Hello, Collar City! This is Issue 17, dated Jan. 11, 2018.



Good morning, all. In this issue: two city projects' increased projected costs, litigation involving a major Lansingburgh project, and a dispute involving a driveway owned by RPI. Let's begin...



Powers Park, Ingalls Ave Boat Launch Project Issues

Last night, the city council authorized a new bond issuance for one city project and tabled a vote on another.



Following an RFP reissuance "because of a specification discrepancy in the original document," as the planning commissioner told me for TL12, the lowest bid for the Powers Park rehabilitation—which includes "replacement of missing fence, general repair of existing fence, installation of stamped and colored sidewalks along 3rd Avenue and 110th Street, and interior earthwork to reestablish original major pathways using decomposed limestone," per a staff memo—came in at $598,250 from Carver Construction, far exceeding the previously allocated $476,500 for the project, nearly all of which comes from a state grant.

The administration asked the council to approve an additional $300,000 in bonding to cover the base bid along with other project costs (viewable in this agenda packet). But members of the council balked at that figure.



"I would suggest you take this back and work to get this on budget or, if need be, slightly above budget," said councilmember Mark McGrath. "As it stands right now, the park is a nice place. It serves its purpose." He said he'd like to see fencing all around the park but characterized other facets of the project, like sidewalks on the Third Avenue side, as superfluous.



"I'm not ready to say a hard 'no' on this, but it's too much to say, 'Yeah, definitely,'" councilmember Anasha Cummings said.



Deputy mayor Monica Kurzejeski eventually offered to "go back to the drawing board" to explore revising the project's scope, adding that the administration, like the council, was surprised at how high the bids were. The council voted unanimously to table the item.



The council approved the issuance of $250,000 in bonds for the Ingalls Avenue Boat Launch project. It had already, back in January 2017, approved $1,107,850 in bonds for the project. The increased costs relate to the discovery of additional buried concrete at the site and in-water work difficulties. More about the latter, from the staff memo:

An extremely wet Autumn caused working conditions on the Hudson River to be unsafe. Surge from additional water from northern locations created extremely high water levels in addition to uncharacteristic chop.



Additionally, bedrock under the river bottom sediment was found to be higher than anticipated in places providing insufficient support for the sheet piling. Buried debris undetected in the bathymetric survey, such as cars, complicated the matter. A new plan to use permanent sheeting for the concrete boat launch form was considered the most preferred plan of attack. This requires a change to the scope of work that adds 15 working days and an additional $64,650.25

Such as cars! Such is life, I guess.



Tyler Fane, a representative of the project's contractor, C.D. Perry, said last night that the project is about 75 percent complete.



Standard Manufacturing Building Litigation





In late November, the city planning commission



According to the lawsuit, which is dated Dec. 28, defendants David, Alison, and Christian "entered into a development Joint Venture Agreement" with another company that assumed 20 percent ownership of 750 Second Avenue Realty, LLC. As part of that deal, those three defendants secured the right for their business, TAG, LLC, to continue to use about 40,000 square feet of the building "rent free [for] 15-20 years."

The defendants have applied for more than $11 million in historic tax credits for the redevelopment project, but omitted Daren Arakelian's name "as a member/owner of the LLC on the application," according to the lawsuit. The defendants also allegedly met to discuss and vote on business of the LLC without notifying the plaintiff and, in various ways, violated the LLC's operating agreement.



The defendants also created "several separate and distinct LLCs...to act as developer, co-managing member of the tax credit partnerships, to facilitate tax abatements, to own and operate commercial space," and to own the subject property, the lawsuit says. The plaintiff "has repeatedly requested information regarding the formation of these LLCs, the membership interests of the LLCs, and an accounting of development costs incurred to date" but had not received a response by the time of the complaint's filing in state court.



The actions of the defendants diluted Daren Arakelian's equity interest in the LLC, according to the plaintiff. The lawsuit seeks judicial dissolution of the LLC, "an equitable accounting" of the LLC's books and records, and a multimillion-dollar judgment.



The complaint speaks for itself, an attorney for Daren Arakelian told me in an email. Christian Arakelian did not return messages seeking comment. I’ll keep an eye on this case as it unfolds.

Daren Arakelian, a purported member of 750 Second Avenue Realty, LLC, which owns the former Standard Manufacturing building in Lansingburgh, has sued that entity and three of its other members—David Arakelian, Alison Arakelian, and Christian Arakelian (each of whom, along with the plaintiff, holds a 25 percent interest in the LLC, per the lawsuit)—essentially alleging that he has been wrongly excluded from the property's redevelopment effort.In late November, the city planning commission approved plans to convert the massive warehouse's upper floors to apartments.According to the lawsuit, which is dated Dec. 28, defendants David, Alison, and Christian "entered into a development Joint Venture Agreement" with another company that assumed 20 percent ownership of 750 Second Avenue Realty, LLC. As part of that deal, those three defendants secured the right for their business, TAG, LLC, to continue to use about 40,000 square feet of the building "rent free [for] 15-20 years."The defendants have applied for more than $11 million in historic tax credits for the redevelopment project, but omitted Daren Arakelian's name "as a member/owner of the LLC on the application," according to the lawsuit. The defendants also allegedly met to discuss and vote on business of the LLC without notifying the plaintiff and, in various ways, violated the LLC's operating agreement.The defendants also created "several separate and distinct LLCs...to act as developer, co-managing member of the tax credit partnerships, to facilitate tax abatements, to own and operate commercial space," and to own the subject property, the lawsuit says. The plaintiff "has repeatedly requested information regarding the formation of these LLCs, the membership interests of the LLCs, and an accounting of development costs incurred to date" but had not received a response by the time of the complaint's filing in state court.The actions of the defendants diluted Daren Arakelian's equity interest in the LLC, according to the plaintiff. The lawsuit seeks judicial dissolution of the LLC, "an equitable accounting" of the LLC's books and records, and a multimillion-dollar judgment.The complaint speaks for itself, an attorney for Daren Arakelian told me in an email. Christian Arakelian did not return messages seeking comment. I’ll keep an eye on this case as it unfolds.

Open and Notorious



The case involves two adjacent properties—one owned by the Schuberts, the other by RPI—on Eaton Road near the school's campus. I'll try to outline the case briefly below, relying on and quoting from a Dec. 2017 state Supreme Court ruling in favor of RPI (which the Schuberts appealed to the appellate court—the reason for the appearance yesterday).



In February 2016, RPI sued the Schuberts in an attempt to establish that it holds a "



The defendants installed a "chain and stake boundary marker" along the property line in April 2016, which made "it difficult for people to exit or enter their vehicles without a car door hitting the chain fence," according to a tenant of the RPI property.



The defendants say that the marker hasn't prevented the tenant from using the driveway, that "there were never any issues with the driveway or individuals going on their property until Plaintiff and its tenants took ownership," and that RPI can't prove it holds a prescriptive easement, which requires evidence of 10-year, "open and notorious" use.



The state court's ruling in favor of RPI seems to have been largely influenced by affidavits from two nieces of the RPI property's previous (now deceased) owner, which the court said offered “clear and convincing evidence” of the prescriptive easement. (In contrast, yesterday at the appellate court, an attorney for the Schuberts characterized those two affidavits as speculative.) The lower court ordered the defendants to remove the marker and barred them (and their successors) from ever putting it up again.



It wasn't clear to me, from the oral arguments yesterday, which way the court will rule on the appeal. But I'll let you know when (and what, exactly) it decides. There are probably more consequential, Troy-related, pending legal matters in local/state/federal courts right now, but I find this case pretty interesting nonetheless!

More legal news: On Thursday afternoon, I watched the video livestream of oral arguments at the Appellate Division of the Supreme Court, Third Judicial Department between lawyers representing, on the one hand, Rensselaer Polytechnic Institute and, on the other, E. Fred Schubert, a professor at RPI, and his wife.The case involves two adjacent properties—one owned by the Schuberts, the other by RPI—on Eaton Road near the school's campus. I'll try to outline the case briefly below, relying on and quoting from a Dec. 2017 state Supreme Court ruling in favor of RPI (which the Schuberts appealed to the appellate court—the reason for the appearance yesterday).In February 2016, RPI sued the Schuberts in an attempt to establish that it holds a " prescriptive easement of a two foot area" on the Schuberts' property. The position of the RPI property's driveway means that people must cross the Schuberts' property to enter and exit their vehicles parked in the driveway, as they have done for decades, the plaintiff argued.The defendants installed a "chain and stake boundary marker" along the property line in April 2016, which made "it difficult for people to exit or enter their vehicles without a car door hitting the chain fence," according to a tenant of the RPI property.The defendants say that the marker hasn't prevented the tenant from using the driveway, that "there were never any issues with the driveway or individuals going on their property until Plaintiff and its tenants took ownership," and that RPI can't prove it holds a prescriptive easement, which requires evidence of 10-year, "open and notorious" use.The state court's ruling in favor of RPI seems to have been largely influenced by affidavits from two nieces of the RPI property's previous (now deceased) owner, which the court said offered “clear and convincing evidence” of the prescriptive easement. (In contrast, yesterday at the appellate court, an attorney for the Schuberts characterized those two affidavits as speculative.) The lower court ordered the defendants to remove the marker and barred them (and their successors) from ever putting it up again.It wasn't clear to me, from the oral arguments yesterday, which way the court will rule on the appeal. But I'll let you know when (and what, exactly) it decides. There are probably more consequential, Troy-related, pending legal matters in local/state/federal courts right now, but I find this case pretty interesting nonetheless!

Links

Events