Montauk crackdown leaves some businesses feeling economic pinch

East Hampton Town officials seem to have succeeded in their fight to take back Montauk’s streets from rowdy young summer visitors. But battles produce casualties, and the fallout from tougher code enforcement and crackdowns on excessive noise and overcrowding has resulted in economic losses for businesses, landlords and workers.

“There’s no question that there’s something happening,” said guitarist and Springs resident Alfredo Merat, who plays at the Sole East resort and the Shagwong restaurant and tavern in Montauk. “I think this year there were a lot more vacancies. Usually there’s not one room available.”

Jason Behan purchased the newly refurbished Shagwong on Main Street in Montauk a year ago. It’s a popular spot with the younger summer crowd and features dancing to DJs and live music.

“There’s been a little drop off,” Behan said of his business. “People want to listen to live music and that’s a big draw. . . . Outside music being off by 9, that’s a little early.”

Merat said the 20- and 30-somethings appear to have left or significantly diminished, but with consequences.

“The segment that used to come is coming less,” Merat said. “The ones with the bonfires that get cases of beer at 7-Eleven and wander off — those are gone. People are going to go where they can do whatever they want.”

John D’Agostino, an associate real estate broker at Martha Greene Real Estate in Montauk, thinks they’re going to New Jersey.

“They might have gone to another location more receptive to the way they want to vacation,” D’Agostino said, adding that the Jersey Shore seems to have finally recovered from superstorm Sandy in 2012. “The Jersey Shore is probably back up and running. There are just other places to go.”

Town’s crackdown

The noise crackdown is one of many measures East Hampton Town officials adopted and have begun strictly enforcing in the past year as part of efforts to curb the hamlet’s party atmosphere. They also include overcrowding and parking restrictions, a new rental registry aimed at preventing overcrowding and improving safety at share houses, closely monitoring the number of patrons at bars and restaurants, and new taxi licensing requirements.

While officials and others said they are proud of what has been accomplished quickly to restore residents’ quality of life, they acknowledge a downturn in some business and summer rentals, and the loss of part of Montauk’s character, such as strolls on balmy nights to the sounds of live music emanating from restaurants and bars.

“I think the steps the town took were effective in improving the quality of life in Montauk overall,” Supervisor Larry Cantwell said. “We saw that in less noise complaints, less quality-of-life complaints and in the hundreds of comments we’ve gotten from the public.”

Southampton Town Supervisor Jay Schneiderman, who owns The Breakers Motel in Montauk with his sister, Helen Ficalora, said the policies need some softening and that the challenge now is striking the right balance.

“In an effort to rein things in, the town may have taken things too far,” Schneiderman said. “ . . . Things that are really not a problem got hit by some of the changes, like the restaurants that weren’t disturbing anyone.”

Montauk is known for its live outdoor music, but new restrictions prevent it from being played past 9 p.m. The stricter enforcement has meant less summer work for local musicians, Merat said.

“They’re doing less bookings or doing duets or solos instead of bands that require the outdoors and crowds,” he said.

Montauk Chamber of Commerce president Paul Monte said businesses have had mixed success this summer, but it’s too soon to assess the season.

“I would say overall it was a good summer, not a great summer,” Monte said.

Landlords’ blues

Entertainment was not the only area feeling the blues. Realtors and landlords reported problems filling up rentals during the first summer that East Hampton’s controversial rental registry was in effect.

Kim Fagerland, a real estate broker and manager of Douglas Elliman’s Montauk office, said summer rentals in the hamlet decreased compared to last year.

“They’re definitely down in Montauk — about 30 percent over last year,” Fagerland said. “It’s quiet in East Hampton, too.”

She pointed to the rental registry law that requires absentee landlords to register their rental properties with the town and provide the number of tenants and bedrooms, and the term of the rental.

Landlords are also given a safety checklist for carbon monoxide detectors, smoke alarms and other items, and a rental registry number for each property helps officials keep track of the rentals in ads. Violators face fines from $3,000 to $15,000, and up to six months in jail or both.

“A lot of people thought the rental registry would be overturned and they didn’t want to go through the process,” Fagerland said. “They thought it was an invasion of privacy and more about the money grab.”

Cantwell has said that an estimated 6,000 properties are offered for rent each year in East Hampton, but that only about 3,000 landlords signed up for the registry.

Fagerland said summer rentals in Montauk normally range from $2,500 to $10,000 a week for a house with a pool, and that many locals had come to rely on the income to pay for taxes or property upkeep.

Lynne Scanlon, who has rented her East Hampton house for the past six summers, said she only had one call this year from possible tenants.

“Because of the rental registry, I had to turn down six women friends from New Jersey,” she said. “According to the registry you can have 10 bedrooms, but no more than four unrelated guests.”

Scanlon said she has counted on summer rental income to pay the taxes and insurance on her home and said she would have made $4,800 from the group of friends, who planned to stay for seven days.

There’s a domino effect on other businesses, Scanlon said.

“I haven’t had the cleaning lady come in once a week — I’m doing it,” Scanlon said. “And I don’t have the landscaper coming in; I’m doing that, too. And all of my projects with my carpenter are on hold.”

Commercial landlords like Schneiderman also said business has been hard to come by.

“It’s really flat,” Schneiderman said of business at The Breakers, which has 25 rooms. “I think it’s about the same as last year. And we’re oceanfront, so it’s easier to sell rooms.”

Despite some fallout from the crackdown, Behan and others said town officials are to be commended for restoring control in Montauk.

Cantwell said the town is open to changes where needed.

“We have strong policies, but we’re adaptable,” Cantwell said of the town board. “I think the town did what was needed and supported by the community as a whole, but the process of managing a community never ends and it changes.”