. attached)  Why give an “inducement” to a wealthy developer determined to build a gambling casino in the Finger Lakes region despite considerable community opposition?  The IDA’s promotion of Wilmot’s interest over the taxpayers’ interest was blatant.

In November, at the request of Tyre Town Supervisor Ronald McGreevy, who champions the casino and is working closely with the wealthy developer’s attorney, the County Board of Supervisors formed a “Tax Payer Protection Committee.” It was to advise the IDA on its decision about giving Wilmot his requested financial assistance.  (See C. attached.) Many citizens laughed, calling this a case of the “fox watching the henhouse.” Even taxpayers who are in favor of the casino are furious that the IDA with its “inducement” benefits is clearly in favor of tax breaks for the wealthy developer.

The “taxpayer protection” review committee (made up of 3 county supervisors, and 3 IDA members) met eleven days after the public hearing—on Monday evening, February 9th. They were to discuss how to advise the IDA in its action on Tom Wilmot’s application for financial assistance. This meeting was not publicly announced.  It was a closed meeting.  “Tax Payer Protection”?  No accountability, no transparency, and Seneca County citizens who adamantly oppose taxpayers subsidizing Tom Wilmot’s plan were not represented. What was the result of Monday’s meeting?  We didn’t learn.

Today, Wednesday, February 11th I discovered a posting on the IDA website of Final Resolution 2015-9 (See D. attached) giving Wilmot the financial assistance he asks for.  The resolution is to be voted on tomorrow, February 12th.  It is abundantly clear that the IDA board is planning vote in Wilmot’s favor.  If they do, their decision will be made in violation of the agency’s pledge to transparency and accountability.  The signed, dated, notarized (presumably complete) Wilmot application was not accessible to the public at the IDA hearing on 1/29/15.  Twelved of the 17 speakers opposed the incentive package, and asked for missing information. (See E. attached, Finger Lakes Times news story) The deliberations of the “taxpayer protection committee” were not open to the public, and were not announced prior to the IDA board vote.

A word about the public hearing on January 29th, 2015—held just two weeks before the IDA board’s resolution in favor of Tom Wilmot was to be voted upon:

The one page Notice of the hearing— describing the financial assistance Wilmot was applying— for was so dense that it was extremely difficult to read or decipher.   For this reason I reformatted it to cover 2 pages, underlined key passages for explanation, and made 50 copies to distribute. (See F. attached) I assumed there would be a time for questions.  There wasn’t.  The Executive Director told me that was not the purpose of a hearing.  How can the public be expected to make informed comments, when the IDA is unwilling to answer questions about, or even discuss, the terms of the agreement that was the subject of the hearing?

This hearing was held during a snowstorm.  Although it concerned citizens of all of Seneca County, it was held at the Tyre Fire House (a distant location most people would be unfamiliar with) and not the more centrally located Seneca County building. Only one IDA board member was present to hear the citizens detail their opposition to giving a wealthy developer assistance in purchasing land, and tax breaks for a facility they oppose. For these reasons, and given the importance of the issue, I requested a second hearing. The “Taxpayer Protection” committee meeting considered my request.  Fayette County Supervisor Cindy Lorenzetti told me that although she argued for a second hearing, the other board members overruled her.  If a second hearing had been scheduled, the IDA would not have been able to proceed with a their vote on Wilmot’s application tomorrow. They have been in a hurry to get this passed, because as stated in the final Section 7 “These Resolutions shall take effect immediately.”

 

2)  Conflict of Interest—the Harris Beach connection

As mentioned above, the Seneca County IDA unanimously approved an Inducement Resolution on October 2nd, 2014 with the Lago Casino and Resort, LLC.  On February 12th, 2015 (tomorrow) the IDA is set to vote for the financial assistance the wealthy developer applied for.

Shawn Griffin, a Harris Beach attorney, is Mr. Wilmot’s attorney.  Griffin stood beside Wilmot at the Tyre Fire House on December 11th, 2013, when he rolled out his plan for a $350M gambling casino (later upgraded to $425M).  According to his bio on the Harris Beach website, Shawn Giffin “currently counsels approximately 26 IDAs throughout the state acting as transaction counsel and often acting as general counsel on IDA operation issues.” Griffin has a long history with the Seneca County IDA.  Years ago he served as the IDA counsel, and as President of the Seneca Knit Development Corporation, operating under the IDA.  (See G. attached document from 2002)

A Harris Beach attorney, Russell Gaenzle, serves on the Seneca County IDA staff, and has held this position for years.  To avoid any suggestion of conflict of interest, the IDA brought a second, “independent” attorney on staff in May 2014.  He is Ronald Halpin of the Halpin Firm.  According to the background information about this independent counsel from the firm’s website (See H. attached), Mr. Halpin began his legal career in 2001 with Harris Beach in Rochester.  In 2005 he relocated to Ithaca where he served as of-counsel to Harris beach until 2007.  In 2008 he was elected as a partner to Harris Beach.  And “In January 2009 Mr. Halpin left the firm to serve as counsel for one of his clients, a major upstate NY hotel developer.”  This is the person who is the independent counsel for the IDA—assuring there is no conflict of interest?

Rochester-based Harris Beach represents Rochester-based Thomas Wilmot. Harris Beach has a member on staff at the Seneca County IDA.  And the “independent counsel” for the IDA worked at Harris Beach from 2001-2007 and was a partner.

Supervisor Cindy Lorenzetti has told me that the Seneca County Board of Supervisors are suing Harris Beach for neglect. As the Finger Lakes Times reporter explains, “ The Rochester firm missed a crucial deadline involving the county’s hopes of having the U.S. Supreme Court hear an appeal in its tax foreclosure case against the Cayugas.” Harris Beach’s unexplainable, unconscionable lapse angered people who had been working the case for 20 to 30 years.  In November the Supervisors fired Harris Beach and they have now engaged a new firm from Syracuse.  The Supervisors strongly advised the IDA to do the same and break their ties with Harris Beach.  The agency has not. Why?

Both the Seneca County IDA and Harris Beach are advocating for Tom Wilmot and his gambling casino.  Leaders throughout the state have suggested that the decision of the Gaming Facility Location Board to designate Tyre as a gambling casino site was not economic, but political.  In that case, the Harris Beach connection surfaces again. State Senator Michael F. Nozzolio is long connected with Harris Beach and is on their roster as “Of Counsel.” Has he used his influence to promote Tom Wilmot’s project? to persuade the Gaming Commission’s site location board to choose Tyre? to convince the Seneca County IDA that giving “inducements” to this wealthy Rochester developer at the expense county taxpayers is actually in the public interest?

3)  Conflict of Interest– the IDA acting in its own interest and not in the public interest

While all nine board members of the IDA must sign yearly “Certification of No Conflict of Interest” forms, the agency itself has no oversight that I can determine regarding its own conflict of interest. 

In Resolution 2015-9 (section 1-f), the IDA states, “It is desirable and in the public interest for the Agency [the IDA] to acquire an interest in the Facility [the gambling casino].”

For a state agency to maintain that it is desirable and in the public interest for it to acquire an interest in a gambling casino is a highly contested claim. The IDA has received and ignored a flood of taxpayer testimony to the contrary—at public hearings, in written statements, through Finger Lakes Times letters to the editor and opinion pieces, etc. A doctor from Romulus emailed me, “There is no way the public wants the Wilmot group to receive tax breaks in building their casino! I wish we could have a public referendum on the issue.” Another taxpayer quips, “we are dealing with a rogue IDA.”

Many people have commented, and asked the IDA directly, about the undisclosed dollar amount of the agency’s fee for acquiring an interest in Tom Wilmot’s gambling casino.  Note: the undated, unsigned, unnotarized application for financial assistance indicates “The Agency will collect a * fee at the time of closing.  * To be negotiated.” 

This * has not been addressed.  I wonder. The IDA’s 2015 Budget lists Total Revenues and Financing Sources as $1,445.037 and Total Expenditures as $1,526,867.  The Excess (deficiency) of Revenues and capital contributions over expenditures is -$81,830. (See I. attached) Is IDA’s gain from their financial agreement with Tom Wilmot expected to help with the deficiency?

I appeal to the Attorney General’s Public Integrity Bureau to investigate the conduct of the Seneca County IDA with this Rochester developer.  The 9-member board and Executive Director serve with no term limits and act as if they have no public accountability here in Seneca County.

Will the office of the NY State Attorney General hold this state agency accountable for its violation of the public trust?  I truly hope so.

 

 

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