Professional Documents
Culture Documents
Adjacent LLC (GAA) (together the Owners), submit this Memorandum of Law in
manner when it voted in favor of revoking the PILOT agreements with the Owners,
and the order to show cause seeking an order pursuant to CPLR 6301 and 7805
preliminarily enjoining and restraining respondent IDA from (i) terminating all
agreements related to Valley Stream Green Acres and Green Acres Adjacent, (ii)
implementing the revocation of the PILOT agreement and all related agreements
between the IDA and VSGA in accordance with the resolution dated April 27, 2017,
(iii) implementing the revocation of the PILOT agreement and all related
agreements between the IDA and GAA in accordance with the resolution dated
April 27, 2017, and for such other and further relief as this Court deems just,
PRELIMINARY STATEMENT
Solely in response to public and political pressure, the respondent IDA has
awarded to VSGA and GAA as inducement for the redevelopment of the rundown
Green Acres Mall and new development of the adjacent property after the Owners
invested over $120 million to comply with their obligations under the PILOT
agreements. The IDA must be stopped. The Owners seek a preliminary injunction
and temporary restraining order to maintain the status quo pending the resolution
The facts underlying this case were covered extensively in the local
newspapers. In 2014 and 2015, the IDA approved the award of tax-incentive PILOT
agreements to VSGA and GAA, respectively, for the renovation and development of
the Green Acres Mall and adjacent property. Pursuant to the PILOT agreements,
these properties were removed from the tax rolls and instead, the Owners were
exchange, the Owners committed to make drastic improvements to the Green Acres
Mall, one that would transfer the property from a run-down, high-crime area to a
destination shopping center with new expanded retail, outdoor shopping, and
The Owners fully satisfied all of their obligations to date pursuant to the
PILOTs, including making all required payments. Together, they spent in excess of
$120 million to renovate the Green Acres Mall and construct the Green Acres
Commons and created a first-class shopping center that attracted national, blue-
chip brands such as Amazon, BestBuy, Century 21, Dicks Sporting Goods, and
Home Goods to name a few. These retailers benefited from the tax savings of the
PILOTs that helped to keep their rental costs down and in keeping with market
conditions. Today, the Green Acres Mall and Green Acres Commons together is a
2
Now, the IDA is attempting to revoke the very benefits which made that
possible because residents in the Town of Hempstead, with support from certain
elected officials, have complained that their taxes have increased. To support its
action, the IDA Board claimed that the Owners misrepresented and failed to meet
the minimum job creation requirements. The pre-textual nature of this claim,
the IDAs own findings. Those agreements give GAA and VSGA until December 31,
2017, and December 31, 2018, respectively, to meet the minimum job requirements.
Thus, while the IDA claims that the Owners have not met the job requirements of
the PILOT agreements, the deadline for the Owners to meet those requirements has
not yet arrived. Moreover, in its 2016 Compliance Review, less than one month
before the purported revocation, the IDA concluded that the Owners were in full
There is simply no legal or factual basis to justify the IDAs revocation of the
PILOTs. The Owners are being cast as the scapegoat for what has become a
maintain the status quo while the parties litigate the legality of the IDAs conduct.
FACTS
A. VSGA and GAA Purchase the Green Acres Mall and Adjacent Property
In January 2013, VSGA acquired the Green Acres Mall, a regional shopping
center located in Valley Stream, New York. (See Verified Petition, annexed hereto
as Exhibit 1). At the time of the purchase, the Mall was not generally considered an
3
attractive destination for shoppers. It did not consist of competitive, high-end
vendors or the most updated facilities. In addition, the adjacent movie theatre,
Sunrise Multiplex Cinemas, popularly dubbed the Murderplex, was known more
for the crime occurring on site than its featured offerings. (See Newsday Article
dated January 22, 2015, annexed to the Verified Petition as Exhibit A). The
Murderplex was considered a threat to public safety and deemed a blight on the
community as well as the adjacent Green Acres Mall. VSGA sought to improve the
profile of the Mall by constructing a new faade and renovating and expanding the
retail portions with the goal of drawing popular brands and department stores to
revitalize and enhance visitor experience at the Mall. As part of that plan to
improve the overall offering of the Green Acres Mall, in April 2013, GAA (an
affiliate of VSGA) acquired 19-acres of land adjacent to Green Acres Mall, including
the Murderplex, with the plan of demolishing the cinema and replacing it with an
outdoor shopping destination that would bring even more retail attractions to the
community and Green Acres Mall. (See Verified Petition, Exhibit 1). This shopping
According to its website, the IDAs programs reflect the business-friendly policies of
4
(http://www.tohida.org/about/about_tohida (last visited June 22, 2017). Its
initiatives are designed to help businesses cut financing costs, taxes and red tape.
(Id.) Through financing incentives, the IDA offers to assist business in cutting the
costs of acquiring, equipping, and constructing projects. (Id.) In August 2014, the
Owners applied to the IDA for such benefits in connection with the redevelopment
of Green Acres Mall and the construction of Green Acres Commons.1 (See VSGA
After a duly noticed public hearing, on December 17, 2014, the IDA
unanimously approved the award of a PILOT agreement to VSGA for Green Acres
Mall. (See VSGA Notice of Public Hearing, Public Hearing Transcript, and
few months later, after a duly noticed public hearing, on April 22, 2015, the IDA
unanimously approved the award of another PILOT agreement to GAA for the
Green Acres Commons development.2 (See GAA Notice of Public Hearing, Public
Exhibit E).
1 Prior to these Applications with the IDA, the Owners commenced tax certiorari proceedings in
Nassau County, contesting the real estate tax assessments for both Green Acres Mall and Green
Acres Commons. These tax certiorari proceedings are still pending as of June 2017.
2 At the time of these awards, the IDA Board consisted of the following members: Theodore P. Sasso,
Jr. (Chairman); Ari Brown (Secretary); Jonathan P. Kohan (Treasurer); Dan Grodotzke (Member);
Richard Bianculli (Member); Raymond Maguire (Member); and, Ann DeMichael (Member).
Meanwhile, the IDA Staff consisted of Frederick E. Parola (Executive Director and Chief Executive
Officer) and Edie Longo (Deputy Executive Director and Chief Financial Officer).
5
PILOT agreements, which are shorthand for payments-in-lieu-of-taxes
ways that would benefit the local community by allowing those companies to pay a
fixed amount of property taxes. In the case of the PILOT agreements awarded to
VSGA and GAA, the Owners were able to invest a greater amount of money in the
renovation and construction of the Mall and Commons due to the certainty of
amount equal to the estimated amount of property taxes due after the successful
agreements, including PILOT, Recapture, and Lease agreements, with the IDA
GAA Lease Agreement, annexed to the Verified Petition as Exhibit K). These
Agreements set forth the amount of PILOT payments that each company is
required to make for their respective properties over the ensuing ten years (with
five-year options to extend). The amount of payments the Owners are required to
6
As part of the PILOT Agreements, the Owners were required to provide a
satisfy those requirements, VSGA was required to maintain at [Green Acres Mall]
employees as of December 31, 2018 (emphasis added), and GAA was required to to
maintain at the [Green Acres Commons] three hundred and fifty-five (355) full-time
equivalent employees as of December 31, 2017 and five hundred and seventy (570)
e.g. Exhibits H and K, 8.13). The Lease Agreements further required the Owners
to file annual statements with the New York State Department of Taxation and
Finance with the IDA setting forth its employment statistics. (See Exhibits H and
K, 8.6) The Owners are also required to provide the IDA with such information
necessary for the Agency to comply with Section 874(9) of the GML [and] to provide
and certify or cause to be provided and certified such information concerning the
necessary to enable the Agency to make any report required by law, governmental
regulation including, without limitation, any reports required by the Act or the
Public Authorities Accountability Act of 2005, or the Public Authorities Reform Act
of 2009, each as amended from time to time, or any of the Agency Documents or
Company Documents, or any other reports required by the New York State
Authority Budget Office or the Office of the State Comptroller. (See id. 8.6).
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There appears to be no other reporting requirement for the Owners either in
In the event that either of the Owners fails to comply with any provision of
the Agreements, including the reporting requirements, the IDA is required under
noncompliance and allow the Owners the opportunity to cure any such event of
By their terms, the PILOTs for both Owners went into effect on July 1, 2016.
Since this date, both Owners have timely tendered PILOT payments pursuant to
In reliance on the PILOTs, the Owners invested over $120 million in capital
Mall and the construction of Green Acres Commons. The Green Acres Mall
aging roof, purchasing new security equipment, replacing exterior and interior
lighting, enhancing elevators and escalators, and redesigning facades and mall
entrances to make the site more welcoming for shoppers. This work enabled the
Green Acres Mall to attract more upscale anchor tenants such as Century 21,
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As for Green Acres Commons, what was once an unwelcoming movie theater,
has now become home to over a dozen popular brands including Home Goods, Five
Below, Ashley Furniture Homestore, Burlington Coat Factory, Buffalo Wild Wings,
Together, the Green Acres Mall and Green Acres Commons offer over 150
stores and new or newly improved or renovated facilities to attract shoppers from a
far more diverse geographic area than before. These investments revitalized the
area and resulted in the creation of 20 new stores with the renovation and
conduct an economic and fiscal impact analysis (Camoin Report) of Green Acres
Mall and Green Acres Commons. (See IDA Resolution dated October 26, 2017,
November 14, 2016, and available on the IDAs website, concluded that the Green
Acres Project would contribute additional jobs, earnings, and sales in the Town of
Hempstead. (See Camoin Report, annexed to the Verified Petition as Exhibit M).
Authorities Reporting Information System, the Camoin Report found that the
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177 new direct construction jobs generating nearly $17.4 million in direct new
jobs. (See Exhibit M, page 4). The Report also found that there will be 1,003 new
jobs created in the Town following the completion of the Project, including the 820
net new on-site jobs, above and beyond what would have existed at the Green Acres
Mall and Commons if the Project did not occur. (See Exhibit M, page 5).
The IDA Board never contested the findings delineated in the Camoin
Report.
Despite the vast improvements to the Green Acres Mall and Commons, in
late 2016, after the Owners had invested over $120 million into the site, local
complaints, in November 2016, six of the seven IDA Board members who approved
the PILOT Agreements resigned from their positions and new members were
appointed to the Board.3 (See Newsday Article dated November 15, 2016, annexed
On January 19, 2017, the new IDA Board held an Informational Hearing to
gather testimony from the community and other interested parties to consider the
status of the Green Acres Mall and Commons project. (See IDA Notice for
3The new IDA Board consisted of the following members: Arthur Nastre (Chairman), William
Hendrick (Vice Chairman), Florestino Girardi (Treasurer), Eric Malette (Secretary), John Ferretti,
Jr. (Member), and Steven Raiser (Member). However, IDA staff members Frederick Parola and Edie
Longo have remained.
10
Informational Hearing, annexed to the Verified Petition as Exhibit O). Neither of
the Owners received any written notice of this hearing directed to them.
their provisions of FTE jobs, and the positive impacts of their redevelopment and
This testimony was neither contested nor disputed by the IDA at the
Hearing.
Following the hearing and in compliance with the Agreements, the Owners
provided the IDA with their respective 2016 data sheets for Green Acres Commons
and Green Acres Mall on January 26, 2017. (See GAA 2016 Data Sheet, annexed to
the Verified Petition as Exhibit Q; See VSGA 2016 Data Sheet, annexed to the
Verified Petition as Exhibit R). The Green Acres Commons data sheet for 2016
states that GAA created 622 FTE jobs in 2016, which included 248 FTE
construction jobs (see Exhibit Q), and the Green Acres Mall 2016 data sheet states
that VSGA had 2,616 FTE employees in 2016 (see Exhibit R). This is an increase of
over 300 jobs that did not exist at the time VSGA applied for the PILOT benefits.
(See Exhibit R). The Green Acres Mall Data Sheet goes on to clarify:
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** The original IDA PILOT agreement mall employee jobs
totaled 2774 and were not required to be calculated on the
basis of Full Time Equivalent (FTE). If they were, the
original agreements equivalent FTE count would be 2302
(assuming 1FTE equals 35 hours as legally defined). Using
the same methodology, the 2016 total mall employee FTE
is 2616.
information from the Owners. IDA staff sent a letter dated February 2, 2017, to
VSGA requesting certified payrolls for all occupants and tenants of Green Acres
Mall. (See IDA Staff Letter dated February 2, 2017, annexed to the Verified Petition
as Exhibit S). Later, on February 7, 2017, Steve Raiser, one of the new IDA Board
members, sent a request for certified payroll records for jobs created and retained
by the Green Acres project. This email permitted the Owners to provide such
certification in the form of an affidavit. (See IDA Board Member Email dated
February 7, 2017, annexed to the Verified Petition as Exhibit T). Neither of these
requests were authorized by the PILOT Agreements both because the Owners are
not required to satisfy the FTE job requirements until late 2017 and 2018, and the
Owners are not required to provide certified payroll records to the IDA unless
The Owners made good faith efforts to provide the IDA with as much
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address the IDAs employment concerns at the Green Acres Project. (See Revised
Data Sheets and affidavits, collectively attached to the Verified Petition as Exhibit
U). Indeed, the Owners corresponded with the IDA to alert the Board and staff that
there are only a total of seven tenants at the Mall with whom the Owners have the
ability to contractually request certified payroll records from based on the terms of
the Owners underlying lease agreements with their tenants. (See Owners letters
dated March 23, 2017 and March 28, 2017, annexed to the Verified Petition as
Exhibit V). Even with these contractual limitations in mind, the Owners still
Regardless, at no point in time did the Owners ever receive any written
notice, pursuant to their Agreements with the IDA or pursuant to the IDAs own
internal policies, that the Owners failed to comply with any FTE job requirements
meeting or hearing.
At its March 30, 2017 meeting, the IDA Board passed its 2016 compliance
review. (See IDA Agenda and Minutes dated March 30, 2017, annexed to the
Verified Petition as Exhibit W). This included the adoption of the 2016 Annual
Financial Report to the Office of the State Comptroller, prepared by IDA staff and
audited by Sheehan and Company in March 2017, and the 2016 Financial Report
dated March 20, 2017 and prepared by Sheehan and Company on behalf of the IDA.
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(See 2016 Annual Financial Report and 2016 Financial Report, collectively annexed
Both the 2016 Financial Report and the 2016 Compliance Review concluded
that the Owners were in full compliance with the terms of their PILOT agreements.
Indeed, the 2016 Financial Report incorporated the same employment information
provided by the Owners pursuant to their original and revised 2016 Data Sheets.
Specifically, the Financial Report states that GAA has an original estimate of 570
FTE employees, and 248 FTE construction jobs created during the fiscal year of
2016. (See Exhibit X, page 1). Additionally, the 2016 Annual Financial Report states
Green Acres Adjacent, PILOT will not begin until 2017. (See id.) As for Green
Acres Mall, the Report states that VSGA has 2,774 FTE employees at Green Acres
In contrast to the Owners and the Green Acres mall projects, at the March 30
meeting, the IDA Board terminated three unrelated PILOT agreements previously
awarded to LPF Realty, Gabrielli Inwood, and Openlink Financial for lack of
compliance. (See Exhibit W). Notably, prior to their termination, these three
by IDA staff.
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G. The IDA Improperly Revokes the PILOTs in
Response to Public Pressure
In April 2017, the IDA posted on its website an agenda for its monthly
meeting on April 27, which included the Decision of Board on Green Acres PILOT
Revocation. (See IDA Notice and Agenda for April 27, 2017 Meeting, annexed to
the Verified Petition as Exhibit Y). Although neither of the Owners received formal
written notice of the possible revocation of their PILOTs, both the Owners attended
At the meeting, the Decision was apparently already made. Neither of the
Owners were given an opportunity to speak before the IDA. Rather, the IDA Board
bowed to political pressure and revoked the PILOTs for both Green Acres Mall and
Green Acres Commons without any discussion, debate, or input from the Owners.
(See Transcript dated April 27, 2017, annexed to the Verified Petition as Exhibit Z).
Before conducting the vote, Board Chairman Arthur Nastre read the following
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of any of the employees, including construction workers has
been supplied. No proof has been submitted that the jobs
have been created or actually, no proof has been submitted
for jobs that have actually been created were actually in
the Town of Hempstead. The Board knows that the new
mall has far more than seven tenants and although
allegedly, [the Company] cannot contractually force them
to submit employment numbers, they could have at least
in a spirit of cooperation with the IDA asked their tenants
and their contractors to submit proof of the number of jobs
that they have created . . .
the terms of the PILOT Agreements as well as the IDAs own 2016 Annual
Financial Report and 2016 Compliance Review finding that the Owners were in
Following the April meeting, the IDA Board adopted resolutions revoking
both the Green Acres Mall and Green Acres Commons PILOT Agreements. (See
Exhibit AA; see IDA Resolution Revoking GAA Agreements, annexed to the Verified
Petition as Exhibit BB). The resolutions further highlight why the Boards action
revoking the PILOTs was arbitrary and capricious and not based on facts or
applicable law. In essence, the IDA Board demanded information it had no right to
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request and then determined that the Owners were in breach of the Agreements for
failing to comply to the Boards satisfaction even though the Owners had complied
with their contractual requirements as reflected in the 2016 data reports that were
part of the IDA Boards own records. Nonetheless, the IDA Board purportedly
revoked the PILOTs in order for the IDA Board to garner political favor with the
demanded that the IDA Board reconvene on an emergency basis, set aside the
action taken on April 27, 2017, and re-instate the PILOT Agreements. (See Owners
Letter dated May 1, 2017, annexed to the Verified Petition as Exhibit CC). Within
this letter, the Owners outlined the procedural and substantive deficiencies of the
IDAs revocation of the PILOTs. Specifically, the IDA Board (i) disregarded the
language of the underlying Agreements with the Owners, which do not require the
Owners to maintain a certain number of FTE jobs prior to December 31, 2017 and
December 31, 2018; (ii) failed to comply with the unambiguous, express terms of the
underlying Agreements by failing to provide the Owners with written notice of any
alleged default and a thirty day opportunity to cure; (iii) failed to comply with its
own internal policies by not providing the Owners with written notice of the April
27, 2017 hearing regarding revocation and by failing to provide the Owners with an
opportunity to proffer evidence in their defense; and, (iv) misrepresented that the
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The IDA never responded in writing to that letter, nor did the IDA take any
action to rescind its improper revocation of the Owners PILOT agreements. At all
times, the Owners continued to honor their Agreements with the IDA by making all
portion of the PILOT as recently as June 6, 2017. (See Owners Letter dated June 6,
In June 2017, the IDA Board set a special meeting for June 29, 2017 with a
Valley Stream Green Acres and Green Acres Adjacent. (See IDA Notice and
Agenda for June 29, 2017 Meeting, annexed to the Verified Petition as Exhibit EE).
The IDA appears to now be ready to terminate the PILOT Agreements based
upon the unlawful revocation action taken on April 27, 2017 and presumably seek
recapture of the PILOT benefits, which would irreparably harm the Owners by
risking the loss of tenants, stores, and jobs at the Green Acres properties through
Therefore, the Owners have no choice but to initiate the instant proceeding.
ARGUMENT
CPLR 7805 confers upon the Supreme Court the power to stay further
(McKinneys 2017); see also NY CPLR 6301 ( A temporary restraining order may be
immediate and irreparable injury, loss or damage will result unless the defendant is
18
restrained before the hearing can be had.); Id. 6313 ([i]f, on a motion, for a
preliminary injunction, the plaintiff shall show that immediate and irreparable
injury, loss or damage will result unless the defendant is restrained before a
hearing can be had, a temporary restraining order may be granted without notice.)
Yonkers Racing Corp. v. Catskill Regional Off-Track Betting Corp., 143 A.D.2d 345,
346 (2d Dept. 1988), recognized that a temporary restraining order is premised on
a demonstration that immediate and irreparably injury, loss or damage will result
unless the [other party] is restrained before the hearing can be held.
must demonstrate (i) that it will suffer irreparable injury, (ii) a likelihood of success
on the merits, and (iii) a balance of the equities tips in favor of granting the
injunction. See Melvin v. Union College, 195 A.D.2d 447, 448 (2d Dept. 1993); see
also Walsh v. Design Concepts, Ltd., 221 A.D.2d 454, 455 (2d Dept. 1995); Klein,
Wagner & Morris v. Lawrence A. Klein, P.C., 186 A.D.2d 631, 633 (2d Dept. 1992).
Here, the Owners would be irreparably harmed in two ways. First, the
revocation of the PILOTs would compromise the leases that the Owners have with
their tenants and subtenants. Second, the Owners would suffer damage to their
The Owners have written leases with all of their tenants, which leases are
approved by the IDA. Many of those leases are triple net, meaning that all tax
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liability is contractually passed to the tenants in the form of additional rent. The
rental obligations set forth in the leases entered into since 2015 between the
Owners and their tenants are calculated based upon the existence of the PILOT
agreements. The retail tenants agreed to long-term leases that brought jobs to the
area based upon their expectation that their rental obligations would be calculated
The cancellation of the Owners PILOT Agreements would thrust the Green
Acres Mall and Commons into economic chaos given the fundamentally altered
economic environment that would exist. Retail tenants could not compete with
other retail establishments in the area, such as Roosevelt Field, and create the
possibility of mass defaults on leases and store closures. If such were allowed to
occur, many of the jobs that have been created through the PILOTs would
potentially disappear. Failing to issue the TRO will likely create a self-fulfilling
prophecy that the Owners will not meet the goals of the PILOTs.
Thus, injunctive relief must be granted to prevent the Owners, and local
community, from suffering irreparable harm by losing the tenants, stores, and jobs
sought. See Destiny U.S.A. Holding, 69 A.D.3d 212 (4th Dept. 2009) (harm to
business reputation is harm for which money damages are insufficient and for
20
which injunctive relief may be appropriate); Konishi v. Lin, 88 A.D.2d 905 (2d Dept.
1982) (Plaintiff has established that if defendant is not enjoined from interfering
with plaintiffs use of the College Point office, he will suffer irreparable injury by the
loss of patients and damage to his reputation.) The revocation of the PILOTs
would severely damage the Owners business reputations and credibility with their
current and future tenants, which could not be prevented absent injunctive relief.
The Owners have entered into long-term relationships with their tenants.
The success of those relationships is built upon honesty and trust. Currently, the
Owners bill the tenants for their share of the tax payments as calculated under the
PILOTs. If those agreements are revoked now, the Owners would have to
immediately bill their tenants at much higher levels than over the past year. Doing
so would raise questions about the efficacy and integrity of the Owners ability to
properly manage their leases. With such a dark cloud hovering above the Green
Acres Mall and Green Acres Commons, new, high-quality tenants may be reluctant
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the action taken was without sound basis in reason or without regard to the
facts. Matter of Halperin v. City of New Rochelle, 24 A.D.3d 768, 770 (2d Dept.
2005). The April 27 resolutions were issued in utter disregard for the facts.
First, while the IDA accused the Owners of not complying with the FTE
requirements of the PILOT Agreements, the Owners did not need to meet those
requirements until December 31, 2017 and December 31, 2018. Pursuant to Section
8.13 of its Lease Agreement with the IDA, VSGA is not required to provide 2,774
FTE jobs at Green Acres Mall until December 31, 2018. (See Exhibit H, 8.13).
According to Section 8.13 of its Lease Agreement with the IDA, GAA is not required
to provide a total of 355 FTE jobs at Green Acres Commons until December 31,
2017, or to provide a total of 570 FTE jobs at Green Acres Commons until December
31, 2018. (See Exhibit K, 8.13). Because neither company is required to satisfy
the FTE job requirements under their respective Lease Agreements until December
31, 2017 or December 31, 2018, the Owners are not in violation of the FTE job
requirements.
Second, even if the Owners were required to meet the FTE requirements
prior to the issuance of the resolutions (which they were not) and actually failed to
meet them (which they did meet them), the IDA was required to first give the
Owners written notice of the default and provide the Owners an opportunity to cure
(just as the IDA did with LPF Realty, Gabrielli Inwood, and Openlink Financial).
22
Specifically, Section 11 of both PILOT Agreements explicitly states that the IDA
was required to notify the Company in writing of any failure by the Company to
comply with any provision of this PILOT Agreement and shall provide the Company
with the opportunity to cure such failure within thirty (30) days after receipt by the
Company of such notice. (See Exhibits F and I, 11). The failure to comply with
the FTE job requirements pursuant to the deadlines set forth in the Lease
both Owners in writing of any such failure and provide them with thirty days to
Here, it is beyond dispute that the IDA never provided any written notice of
Third, the IDA failed to comply with the notice requirements pursuant to its
own internal policy. The IDAs Recapture Policy expressly states that the IDAs
agreements or project documents entered into by the IDA and a project applicant.
(See IDA Recapture Policy, annexed to the Verified Petition as Exhibit FF).
determined by the Agency, in its sole discretion, on a case-by-case basis, and shall
be subject to the notice and cure periods provided for in the Project Documents.
23
The Recapture Policy requires that the termination of financial assistance be
subject to the notice and cure periods provided for in the project documents.
Because the PILOT Agreements specifically mandate that the IDA must provide the
Owners with written notice and an opportunity to cure any alleged defects, the IDA
lacked a rational basis in failing to provide the Owners with written notice of any
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III. A PRELIMINARY INJUNCTION WOULD MAINTAIN THE STATUS QUO
A balancing of the equities requires that the motion for injunctive relief be
than the harm caused to defendants through imposition of the injunction. See
Fischer v. Deitsch, 168 A.D.2d 599 (2d Dept. 1990); Nassau Roofing & Sheet Metal
Saunders, 285 N.Y 462, 474 (1941); Bachman v. Harrington, 184 N.Y. 458, 464
Here, the Owners are simply seeking to maintain the status quo i.e., all
injunction would merely require the IDA to continue with the previously approved
PILOT Agreements until a determination is made by this Court on whether the IDA
If an injunction were not issued and the properties were placed back on the
tax rolls, then presumably the Owners would have to pay higher tax amounts while
the Owners are successful in proving that the revocation of the PILOT Agreements
was arbitrary, capricious, and unlawful (as we anticipate), then the Owners would
PILOT Agreements. It is unlikely that the IDA would have the funds necessary to
reimburse the Owners, raising the possibility that a financing would be required. It
25