TOWN OF BROOKHAVEN - Brookhaven IDA

TOWN OF BROOKHAVEN 

INDUSTRIAL DEVELOPMENT AGENCY 

MEETING MINUTES 

JANUARY 11, 2012 

MEMBERS PRESENT: 

EXCUSED MEMBER: 

ALSO PRESENT: 

Frederick C. Braun, III, Chairman 

Gasper C. Celauro 

John Rose 

Ann-Marie Scheidt 

Ronald J. LaVita 

Joseph R. Kessel, Jr. 

Peter G. Moloney 

Lisa M. G. Mulligan, Chief Executive Officer 

Annette Eaderesto, IDA Counsel 

William Weir, Nixon Peabody (via conference call) 

Jocelyn Brinka, IDA Assistant 

Chairman Braun called the meeting to order at 8:00 A.M. on Wednesday, January 11, 2012, in 

the Economic Development Conference Room on the Second Floor at Brookhaven Town Hall, 

One Independence Hill, Farmingville, New York. 

MEETING MINUTES OF NOVEMBER 21, 2011 

The Minutes of November 21, 2011 had previously been sent to the Members for review. The 

motion to approve these Minutes as presented was made by Mr. Rose, seconded by Mr. LaVita 

and unanimously approved. 

MEETING MINUTES OF DECEMBER 5, 2011 

The Minutes of December 5, 2011 had also been sent to the Members for review prior to the 

meeting. The motion to approve these Minutes as presented was made by Ms. Scheidt and 

seconded by Mr. Rose. All were in favor. 

CFO’S REPORT 

Mr. Ryan was unable to attend the meeting due to other obligations. In his absence the 

November and December reports were presented by Mr. Braun. Mr. Braun noted that the IDA 

closed 2011 in the black. Ms. Mulligan added that Drive Train has still not paid the second half 

of their 2010-2011 PILOT. 

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The motion to accept the Operating Statement for November was made by Ms. Scheidt, 

seconded by Mr. Celauro and unanimously approved. 

The motion to accept the Operating Statement for December was made by Ms. Scheidt and 

seconded by Mr. Rose. All were in favor. 

Suffolk County National Bank (SCNB) 

Mr. Braun informed the Board that Suffolk County National Bank (SCNB) has brought in a new 

CEO with extensive experience, and a new CFO is expected to be announced next month. It 

appears that they are back on the right track. 

Emma S. Clark Memorial Library 

Mr. Braun recently received a phone call from the Attorney General’s Office in connection with 

this project. This was a project the IDA closed on a number of years ago. Mr. Braun explained 

that when money is first raised through the bond offering for a project it sits until construction 

starts, sometimes with a trustee, sometimes without one. Apparently the money was invested in 

a reverse repo. The Attorney General was involved in a class action suit with Bank of America 

for various derivatives. The IDA will be receiving $1,896 as a result of this which will then be 

passed back to the library. 

Long Island Angel Network (LIAN) – Sponsorship Request 

Ms. Scheidt informed the Board that the next investor meeting will be held on January 18 th at 

RXR Executive Park in Melville. Five entrepreneurs seeking financing will be making 

presentations and there will be eight companies with exhibit tables. Ms. Scheidt provided details 

on one of the entrepreneurs, a social media technology company that has developed a way to 

attach an audio file to a Facebook posting or Twitter feed. Celebrities will be contracted to 

provide personal messages. The LIAN is requesting a $5,000 sponsorship from the IDA. She 

explained that Long Islanders take early stage risk in this organization in the hopes to build and 

grow their company on Long Island. Mr. Braun suggested tabling this request until more defined 

parameters about sponsorships are set by the Authority Budget Office. Contracts are now 

necessary for these types of requests. Mr. Braun made it clear that the IDA is not making 

venture capital investments, merely supporting the organization. Ms. Scheidt will provide more 

information on LIAN and the DARE program to the Board as well as IDA Counsel. These are 

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organizations that provide services to encourage business which is in line with the IDA mission 

statement. 

International Economic Development Council (IEDC) – Membership Renewal 

Ms. Mulligan informed the Board that the IDA’s membership with the International Economic 

Development Council (IEDC) is due for renewal. The cost to renew is $765.00. Ms. Mulligan 

frequently uses the IEDC website for access to reports and has participated in many of their 

online seminars. 

At 8:13 A.M. Supervisor Lesko and Deputy Supervisor Walsh joined the meeting. At this time 

the Board voted to go into executive session to discuss matters of personnel. The motion to go 

into executive session was made by Mr. Rose and seconded by Mr. LaVita. All were in favor. 

Mr. Kessel joined the meeting while in executive session. 

At 9:15 A.M. Mr. LaVita made a motion to leave executive session and return to the regular 

meeting. This motion was seconded by Mr. Rose and unanimously approved. Mr. Lesko and 

Ms. Walsh then excused themselves from the meeting. 

The Board moved on to organizational resolutions for the year 2012. All personnel resolutions 

will expire on January 31, 2013. 

Organizational Resolutions 

Resolution #1 – Appointment of Lisa M. G. Mulligan as Chief Executive Officer 

Motion made by: Mr. LaVita 

Seconded by: Ms. Scheidt 

Unanimously approved 

Resolution #4 – Appointment of Jocelyn Brinka as Administrative Assistant 




Resolution #2 – Appointment of Annette Eaderesto as Legal Counsel 

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Resolution #23 – Appointment of Yves R. Michel as Deputy Executive Director 

Motion made by: Ms. Scheidt 

Seconded by: Mr. Celauro 


Resolution #24 – Appointment of James M. Tullo as Deputy Executive Director 

Motion made by: Mr. Rose 



Resolution #3 – Appointment of James Ryan as Chief Financial Officer 




The Board paused in the organizational resolutions to discuss a matter involving Motorola. 

Motorola 

Mr. Braun informed the Board that Motorola failed to pay a sewer tax and Suffolk County has 

now taken title to the property which was in the IDA’s name. Mr. Ryan is in the process of 

getting the deed back in the IDA’s name. 

Organization Resolutions (continued) 

Resolution #5 – Delegating and Authorizing Lisa M.G. Mulligan the Authority to Execute 

Various Documents for the Industrial Development Agency 


Seconded by: Mr. Rose 


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Resolution #6 – Appointment of Albanese, Sini & Reeves, LLP for auditing and financial 

reporting services in an amount not to exceed $14,500.00 




Resolution #7 – Appointment of Industrial Coverage Corporation as Insurance Broker 




Resolution #8 – Approving the Slate of Officers for the IDA 

Chairperson: Frederick C. Braun, III 

Vice-Chairperson: Ann-Marie Scheidt 

Treasurer: Joseph R. Kessel, Jr. 

Assistant Treasurer: Peter G. Moloney 

Secretary: Ronald J. LaVita 

Assistant Secretary: John Rose 

Member: 


Motion made by: Mr. Celauro 



Resolution #9 – Establishment of Governance Committee 


John Rose 


Frederick C. Braun, Ex-Officio 


Seconded by: Mr. Kessel 


Resolution #10 – Establishment of Audit Committee 

John Rose 

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Peter G. Moloney 





Resolution #11 – Authorizing Rental Agreement with Town of Brookhaven at a rate of $1,500 

per month. 




Resolution #12 – Hourly Workday Requirement for Industrial Development Agency Employees 

to be six (6) hours 




Resolution #13 – Adoption of Meeting Schedule for 2012 




Resolution #14 – Appointment of Applied Computer Technologies, LLC as Computer 

Consultant at a rate of $75.00 per hour not to exceed $5,000 per year for website upkeep 


Seconded by: Mr. LaVita 


Resolution #15 – Authorizing the Chairman, Treasurer, Chief Financial Officer and the Chief 

Executive Officer to establish and maintain accounts at Suffolk County National Bank 



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Resolution #16 – Amending Resolution #1 – Clarification of Working Hours for CEO 




Resolution #17 – Amending Resolution #3 – Clarification of Working Hours for CFO 




Resolution #18 – Adopting a Mission Statement and Measurement Report 




Resolution #19 – Adopting the Town of Brookhaven Ethics Policy, Procurement Policy and 

Property Acquisition and Disposal Policy 




Resolution #20 – Adopting Governance, Audit and Finance Committee Charters 




Resolution #21 – Re-Adopting the Existing Uniform Tax Exemption Policy 




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Mr. Braun, Ms. Mulligan and Mr. Weir have been working on amendments to this policy. A 

revised version will be presented at the February meeting for review. 

Resolution #22 – Adopting a Compensation Policy 




Formal appraisals of the performance of Agency employees will be completed later in the year. 

Resolution #23 – Adopting a Policy Concerning Board Member and Employee Loans 

Motion made by: Mr. Kessel 



Resolution #24 – Adopting a Prevailing Wage Policy 



Voting No: Mr. Celauro and Mr. Kessel 

Motion passes 

The existing policy was re-adopted; an amended policy will be discussed and voted on at the 

next meeting. 

Resolution #25 – Adopting a Whistleblower Policy and Investment Policy 




Resolution #26 – Adopting a Finance Committee 

Joseph R. Kessel, Jr. 





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Resolution #27 – Adopting an Existing Building Benefit Policy 




International Economic Development Council (IEDC) Membership Renewal – Revisited 

The motion to approve the membership renewal at a cost of $765.00 was made by Mr. Celauro 

and seconded by Ms. Scheidt. All were in favor. 

Framerica 

Mr. Braun updated the members on the status of Framerica’s request for an extension of their 

benefits. Framerica has received an offer on their building on Waverly Avenue which has not 

yet been accepted, and they have lowered the asking price on their Todd Court facility to $8.7 

million. A decision about their application to ReCharge NY is pending. Ms. Scheidt added that 

decisions on those applications should be announced next month. Mr. Braun and Ms. Mulligan 

recommended extending Framerica’s 100% property tax abatement for five more years and then 

ratchet it up or down by 20% a year for the next five years. It was noted that Framerica has 

upheld their job projections. If the building went to full assessment the tax would be roughly 

$170,000 plus land taxes. If this extension were to be approved clawback provisions would be 

put in place in an amended PILOT Agreement. As an example, if they moved in the next three 

years, the IDA would have a right to clawback and get the fully assessed tax back. One 

suggestion of how to accomplish this is withholding transfer of the title back to Framerica until 

debts were paid. Litigation is another possibility. Mr. Braun spoke with one of the principals of 

Framerica regarding the potential Home Depot contract and the effect a move would have on 

that. If they get that contract, they could begin a third shift. Mr. Celauro summarized the issue 

by saying that for $170,000 a year we can guarantee 250 jobs. These extensions will be 

considered on a case by case basis as is provided for in the uniform tax exemption policy. If this 

company moves and the building is sold as a warehouse, there could be only 25 jobs. Ms. 

Scheidt suggested considering the economic environment we are in and cited Pearl Kamer’s 

most recent report that shows Long Island lost jobs for the seventh consecutive month, the most 

in New York State. Upstate gained jobs during the same period. Other observations in the 

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eport include that the housing market is still going down and doesn’t project it bottoming out 

until 2013 or later. 

Mr. Braun made a motion to grant a five year 100% abatement extension, then ratchet up or 

down by 20% over the next 5 years, with a clawback provision that if Framerica sells or moves 

in the next five years they will be liable for the full assessment. This motion was seconded by 

Mr. Celauro and was unanimously approved. 

Uncle Wally’s 

Uncle Wally’s has roughly 170 employees and two locations on Long Island with their largest 

one located in Brookhaven. They are recipients of one of the Economic Development Council’s 

awards in the amount of $1.5 million. Ms. Scheidt explained the money awarded to Uncle 

Wally’s: they received Excelsior tax credits, of which there are three components, one is the 

Research and Development credit which is based on your annual expenditures that show on your 

tax returns as R & D. There is an investment tax credit for what is shown as expended for 

investments for capital construction. This credit is applied at the time of payment for the 

preceding tax year, as is the job creation credit when you have fulfilled the job creation 

requirements. If for some reason the tax liability is less than the credit, a check is cut for the 

difference. One of Uncle Wally’s PILOTs is expiring shortly, the other in 2015. This extension 

does not include the latter PILOT. Mr. Braun and Ms. Mulligan recommend granting a seven 

year 100% extension on PILOT benefits for the original exemption, then ratchet down by a third 

each year. This is similar to other incentives granted by the Suffolk County and Babylon IDAs. 

Uncle Wally’s is expected to expand as well. Mr. Braun has examined the company’s financials 

and can attest to the hardships they have faced. Mr. Celauro suggested offering the same 

package to Uncle Wally’s as is being offered to Framerica. This 10-year PILOT would be 

structured as 5 years at 100% abatement, then 20% increases for the remaining 5 years. Mr. 

Weir added that if the project does not maintain the required number of jobs, the PILOT amount 

can be raised at the Board’s discretion. Uncle Wally’s has stated they would add more jobs and 

increase their investments in the facility. There was further discussion about maintaining 

consistency in granting extensions, with consideration allowed for a company retaining jobs 

versus a company retaining and creating additional jobs. 

Mr. Celauro made a motion to offer Uncle Wally’s a 10 year extension of their property tax 

abatement, with five years at 100%, then increasing by 20% over the remaining five years. 

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Similar clawback provisions to those considered for Framerica will be put in place. The motion 

was seconded by Mr. LaVita and unanimously approved. 

Drive Train 

Ms. Mulligan informed the Board that Drive Train has not paid the second half of their 2010- 

2011 PILOT. Discussions about beginning the default process have begun, however Drive Train 

recently contacted the Agency stating their intent to pay their arrears. No action will be taken for 

the moment. 

The motion to adjourn the meeting was made at 10:01 AM by Ms. Scheidt and seconded by Mr. 

Celauro. All were in favor. 

The next meeting of the IDA is scheduled for Wednesday, February 15, 2012. 

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TOWN OF BROOKHAVEN - Brookhaven IDA

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