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News Analysis:
McGintee Walk-Out Sheds Light On Divergent CPF Priorities

Originally Posted: April 10, 2008

Peter Neely

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East Hampton Town Supervisor William McGintee's accounting practices have recently been under scrutiny by both the New York State Comptroller’s Office and the Suffolk County District Attorney’s Office for the transfer and repayment of $8 million in CPF funds used to cover shortfalls in the town budget. Photos by Peter Neely and Andrea Aurichio

East Hampton - In yet another headline getting move East Hampton Town Supervisor William McGintee walked out of a CPF Task Force meeting citing growing frustration over a proposed three percent cap on tapping the fund for historic preservation as on-going discussions reiterated no CPF money could be spent on restoration work, a high priority for CPF spending in East Hampton.

"I think that they are creating problems for parks and recreation and historic preservation," McGintee recounted a few days following the walk-out. "They wanted to put a limit on the amount of management and stewardship funds for historic preservation. I objected vehemently."

Scrutiny over usage of CPF monies heightened following the recent discovery regarding the accounting practice in McGintee's administration which resulted in the borrowing of $8 million from the town's Community Preservation Fund (CPF) to balance shortfalls in payroll and operation expenses.

"I think in East Hampton it is not about legitimate historic preservation expenditures - the issue is about utilizing the CPF for subsidizing the budget," New York State Assemblyman Fred Thiele countered. "Some of those expenditures were clearly outside the law. I don't see that as an excuse not to take part in a dialog with fellow elected officials."

The task force has been brought together by Assemblyman Thiele, credited as the author of the landmark legislation that established a two percent "Peconic Tax" collected on home and land transactions in any of the participating five East End towns. The transfer tax is collected on all building sales exempting the initial $250,000 while on land transactions an exemption on the first $100,000 is calculated.

The task force is made up of one member from each of the five East End towns selected by the town's supervisor, as well as representatives from local land preservation groups and community business leaders.

On the eve of the CPF's 10th Anniversary, the task force is charged with vetting questions of proper usage of the CPF account, and in particular stewardship in regards to on-going maintenance expenses incurred, including parks and historic structures that require much more upkeep than farms and open spaces.

New York State Assemblyman Fred Thiele and New York State Senator Ken LaValle are widely credited as architects of the landmark CPF legislation that has accounted for upwards of $500 million in land purchases across the five townships.

"My concern is not what legitimate categorical money is being spent. My concern is the abuse of the CPF in using those funds for expenditures not within legitimate categories," Thiele contended.

Although, just what actually is a legitimate expenditure is currently up for debate in the task force meetings, and additionally, Thiele has asked for a State Comptroller's audit of the fund as a priority with the 10th anniversary of the legislation to be commemorated in June.

When asked about the focus of the meetings of late, Thiele drew attention to the distinction between legitimate expenditures related to preservation and unreasonable subsidy of a town budget, saying that "at this stage we are more focused on whether towns should be able to write off 10 percent of the comptrollers office as a legitimate expense to subsidize the town budget."

Imposition On East Hampton?
"I feel that [the task force] is making regulations and trying to impose them on the towns," McGintee maintained. "These are the town's programs," McGintee added, clarifying that he understood historic preservation and parks and recreation interests to be under-represented at the meetings.

As a solution, the East Hampton Supervisor has proposed drafting an independent management plan with the help of a CPF committee for the eastern most township. The idea was proposed at the East Hampton Town Board Brown Bag meeting on Tuesday, April 1, and was given the support of the full board.

"If the board is trying to set the town's priorities they certainly can do that," Thiele stated, adding that even if the town does come up with an independent CPF management plan, "the CPF rules are set by the state legislature, so no local government can supersede the state law."

The purchase of an historic easement on the 1884 Thomas Moran House in the Village of East Hampton was obtained by appropriating $500,000 of CPF monies and will require the renovation of the home and studio within three years.

McGintee asserts that the Town of East Hampton has been setting the standard for land preservation on the East End since before the CPF legislation came into existence in 1998. The Grace Estate purchase in 1985, which acquired 517 acres in Northwest Woods for the town at a cost of $6.3 million, passed by town referendum in a vote of 2,488 to 1,600, serves as example of the demonstrated push for open space preservation prevalent in the town.

Currently, McGintee contends, historic preservation and renovation work is a high priority in the town and should not be restricted by the CPF legislation.

Leader In Open Space
"I would agree that East Hampton over the years has been a leader on open space," Bob DeLuca, President of Group for the East End who represents his group at the weekly CPF task force meetings, offered. "I think you want to be careful saying that because we did all of this stuff we get a pass and we can change the rules that apply to everyone else."

"This part of the law had been wide open. The task force is doing their best work in trying to figure out how to contribute to what the actual legislation said and what residents voted for. Supervisor McGintee chose to leave the meeting because I don't think people agreed with him, so he said that East Hampton could go it alone and that was where we left it," DeLuca recounted.

East Hampton's proposed CPF Committee established to draft an independent CPF management and spending plan would consist of McGintee, Councilman Brad Loewen, a yet-to-be-determined planner, a representative from the town attorney's office and an individual from the nature preservation committee. McGintee added that he expects to have a completed plan ready within two months.

When asked about the suggested three percent cap on historic preservation expenditures, Thiele clarified that this emerged as part of the discussion, not as a concrete plan.

"I'm not concerned about how much a town spends in each of those categories. That is not the problem we are trying to address," Thiele stated.

At a recent Community Preservation Fund Task Force Meeting local municipal leaders and land preservationists opened discussion over the redefined guidelines regarding the management and stewardship portion of the CPF legislation.

Referencing the controversial Bay Street Theatre proposal in which a collective CPF appropriation supported by East Hampton Town, Southampton Town and Sag Harbor Village would purchase the Bay Street Theatre location from current owner Patrick E. Malloy, III in order to secure the cultural venue on Long Wharf in Sag Harbor, Thiele stated that, "this was proposed under the parks and recreation purpose of the law, which many people felt was intended for outdoor recreation as opposed to indoor recreation. That is a legitimate question that needs to be resolved," Thiele commented, aptly drawing attention to recent public concern that the intention of the CPF as initially adopted by referendum numerous times since 1998 has been stretched beyond its intended use.

Calling the recent 1884 Thomas Moran House earmark of $500,000 from the East Hampton village's portion of the town's CPF account within the statute of the law, Thiele concurred that "the purchase of the easement for historic preservation purposes is clearly a legitimate expenditure under the law."

"I don't think there is any dispute to use the CPF to acquire interest in land for historic preservation or the legitimate restoration of those structures. I would not expect any of the recommendations to impede a town's ability to do that," Thiele clarified.

The next task force meeting is set to take place on Friday, April 11, and the debate is expected to continue as both Supervisor McGintee and Assemblyman Thiele will be in attendance along with fellow task force members and New York State Senator Ken LaValle.

"In a nutshell, the principle work of the committee focused on how to better define the 10 percent for management and stewardship, what we do with it and how it is allocated," DeLuca clarified, adding that refining these definitions are essential to protecting public trust in the landmark legislation.

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Guest (Steve A) from East Hampton says::
Ask Bill's hair dresser... he will know for sure.
May 3, 2008 12:00 am

Guest (John Talmage) from East Hampton says::
CPF is a State Law not Town. The Law describes who should be on the advisory committee. Specificly not elected officials. Remember it is an enviromental law!
Apr 14, 2008 8:31 am

Guest (Mike G) from EastHhampton says::
Don't blame me, I voted for Wilkinson.
Apr 13, 2008 12:00 am

Guest (B. Bond) from East Hampton says::
I think that under the current situation -- Town audits and investigations -- it is a conflict of interest for McGintee to be sitting on the task force as East Hampton's representative. Someone else should be sitting there representing the Town. It is very much in McGintee's interest to have the task force come out in such a way that supports the machinations McGintee went through when using CPF monies for unlawful purposes.
Apr 12, 2008 12:31 pm

Guest (Mike H 1206) from East Hampton says::
Soon McGintee will be in jail so his opinions won't matter.
Apr 12, 2008 10:06 am

Guest (Sideline Observer ) from East Hampton says::
McGintee should stop throwing tantrums! He decries the fact that the Task Force is causing problems. Is the pot calling the kettle black? He is the one who is and has been causing problems - using funds from CPF illegally, stomping out of meetings, etc.
Apr 11, 2008 7:50 pm


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