Developer Kevin O'Neill at the construction site for the Northport Hotel,...

Developer Kevin O'Neill at the construction site for the Northport Hotel, which may open next Thanksgiving. Credit: Newsday/Alejandra Villa Loarca

Work has resumed on Northport’s namesake hotel in the village, with hopes for a Thanksgiving 2021 opening.

Developer Kevin O’Neill, owner with Richard Dolce of 225 Northport LLC, said construction work to build the 25-room, 24,677-square-foot boutique hotel resumed about six weeks ago.

"We’re making some progress, albeit our opening is delayed by a year because of the pandemic," O’Neill said. "But we’ll deal with it as we have to."

Like businesses across the state, O’Neill was forced to shut down because of the COVID-19 pandemic.

Despite the shutdown, there had been community enthusiasm that the much-talked about project was again moving forward. But a lawsuit over permit fees has cast a pall over the project. In August, the developers sued village trustees in Suffolk County Supreme Court in Riverhead over what they believe is a miscalculation in the building permit fee for the hotel. They are seeking $58,432, the difference between what they believe is the actual permit cost and what the village charged, said Huntington-based attorney Christopher Modelewski, who is representing the developers in the lawsuit.

Last winter, the developers paid $87,130 for a building permit to construct the hotel, which will have three floors, a basement and parking on the corner of Main Street and Woodside Avenue.

O’Neill said that based on calculations his architect used employing the village’s own fee schedule, the permit cost should have been $28,697.

On the village’s building permit application, O’Neill’s company put down $8.7 million, which is the total budgeted cost to build, equip and furnish the hotel and build two parking lots.

O’Neill said he thinks village officials calculated the building permit fee using the $8.7 million figure instead of what the village code says to use to calculate estimated cost. That amount is derived by calculating the square footage of the project based on each floor, with fees ranging from $85 to $105 per square foot; flat fees for items such as an elevator or antenna, which range from $500 to $100; parking fees that are $20 per square foot; and other miscellaneous fees.

Village Attorney Stuart Besen said the village is seeking to dismiss the case based on three points: The code was applied correctly and fairly using the information provided by O’Neill’s architect; the developers signed a separate agreement in November 2019 agreeing to reimburse the village for the cost of hiring an outside engineering consultant; and the developers did not exhaust administrative remedies before filing suit.

"How can he sue us," Besen said. "Mr. O’Neill signed an agreement; the project is just beginning, and we don’t know what the total cost to the village is going to be at this point."

Modelewski said that the village did not follow its own codified fee schedule and that the amount of the fee bears no relationship to the cost involved.

"We maintain that the motion to dismiss was a malicious delay tactic calculated to cause more economic harm to my client," Modelewski said.

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