On July 3rd, Governor Cuomo announced that the state was giving the Town of Oyster Bay a $10 million Downtown Revitalization Initiative award that will help underwrite four transformative projects in downtown Hicksville. These projects are aimed at increasing transportation access, improving walkability, and attracting new housing opportunities. Here’s what is planned with the Revitalization Initiative money.

The Hicksville Station Access Improvements. These improvements will create a new entry drive for the Hicksville LIRR station lobby. This project will create and upgrade turning lanes, reconfigure medians, and install and upgrade traffic signals. The famous eagle statue will be relocated to a place of prominence in the median. It is expected to spiffy up the appearance of the area, improve station access for cars and pedestrians, relieve congestion along Route 106 and Newbridge Road and lengthen the rider drop-off area, which will include a new protective canopy. About $3.6 million of the award will be used for this project.

The Public Space at New Station Plaza. There will be new open public space north of the Hicksville LIRR station lobby. The plaza will allow for intermodal transfers, enhance pedestrian experience and provide much needed green space for residents. A new commercial corridor on West Barclay Street will be linked to the open space. Wider sidewalks that will improve pedestrian circulation will also be constructed. About $2.5 million of the award will be used for this project.

The Public Space at Festival Plaza. A new pedestrian passageway will be created along with public open space north of the LIRR Station to establish a safe and engaging walkway from the Hicksville LIRR station lobby to Jerusalem Avenue and nearby parking lots. Seasonal and temporary activities for commuters and residents will be available in the open space. About $2.5 million of the $10 million award will pay for this project.

New Housing & Retail at Hicksville Station. Underutilized property adjacent to the Hicksville LIRR station on Nelson Avenue will be redeveloped for mixed uses, including 3 buildings with 180 mixed-income residential units, and below grade parking. Street-level retail and restaurants along with a public plaza and green space will also be part of this project. About $1 million of the award will be used for this project.

Of course, $10 million will not be enough to complete these four transformative projects. So, where is the rest of the money expected to come from?  The Hicksville Downtown Revitalization Plan, developed by the Hicksville Planning Committee, appears to have the answer to this question. Some of the funding will come from the public sector aimed at expanding the open spaces. Private sector funding will come from developers aimed at the housing, retail, commercial and parking aspects of the projects.  In addition, the MTA is spending over $130 million to upgrade the Hicksville LIRR Station.  Big changes are coming to downtown Hicksville.

More information on the new downtown Hicksville is available on the Town of Oyster Bay website at http://oysterbaytown.com/hicksville-downtown-revitalization-initiative/

Several Long Island municipalities have local laws that peg the issuance of certain building permits to a requirement that contractors and subcontractors be participants in a “qualified apprenticeship program” that is registered and approved by the New York State Department of Labor. While these provisions are often entitled “safe and code compliant construction” and may be perceived as fostering apprenticeship programs for building construction trades, many contractors on Long Island disagree.

They see these provisions as having nothing to do with safety or compliance. They point out that many of these codes do not require that apprentices work on the project or that the selected contractor even employ such apprentices. Rather, all that is required is that the contractor have a collective bargaining agreement with a union that has a qualified apprenticeship program. They contend that these code provisions are aimed at ensuring that contractors affiliated with certain unions get the jobs by prohibiting non-unionized contractors or unionized contractors with affiliated unions that do not meet the qualified apprenticeship program requirement from getting building permits. And they further argue that these provisions add significant costs to the price of construction.

A recent decision by a federal judge may be changing that. But first, a sampling of codes provisions on Long Island that require qualified apprenticeship programs for building permits.

Town of Huntington

Section 87-55.1 of the Huntington Town Code provides that prior to the issuance of “building permits for the construction of commercial buildings of at least one hundred thousand (100,000) square feet,” applicants must “demonstrate that any general contractor, contractor or subcontractor for such project, must have apprenticeship agreements appropriate for the type and scope of work to be performed, which have been registered with, and approved by, the New York State Commissioner of Labor in accordance with Article 23 of the New York Labor Law.”

Town of Brookhaven

Section 16-3.1 of the Brookhaven Town Code requires that prior to the issuance of  “foundation permits and building permits for the construction of a building located in commercial and industrial zoning districts where the square footage of the footprint is 100,000 square feet or greater” and prior to the issuance of building permits for “an addition to an existing building located in commercial and industrial zoning districts when such addition is 100,000 square feet or greater,” that the applicant “demonstrate that any general contractor, contractor or subcontractor for such project participates in an approved apprenticeship training program(s) appropriate for the type and scope of work to be performed, that has been registered with, and approved by, the New York State Department of Labor in accordance with Article 23 of the New York Labor Law.”

Under Brookhaven’s code provision, unless an existing building has a certificate of occupancy or its equivalent, the square footage of the existing building is included in the calculation of the 100,000 square foot threshold.

Town of North Hempstead

Section 24-68 of the North Hempstead Town Code provides the following. “Every contractor or subcontractor who is a party to, or working under, a construction contract with the Town shall be a participant in good standing in a qualified apprenticeship program that is registered with and approved by the DOL and shall have in place apprenticeship agreements that specifically identify or pertain to the trade(s) and/or job title(s) called for within the construction contract.”

Section 2-9.1 of the North Hempstead Code requires that prior to issuance of a building permit for a “large commercial project,” the applicant must demonstrate that “any general contractor, contractor or subcontractor for such project is a participant in good standing in a qualified apprenticeship program that is registered with and approved by the DOL and has apprenticeship agreements, which are specifically identified as pertaining to the trade(s) and/or job title(s) called for by such project.”

A “large commercial project” is defined as “[t]he erection, construction, enlargement, alteration, removal, improvement, renovation, demolition or conversion of a commercial building or structure where such erection, construction, enlargement, alteration, removal, improvement, renovation, demolition or conversion involves an area of 100,000 square feet or more of floor area. The threshold of 100,000 square feet may be met either in a single building or a collection of buildings located on the same property.”

City of Long Beach

Section 7-48 of the City of Long Beach Code of Ordinances covers apprenticeship requirements. It provides that “as a condition precedent for, the issuance of all building permits…for construction of buildings of at least 100,000 square feet…any contractor or subcontractor, who is a party to, or working under, a construction contract, [must] be a participant in good standing of a qualified apprenticeship program that is registered with and approved by the New York State Department of Labor and to have apprenticeship agreements…which have been registered with, and approved by, the New York State Commissioner of Labor in accordance with Article 23 of the New York Labor Law.”

Town of Oyster Bay

Section 93-16.3 of the Town of Oyster Bay Town Code requires that any contractor or subcontractor who is performing construction on any “structures used for purposes other than private one- or two-family residences, and shall include, without limitation, buildings used for offices, retail or wholesale stores, warehouses, schools, and public buildings” shall “be a participant in good standing of a qualified apprenticeship program that is registered with and approved by the New York State Department of Labor and to have apprenticeship agreements, as evidenced by valid D.O.L. certificates of completion which are specifically identified as pertaining to the trade(s) and/or job title(s) necessary for said construction project.”

Sections 93-16.1 and 93-16.2 apply this provision to buildings of 100,000 square feet or more, and have other refinements to that 100,000 square foot threshold.

 Legal Challenge to Oyster Bay Provision

A legal challenge to Oyster Bay’s provisions is pending in the federal court in Central Islip. That case is entitled Hartcorn Plumbing and Heating, Inc. v Town of Oyster Bay.  Plaintiffs contend that Oyster Bay’s code is unconstitutional as it applies not just to contracts that the Town is a party to or funds, but also applies to wholly private contracts.

On February 7, 2018, Judge Hurley issued a preliminary injunction, enjoining the Town of Oyster Bay from enforcing Town Code 93-16.3, with respect to any contract that the Town of Oyster Bay is not a “direct or indirect party.” As a result, at least for now, projects that do not involve the Town of Oyster Bay as a party to the contract or are not funded by the town can get building permits without demonstrating that their contractors participate in “qualified apprenticeship programs.” Whether that ruling is ultimately upheld as the case proceeds is unknown, but it may result in other municipalities reexamining their code provisions voluntarily or as a result of similar court challenges.

How The Difference Adversely Impacted A Property Owner In A Condemnation ProceedingToday’s blog post concerns a property owner receiving substantially less than it wanted when its property was taken in an eminent domain proceeding because the “highest and best use” it claimed was applicable to the site required an area variance and a zoning change, rather than a special use permit. The awarded amount was about $1 million less than the property owner was seeking. The case, Matter of the Application of the Town of Oyster Bay v. BPJ Marine Corp., Supreme Court Nassau County, Index # 18701/2010, Justice Thomas A. Adams, December 3, 2013, affirmed, 139 AD3d 741 (2d Dept 2016) pitted BPJ Marine Corp., doing business as Gus Marine in Massapequa (the “Marina”) against the Town of Oyster Bay (the “Town”). It demonstrates the pitfalls facing an owner trying to establish the “highest and best use” of a parcel to maximize the condemnation award when the zoning prohibits the use.

The Marina

The Marina is located on a canal in Massapequa. It is composed of 2 parcels, divided by Alhambra Road. The eastern parcel is about 18,000 square feet in size. About 44% of that eastern parcel (7,900 square feet) is underwater. The eastern parcel has 180 feet of waterfront, all of which is bulk-headed except for a 10-foot boat ramp. The eastern parcel is about 75 feet wide, from the street line to the bulkhead. The western parcel is about 10,100 square feet and does not directly abut the water. Both parcels together are approximately 0.6 acres. The site is zoned as General Business (“GB”).

Prior to 2005, the Town permitted townhouse developments in GB zones as a special use. The site to the north of the Marina was developed as a townhouse complex 7 years before 2005, after obtaining a special use permit. In 2005, the Town enacted a local law prohibiting townhouses in GB zones. That 2005 local law was in effect at the time of vesting. Vesting is the point of time at which title to the land is deemed to be in the hands of the condemnor and no longer in the hands of the private owner. See New York State Eminent Domain Procedure Law (“EDPL”) § 402(B).

The Condemnation

The Town decided to condemn the Marina and made advance payments of $939,000 and $175,536.75 to the Marina. Not unexpectedly, the Marina claimed that the payments were woefully inadequate. The matter then proceeded to court.

The Marina claimed that the “highest and best use” of the site was as a townhouse condominium, asserting that 7 townhouses could be built at the site. The Marina asserted that the western parcel could be used for 2 of the 7 townhouses (with a value of $480,000) and the eastern parcel for 5 townhouses (with a value of $1,231,000.) Taking into account other factors, such as the cost to remediate the bulkhead and backfill it, the Marina claimed that the full value of the “highest and best use” award should have been $1,711,000.

The Town disagreed, asserting that the “highest and best use” of the site was as a marina and based its advance payments on that assessment. The Town presented evidence at trial that a townhouse complex had no reasonable probability of ever being approved for the site. The Marina would need to obtain a change of zone as it could not get a special use permit in light of the 2005 local law. Moreover, since the Marina was a conforming use in the GB zone, it could not take advantage of a Town code provision that allowed the Town to swap out a non-conforming use with a less intrusive non-conforming use.

The trial court and the Appellate Division agreed with the Town. The courts held that there was no reasonable probability that the Marina would get the site re-zoned to permit townhouses because of the express prohibition of townhouse construction in the GB zone in the 2005 local law. The courts noted that even if the zoning board of appeals overlooked that prohibition, the size of the area variance was massive and would not be granted. In making a determination to grant or deny an area variance, the zoning board of appeals would have to consider and balance the following factors: (1) will granting the area variance produce an undesirable change in the character of a neighborhood; (2) can the benefit sought by the applicant be achieved in some other feasible method; (3) is the requested relief substantial; (4) would the area variance, if granted, have an adverse effect or impact on the physical or environmental conditions of the neighborhood; and (5) is the condition requiring the area variance self-created.

The courts determined that the substantial size of the relief militated against the Marina. The courts noted that a townhouse complex under the zoning code needs a minimum of a 5-acre lot. The Marina was asking to build on a site that was less than 1 acre and a significant portion of the site was underwater land. The courts determined that the zoning board of appeals has never granted such an area variance of this magnitude. The courts also found that the problem was self-created because any developer that would submit a plan for seven townhouses on this undersized site couldn’t claim that it didn’t know how drastically undersized it was.

The trial court determined that the appropriate award was $35 per square foot, which amounted to about $732,000.

Although not mentioned in the decisions, since the award from the court was less than the advance payments made by the Town, under § 304(H) of the EDPL, the Marina may be subject to having to repay the amount that exceeds the advance payments. Not a happy ending for Gus Marine.