Judge allows tax-exemption bid for former LaSalle Military Academy to proceed

An India-based entity has won a preliminary court victory in a case that seeks to restore tax-exempt status to the former LaSalle Military Academy campus in Oakdale.

Amity University and its affiliated Crossborder Group in July 2022 filed suit in State Supreme Court against Islip Town seeking to restore the property’s former tax-exempt status as an educational institution. Islip has denied the status, citing Amity’s ties to for-profit entities and a dearth of educational operations or revenue.

Amity, which has been battling its tax status with Islip since at least 2019, says it plans to open a grades 6-12 boarding school on the property under an agreement with the Harrow School based in England. The property continues to host private events catered by the Lessing's firm, which operates there, but there didn't appear to be any school activities at the school during a recent Newsday visit.

Earlier this month, a state Supreme Court justice denied a motion by the town to dismiss the case, setting the stage for a potential trial. The town, which has appealed that ruling to a higher state court, didn't return a call seeking comment.

Suffolk County’s most recent “official statement of taxes in arrears” to Amity University amounted to $5.7 million, according to a copy of the tax statement obtained by Newsday. In January, Amity made a $674,106 tax payment "under protests," citing the continuing litigation.

Sean Cronin, an attorney for Amity, in a statement said the group has been "unlawfully taxed every year" since its purchase of the property in 2018. "Every action they [Amity] have taken has been consistent with their commitment to using the campus for educational purposes," he wrote. 

The Islip assessor, in denying the tax-exempt status, pointed to site visits and an investigation that found at least two for-profit entities, including Lessing's, were operating on the property and provided the biggest share of its revenue.

The town's motion to dismiss the case cited a 2019 exemption application that allegedly "acknowledged they [Amity] were not a school but claimed that their activities" would consist of "conducting public discussions groups, forums, panels, lectures or other similar programs."

In addition, the town noted, the revenue from for-profit entities, amounting to more than $1 million a year, went not to the nonprofit Amity CA, the named owner of the property, but instead to the for-profit Crossborder Group, whose owners also have ownership ties to global educational institutions and large industrial companies in India.

LaSalle shut down in 2001

LaSalle Military Academy closed in 2001 and for a time the campus was owned by St. John's University. 

Crossborder, which bought the property from St. John’s for $22.5 million in 2016, transferred ownership to affiliated nonprofit Amity CA in 2019 for $10, but maintains the rights to lease the property, Islip's court papers say.

“Since its purchase by Crossborder in 2016, no portion of the property has been used as a school for the granting of degrees or certificates,” the town’s motion to dismiss said.

The state Department of Education didn’t respond to questions about whether Amity was a state-recognized educational institution, or had applied to become one. Students do not appear to be at the campus now.

In addition to the Lessing’s revenue, more than $7 million in fees from an exchange program with Adelphi University that housed oversees students at the Oakdale campus went to Amity University, an affiliated entity based in India, and not Amity CA, Islip's papers note. As a result, they say, little is spent by Amity CA on programs or much-needed repairs at the campus.

The campus is home to the Bourne Mansion, once the sprawling estate of the Singer sewing machine magnate Frederick Bourne. The mansion, which “personifies luxury and grandeur and the elaborate celebrations of yesteryear,” according to Lessing’s, can host “lawn events” for more than 1,000 guests, plus weddings and “corporate affairs hosting 300 guests.”

Among the uses of the campus was a September 2023 “global business summit” with Suffolk County headlined by former County Executive Steve Bellone, who said at the time the county was “excited to partner with Amity Education Group” to host the summit that would “open new doors for our local businesses.” Bellone’s campaign finance filings show his campaign spent $12,627 for Lessing’s on the same day as the event.

In July 2022, three Suffolk County officials joined local business groups in a tour of India that included events hosted by Amity University. The trip included a 3½-hour drive to Agra, with a “visit to the Taj Mahal with Amity University as hosts.” A day later, it included a meeting with India’s minister of petroleum and natural gas & housing, and a tour of Amity’s New Delhi campus, referred to as the “sister campus in Islip NY.”

The county spent around $7,000 on travel expenses for two officials to attend, but a third county official, Mohinder Singh Taneja, then director of diversity outreach, did not file such a report, according a Newsday public records request. Former Suffolk County deputy county executive Jon Kaiman said he believed Taneja paid expenses himself; Taneja declined to discuss the matter.

Campus mostly vacant

Newsday visited the campus on April 8 and found the property largely uninhabited. Only a single building for Amity Education Group appeared to be actively occupied. Construction work by a demolition company appeared to be ongoing on St. Joseph Hall, a one-time student’s residence. A building situated on the bay across from St. Joseph's was in a state of severe disrepair.

Staff at the Amity Education Group office said the property was preparing to launch education programs for its licensing agreement with the Harrow School next year, but declined to comment on it. They referred questions to Savita Arora, a vice president of Crossborder Group, who did not respond to requests for comment.

In a September 2021 news release, Amity said Harrow New York “will be located in a stunning 170-acre campus in Oakdale on Long Island and will develop an innovative, bespoke curriculum to meet the needs of its students.” The school will be “operational” this September, the release states. Tuition for the boarding school grades 6-12 starts at $58,750, according to Harrow New York’s website, and goes as high as $71,500 for “full boarding.”

Cronin, Amity's attorney, said Amity has had "numerous educational programs on campus, including an International School program with students from around the world. They have also forged partnerships with local institutions such as Adelphi University and global institutions such as the Harrow School." 

Cronin said the campus is "in the process of a multimillion-dollar renovation to provide students with a setting that matches Amity’s stellar reputation worldwide. This ongoing commitment to education in conjunction with their financial investment in the property is for the betterment of Long Island and should be welcomed and embraced by the town."

State Supreme Court Judge John Leo, in an order in February, denied Islip’s motion to dismiss. Islip’s lawyers have appealed to the State Appellate Division.

Town says evidence doesn't support tax exemption

Islip Town, in court papers, argued that Amity failed to show that the nonprofit entity was conducting activity that would provide for its tax exemption. “Amity California merely leases the property to for-profit Crossborder, which in turn holds piecemeal space leases with a mixture of for-profit and not-for-profit entities from which Crossborder derives substantial income,” Islip wrote in its motion to dismiss.

Islip charged the Amity entities produced “rental” income of more than $8.7 million between 2016 and 2020, including more than $4 million for renting out Bourne Mansion to Lessing's during the period.

Islip determined the “most significant active use of the property was the use of the Bourne Mansion by the for-profit caterer, Lessing’s Inc, for various events throughout the year,” according to court papers.

But Leo, in his February order, noted that St. John’s, the former owner of the property, also leased the property to Lessing’s.

Leo ruled that since the court as of his February decision “cannot determine if the fees from leases are used for educational purposes" that the court "must accept [Amity’s] statements as to use of such fees as true.”

Leo found that another entity, Campus Camps, is a for-profit one that provides children’s camps, using up to six of the buildings.

Islip, Leo wrote, “cites the operation of the summer camp and a catering company to support their position that no exemption should be granted. However, this was never a question during St. John’s ownership. It is only now that [Islip] claims such operations defeat the exemption.”

Leo found “the flow of monies” between Crossborder and Amity “is not clear” but the “fact that it flows to any individual cannot be demonstrated” by Islip. Still, Leo noted, “it raises questions of fact. Since it cannot be demonstrated otherwise, at this point, the court must make the interference that no individual receives profits.”

While noting that Amity University’s articles of incorporation claim it’s a nonprofit public benefit corporation, “the fact that Amity University does not regard itself as a school and does not conduct any courses of instruction does not change the result,” Leo wrote.

Leo wrote that based on documents provided in the case alone, Amity Global “has an educational purpose,” but added that Crossborder’s revenue and the relation to education purpose of Amity Global and Amity University “needs analysis.”