The ongoing legal conflict about the rezoning of land abutting the Manhasset Bay side of East Shore Road from industrial to a waterfront development district by the Village of Great Neck took another twist Tuesday night, Feb. 7. In light of the recent ruling against the village in the suit brought by Walbaum, Inc. (see GN Record, Jan. 27, 2006, "Nassau Supreme Court Rules Against Old Village," Page 1.), the mayor and trustees of the village voted unanimously to adopt legislation establishing a temporary moratorium on all building and other construction in the subject area to allow the board time to reconsider the "most beneficial zoning for that property for the village's future development." The board might decide to re-open the environmental review process (SEQRA), but also reserves the right to appeal the decision of the court.

At the public hearing that evening, all of the board members reiterated their firm belief that the rezoning of the area to allow for residential housing is not dependent on the sewage diversion project that is currently being studied in a grant from the state Department of Environmental Conservation (DEC). Essentially, the linkage between the two actions was a major argument used by Walbaum's attorneys in their lawsuit. Judge Stephen Bucaria in his ruling noted that former mayor Stephen Falk had been quoted in The New York Times saying that the diversion of sewage was the "linchpin" of the rezoning. Indeed, Mayor Falk did not equivocate in any public meetings regarding his opinion that the diversion project should go forward and that it was necessary for the up zoning of the area; however, the linkage was never adopted by the board as a whole and during the public hearing process, when diversion became a red flag itself, comments about diversion were not entertained.

One of Walbaum's attorneys, John Ward, spoke at the Feb. 7 meeting in opposition to the moratorium. It is his contention that his client has not been able to sell the property because of the actions of the village, the various moratoria issued and extended and the resulting rezoning itself. He stated that the site was only suitable for commercial development.

Interesting exchanges occurred between board members and Mr. Ward. Trustee Mark Birnbaum asked whether Walbaum had done anything to clean up what Mr. Ward had referred to as "significant contamination." Mr. Ward stated that his client was working with the DEC, "a lengthy process" and the degree of cleanup would depend on the ultimate usage of the property. It is a given that the degree of cleanup required for residential is more expensive and extensive than that required for commercial. In fact, at an earlier meeting, Walbaum's attorney, Michael Sahn had stated that it would cost A&P, Walbaum's parent company, approximately $3.5 million to clean the site to residential standards and $195,000 to clean it to commercial standards.

One bone of contention between the board and Walbaum representatives during the lengthy hearing process for rezoning was that the environmental soil studies that Walbaum had independently authorized were not submitted to the board. The request for those studies, the promises that they would be furnished and the lack of response from A&P went on for months. Even now, there is some confusion about the degree of contamination. Mayor Richard Deem stated that he had been in touch with a representative from the DEC recently and had learned that the "open spill" on the property was considered so minimal by the DEC that the case had been closed.

Village attorney Steven Limmer requested that Mr. Ward resubmit all the papers about contamination to the board.

Mr. Birnbaum questioned Mr. Ward about whether Walbaum had had a contract with Joseph Shapiro, president of Commander Oil, the largest landowner in the subject area. Mr. Ward stated that a contract had been in place, but that Mr. Shapiro had exercised his right to cancel. Mr. Birnbaum questioned why Walbaum, if so eager to sell the property, had not granted a short extension to Mr. Shapiro who had reported to the board that he had acquired last minute information about contamination of the site and needed some time to determine the cost of cleanup before proceeding to close the deal. Mr. Ward did not directly answer that question other than to say that he did not know what information about contamination that Mr. Shapiro could have been referring to since all reports had been filed with the DEC. He also said that Mr. Shapiro has not "picked up the phone" and that in the intervening months since the agreement fell through "no offer has been made to us again."

In a phone interview with Mr. Shapiro a few days after the Feb. 7 meeting, he told the Record that the deal with Walbaum fell apart on Nov. 17, 2005 and that he had tried numerous times to speak with various high-level administrators including the CEO at the parent company, A&P. He stated that despite his persistent calls, no one called him back. Mr. Shapiro was emphatic that he is still "ready, willing and able" to go forward with the purchase and that if A&P called, he would "pick up the phone on the first ring."

At the moratorium hearing, various residents addressed the board regarding the stymied situation on East Shore Road, which by the way does not affect the rezoning on the west side of the street.

Stuart Feingenblatt deplored the situation stating that the village had "no right to hold up Walbaums" and that the proceedings were going "nowhere."

Deputy Mayor Ralph Kreitzman differed by saying that Walbaum had effectively "held themselves up by their lawsuit." He also reminded the audience that the board had commissioned an economic feasibility study by the Weitzman Group during the hearing phase to make sure that the zoning outcome would give prospective developers a reasonable profit. He said, "We paid good money for that and the report basically said, 'If you build it, they will come.' We had two very credible developers with good track records who were very interested." The way the rezoning was structured, there were incentives if a developer could amass all the properties for development. Essentially, Walbaums became a hold-out and a stumbling block for the overall development of the area which came as a surprise because their representatives, who attended all the hearing meetings, never protested the rezoning until the eleventh hour when the trustees were ready to vote on the matter.

One of the developers that Mr. Kreitzman had referred to in his statement was Midtown Equities, a company with extensive experience in waterfront and brownfield development. The Record had interviewed the firm's president, Daniel Pfiffer during the period that they had shown an interest in the property and had asked him if he thought the sewage treatment plant was an obstacle to upscale development. We had reported at the time that Mr. Pfiffer had replied that with proper buffering and landscaping, he saw no problem with the sewage plant remaining.

Norman Rutta, who owns commercial space on East Shore Road rose to make the point that Walbaum had also made it very clear when the parcel first came on the market that they would not sell to a grocery store competitor. It is Mr. Rutta's belief that this restriction was also a factor in their inability to sell the property.

Leon Korobow supported the moratorium, but asked the board to "take the opportunity to cut loose from the diversion idea." Calling diversion a "millstone" around the neck of the village, he stated that he believed that diversion would ultimately prove to be too expensive anyway.

Trustee Mitch Beckerman stated that "I'm not as smart as everybody else to know what to do ... we are studying three different options and I for one, want to make an informed decision by looking at the facts."

Elizabeth Allen concurred with the board regarding their insistence that residential development and sewage treatment plants could co-exist. She stated that during the hearing process, she had met with officials at Nassau County who were very positive and excited about the proposed waterfront development. She said, "The industrial area is a blight and a disgrace. You were right to upzone it. Keep doing what you're doing."

Trustee Mark Birnbaum said, "I wish the Nassau County Assessors office thought that being near a sewage treatment plant devalued your property. I live very near the plant and many homes near me are assessed at over a million dollars."