Five members of the Glen Cove City Council are questioning whether RXR Glen Isle Partners is in default for failing to file certain certifications on time and if the city will seek to recapture the hundreds of millions of dollars in tax breaks it gave the developer for its $1 billion waterfront development.
In a letter sent to Glen Cove Mayor Timothy Tenke on Thursday, the council members called on the IDA to determine if RXR failed to submit “required certifications” detailing the number of jobs the project would create.
The 2016 agreement, in which the IDA approved the tax breaks, requires RXR to annually submit the documents in accordance with New York General Municipal Law. According to the letter, the certifications for 2016, 2017 and 2018 were filed this year in late January and early February — making the 2016 form two years delinquent and the 2017 form a year past due.
Glen Cove Mayor Timothy Tenke, the chair of the IDA, said Thursday that RXR was “technically in default.” But the IDA didn’t issue a default letter because RXR timely provided the employment information but on the wrong form and corrected the oversight once RXR was notified. He said the city will not seek to recapture the subsidies.
“As an aside, even if there was a technical default, or even Event of Default, it is far from clear whether a judge would allow the IDA to recapture the financial assistance granted based on such a non-substantive issue,” Tenke wrote in a letter that was sent to council members Thursday and given to Newsday by a council member.
Joe Graziose, RXR executive vice president of residential development and construction, said the company is in “full compliance with all the documentation and agreements with the city and the IDA.”
The issue was flagged by a resident, Flip Pidot, who spoke at a Feb. 12 city council meeting. Pidot submitted a Freedom of Information Law request in January to obtain the employment documents and put in an additional request for email correspondence between RXR and the IDA.
In a Jan. 24 email, which Pidot provided to Newsday, IDA attorney Milan Tyler wrote to Peter Curry, an attorney for RXR: “If we don’t have these Exhibits for the FOIL response, we will need to send a default notice shortly.”
Tyler wrote in a Jan. 30 email to Curry: “I have now been instructed to draft a default letter,” according to emails provided by Pidot. RXR submitted the forms for 2016 that same day and the 2017 and 2018 forms on Feb. 1.
Tenke said Thursday he wasn’t aware of the emails and they were likely sent to give RXR an opportunity to “cure” the default before a letter was issued.
“I think the IDA has an obligation to look into it,” said Councilman Joe Capobianco, who signed the letter. “I think we need to hold RXR’s feet to the fire here and we need to make sure that they follow through with what they’re supposed to do.”
Tenke, a Democrat, accused the five council members — who comprise the council’s Republican majority — of pulling a political stunt ahead of the November election.
“We need to work together as partners, and this type of behavior does not help the residents, it does not help the city, does not help RXR,” Tenke said. “It smells political.”
The only council member not included on the letter was Democrat Marsha Silverman.
Silverman said she would have signed the letter had she known about it.
“I support asking the question and investigating and looking into it," Silverman said.