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Shine a light on Hempstead concession deals

Town must unravel questions hanging over contracts

Hempstead concessionaire Butch Yamali runs Malibu Beach Park.

Hempstead concessionaire Butch Yamali runs Malibu Beach Park. Photo Credit: Newsday / J. Conrad Williams Jr.

The operator of the Town of Hempstead’s Malibu Beach Park has not paid the rent for nearly a year and, according to town records, owes $531,400 for that concession. Despite that red flag, 10 weeks ago, town Comptroller Kevin Conroy and Parks Commissioner Daniel Lino signed a five-year extension on a 10-year contract approved by the town board in 2009 for Malibu with Dover Gourmet Corp. and its politically connected owner, Butch Yamali.

Now another red flag has gone up. The U.S. attorney for the Eastern District of New York has served the town with a subpoena for records, correspondence and documents related to Yamali for Malibu and his other Hempstead concessions.

Lino and Conroy signed the extension in April without even informing Democratic Town Supervisor Laura Gillen or seeking board approval. Worse, the new agreement the two officials approved in April includes material changes that benefit Yamali in the amount of rent paid, the terms under which the town provides lifeguards at Malibu, and the details for the parking concession. Clearly, that new deal should require a new vote. At Tuesday’s town board meeting, Gillen got support from GOP board members on a new rule requiring board approval for modifications, renewals or extensions of town contracts that change their value by $50,000 or more. But the board tabled Gillen’s measure to annul the Malibu extension and return to the terms of the original contract, which is a mistake.

Yamali told a Newsday reporter he doesn’t owe the $531,400 in rent because the town owes him more than $2 million for capital improvements he has made at the oceanfront park. He said Lino, Conroy and town attorney Joseph Ra told him not to pay until they come to terms on those costs. 

The three men are part of the town Republican power structure that often has thwarted Gillen and is eager to defeat her in November.

But the 2009 contract approved by the town board is quite clear on who will pay for every repair and improvement at the property: Dover Gourmet Corp. And Ra says he never talked to Yamali about rent. Conroy hasn’t commented. Dover was obligated in the original contract to spend $10 million to improve Malibu, and Lino has said if the company spent more, “those excess monies would offset the rental” and payments in lieu of taxes due on the concessions. However, that’s the exact opposite of the deal the town board approved.

The dispute is churning up a lot of political controversy during an election year between Gillen, who is seeking a second term, and the GOP establishment that has tried to undermine her from Day One. But that doesn’t explain why the Justice Department would be interested.

In Hempstead, Republican politics and town governance have been inseparable for a century. In this case, town and county GOP chairman Joseph Cairo was the attorney for Yamali on the 2009 contract, and Cairo’s son has worked for Yamali. The town needs to comply fully with the federal investigation, and the board ought to revisit and pass Gillen’s proposal to revert to the terms of the contract with Malibu that was approved by the town’s elected officials. — The editorial board

Editor's note: An earlier version of this piece listed Daniel Lino as Kevin Lino. It has been corrected.

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