Countersuit Filed in Town-City PILOT Dispute

May 31, 2018

New litigation has been filed in the dispute over shared PILOT payments between the town and city of Plattsburgh.  The town has countersued the city and its supervisor is blaming the mayor for the dispute.

In December, Plattsburgh Mayor Colin Read was caught on an open mic discussing with a city councilor his concerns about a PILOT, or Payment In Lieu Of Taxes, agreement, with the Town of Plattsburgh.  During that conversation he said the town might owe the city as much as $10 million.

Soon after, Mayor Read explained the PILOT is based on a 26-year-old agreement between the city and town regarding property now owned by Falcon Seaboard.  “It was by far and away the city’s largest property revenue source. Somehow in 2009 the amount that went to the city declined by about 90 percent.  Then in 2017 another set of negotiations occurred, again without an inclusion of the city, which brought the city’s share down dramatically again. So we’re trying to understand how all that occurred.”

The mayor submitted a FOIA request for documents and retained a private law firm to determine why the city’s share of payments declined.  Then on March 13th the city filed suit against the town claiming that the  PILOT agreement had been violated and the city is owed more than a million dollars.

During last week’s city council meeting Ward 3 Republican Dale Dowdle asked Mayor Read about developments in the dispute.  “I understand the town now has litigation against us?”
Read: That’s correct.
Dowdle: “And is that a new development or?”
Read:  “It’s a development in the response to our concerns over the pattern of payments for Falcon Seaboard. Their contention is that they signed the 1992 agreement with the city under duress.”
Dowdle:  “So?”
Read:  “And their suit is for $1.5 million.”

Town of Plattsburgh Supervisor Michael Cashman has been critical of the mayor’s actions throughout and this week confirmed the town’s countersuit in an interview with WAMC.   “We are countersuing for approximately $1.5 million.  In the 1992 agreement it was really done with bullying tactics.  Falcon Seaboard or Saranac Power it’s you know been under different names that facility is in the Town of Plattsburgh. You know we were trying to be good neighbors back then because we were trying to bring jobs. We were trying to bring about natural gas to the region.  And unfortunately the mayor is using the same tactics back in 1992 by suing the Town of Plattsburgh with a frivolous lawsuit.”  

Cashman is adamant that there is no standing for the mayor’s legal arguments.  “The mayor is trying to find money where there isn’t money. He is miscategorizing conversations. He’s telling half truths. He’s obviously not even speaking with his team on the city council which is most disappointing. And that’s why I say it’s not the Town of Plattsburgh and the City of Plattsburgh any more,  it truly is becoming the Town of Plattsburgh versus Mayor Read.”

Mayor Read declined to speak with WAMC on the record regarding the town’s countersuit. He referred any technical questions to the city’s attorney, Bill Owens,  who says it will have no impact on the city’s lawsuit beyond litigating the issues raised in the counterclaims.   “They have basically come back and attempted to find some damages that they can assert to offset the claims of the city.  Whether or not those are sustainable is a completely open question at this juncture.”

A response to the countersuit has been filed.

Owens is a former congressman and a commentator for WAMC.