Board Expected to Move Past Riverhead Resorts Today; Vote on Ending Contract

At its 2 p.m. meeting today, the Riverhead Town Board is scheduled to vote on a resolution which, if passed, would officially terminate the town's contract with Riverhead Resorts to purchase 755 acres at Enterprise Park in Calverton (EPCAL) for $108 million to build a massive resort complex at the old Grumman property.

The resolution is expected to be approved because three board members – Supervisor Sean Walter, Councilman George Gabrielsen and Councilwoman Jodi Giglio – are already on record saying they will vote "yes."

So the questions become:

• Will this mark the end of a project that has been in the works for at least three years?
• If Riverhead Resorts comes up with the approximately $6 million in payments that are now overdue, would the Town Board simply then rescind the resolution and reinstate the contract?
• Would the resolution put in motion a number of hurdles that would have to be overcome for Riverhead Resorts to get back into the game?

Supervisor Walter says talk of a new request for proposal - a time-comsuming process that would essentially force Rieverhead Resorts to submit its proposal for the property again - "doesn't make sense to me." Reached at his home Monday evening, he said, "There's no requirement to go out with an RFP. Under Urban Renewal law, you could give the property to Riverhead Resorts for free if you could come up with a realistic reason for doing it.

"So why would you have to go out for an RFP? If Riverhead Resorts came in with $6 million and they were willing to pay $146,000 an acre in this market, I say 'take it,'" he said, adding that he thinks the rest of the Town Board would also vote to reinstate the contract and take the money.

Mitch Pally of the Weber Law Group, thinks an RFP may be required. Pally said, "We have not talked to Frank Isler, the town's outside counselor, but we would be concerned that the town might have to go back for an RFP to do it all over again, which would be very disconcerting.

"Obviously we would prefer from a legal perspective that no resolution be voted on by the town because any resolution and what it says will have consequences – some known and some unknown," Pally said.

Walter said that the contract with Riverhead Resorts ended on June 15 when payments due on that date were not received and said the only reason for the resolution is to convince the state's Department of Environmental Conservation that Riverhead Resorts no longer has a contract with the town.

"The DEC wants us to assess the environmental impacts of the Riverhead Resorts project," Walter said. "But if we have no contract with them, why would I assess the environmental impacts of Riverhead Resorts?"

Councilmen John Dunleavey and James Wooten have both voiced disagreement with the resolution, saying the contract became void when Riverhead Resorts missed its extension payment date. Therefore, Tuesday's vote is unnecessary.

"This is just to keep the project on the front page," Wooten said on Tuesday. "It holds no weight. I say let Riverhead Resorts flounder, and if something happens, it happens. We have to keep our options open."

With Riverhead Resorts out of the picture, Walter said, the town could proceed on its own to subdivide the property, a necessary step before any sale could be closed.

Walter said that Riverhead Resorts has put pressure on him not to put today's resolution forward. "But my deal with the town residents," Walter said, "is to get something done at EPCAL, and I can't move the subdivision forward while Riverhead Resorts is looming out there."