FORT EDWARD — A draft management agreement between the new property owners of some of the former General Electric Co. dewatering site and the old property owners has been released through the Freedom of Information Law.
The document provided to The Post-Star was released after an approximately three-month Freedom of Information Law appeal process and appears to be the same draft agreement an anonymous source provided the paper last month.
While not signed, the draft agreement suggests once the property is developed and starts raking in money, executives of a well-known construction firm could see profits from the site even after the agreement has ended.
The Fort Edward Local Property Development Corp., a nonprofit, quasi-government entity formed at the end of last year, was gifted approximately 80 acres of the industrial park along the Old Champlain Canal.
WCC, the former owners, still owed more than $400,000 in taxes to Washington County when it gifted the parcels. The financial burden traveled with the gift.
In April, the LPDC held its first public meeting.
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Members include Fort Edward Town Board member Neal Orsini, Zachary Middleton, John Guglielmo and Darran Bush Thompson. Town Attorney Don Boyajian has also attended as “acting secretary.”
During that meeting, the LPDC passed a resolution to enter into a management agreement with a for-profit company called Fort Edward Development LLC.
Fort Edward Development LLC and WCC are both created by executives of D.A. Collins Construction of Wilton.
The Post-Star filed a Freedom of Information Law request for the agreement on May 2. The LPDC originally denied the request on the grounds that the agreement was a draft and unsigned.
The Post-Star appealed after getting an opinion from the state Committee on Open Government that the draft agreement was discussed so much in open session that it should have been provided to the public. For example, the LPDC revealed that the draft said the LLC would earn 50% of profits made on the site after insurance and taxes were paid.
Here is a glimpse of how difficult it can be to get public documents.
An unknown source provided a copy of the draft agreement to The Post-Star at the beginning of July.
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When shown the document, Orsini said he wasn’t sure if it was the latest draft, and added in a follow-up email that “(t)hat document has more information than even I have, as president of the corporation. It’s privileged communication that I am not privy to.”
The draft included equipment lease agreements between D.A. Collins Construction and Fort Edward Development LLC.
Robert Manz, chief operating officer of D.A. Collins, signed the lease on behalf of Fort Edward Development, while the controller of D.A. Collins signed for the construction company.
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At the LPDC’s second meeting on July 29, Middleton was appointed to be the group’s records access officer.
On Monday, Aug. 5, Middleton responded to The Post-Star‘s Freedom of Information Law appeal with the draft agreement, without the equipment leases attached.
Middleton wrote, “the Freedom of Information Law does not necessitate providing draft agreements,” and added that “there is no final or executed management agreement. The LDC was unable to reach agreed-upon terms to any potential agreement.”
The draft agreement, should it be signed, would make Fort Edward Development LLC the manager of the property. Any revenues made would first go to paying off insurance and taxes. Then, 50% of revenues would be split between the LLC and the LPDC.
While the draft says the agreement will last 20 years, a clause under the manager’s compensation states that the LLC would get 50% of the net sale proceeds from any sale at any time, “notwithstanding the expiration of the term of this agreement,” meaning the LLC would make money even if the agreement was ended.
Middleton also provided an interim agreement, which is signed and in place, between the LPDC and the LLC. Middleton wrote the agreement “provides the Fort Edward Development LLC with access to the property and requires them to maintain the costs of ongoing insurance coverages.”
The signed agreement does not stipulate how the property taxes will be paid.
At a Washington County supervisors meeting last week, several supervisors expressed anger that the taxes had not been paid and other towns were picking up the burden.
At the LPDC’s July 29 meeting, Orsini had said the taxes had not been paid yet, but he and others were working on marketing the site. It has been shown to multiple businesses so far, but the LPDC still needs to get sewer and natural gas to the site.