At a Public Hearing of the Malone Village Board, held on December 11, 2017 at 6:00 PM at 343 West Main Street the following were present:
Joseph Riccio Mayor
Andrea Dumas Trustee
Brian Langdon Trustee
Norm Bonner Trustee
Archie McKee Trustee
Also in attendance:
Cheryl Douglas, Village Clerk Joseph Maneely
Angela Sirianni-Lucey, Code Enforcement Officer Wei Zheng
Josh Davis, Telegram Tom & Nora Schulz
Stephanie Niles Quin Qung Yu
Peter Dumas, Attorney Kevin Nichols, Attorney
GORMAN BUILDING – The purpose of this public hearing is for the code action brought about against the Gorman Building property.
Attorney Nichols reported that on November 21, 2017 we served Mr. Zheng personally on the order to show cause (Chapter 57 proceeding) on the property at 384-386 West Main Street. Mr. Zheng do you have a copy of that?
Mr. Zheng: He indicated that he did not have a copy of it with him.
Attorney Nichols: Let the record show he did acknowledge he was served personally at the last meeting on the order to show cause. In that document was a letter dated 11/17/17 from the Code Enforcement Officer, a memo to the Village Board, and also in that document was a violation notice in order dated 9/5/17 which had been sent to Mr. Zheng by mail. Mr. Zheng did report that he did not get a copy of that. Also in that document was a last and final notice dated 11/17/17 from the Code Enforcement Officer. There is also a copy of the architect report where Mr. McCarthy determined it was an unsafe building and in need of repair or demolition. I have not received any answer or notice from Mr. Zheng. I would ask that the Board take these documents into evidence. I see that Pete Dumas is here. Are you here appearing for Mr. Zheng?
Peter Dumas: I am.
Attorney Nichols: Do you have a response to our order?
Pete Dumas: Not a written response, but we can make a presentation to the Board.
Attorney Nichols: Do you have an engineer report or an architect report?
Peter Dumas: No we do not have an architect or engineer report at this time.
Attorney Nichols: Now is the time to have it. Those are the documents we have to rely on to make the determination that it is an unsafe building. I would defer to Mr. Dumas to any presentation that he wants to make on Guan Fe Rong LLC and Mr. Zheng.
Pete Dumas: We have been taking steps to make it safe. Mainly the sidewalk. There is a lot of worry about pedestrians and sidewalk. We went to get the permits in order to do it. It is a state permit. We took the steps from NYSDOT to get the permit, and before they could issue it they needed proof of insurance. He contacted a company who said they would do it and then refused to do it. Then he contacted another company, United Rentals and DOT requires proof of insurance before the scaffolding can go up. He is trying to take the steps to make it better. It is a historic structure. I realize from the Village’s point of view it is a dangerous structure. If it has to be taken down we want to take it down in the best way possible and the right way. It is going to cost a lot of money if it has to come down. He is wrestling with the insurance company. In order to get that money together, he has the policy sufficient to cover the building, and sufficient to take it down. But the insurance company is in the business to keep the money in their pocket.
Mayor Riccio: Is his plan to take the building down?
Pete Dumas: If need be, but he would love to save this building to protect his investment. “Denny”, Mr. Zheng is different than some of these absentee owners, in the sense that he wants to do something with this building because it is an investment for him. He wants it either rehabilitated to utilize it, or if it is unsafe then it should come down and he would have a piece of property to utilize in some way. He owns a number of buildings in Malone. One way to approach this rather than being at odds with Mr. Zheng we could offer a daily update to you. He is using money out of his own pocket to get the scaffolding in place.
Mayor Riccio: What is the dollar amount in play?
Pete Dumas: The insurance company is looking at $200-400(K) range as far as demolition. It doesn’t take into account the loss of income, the loss of use, the loss of property. It would leave him at a loss for everything he has invested. The way to go about this is to work side by side with him. Keep the Village updated with every single move, report every single day on the progress.
Angela Siranni Lucey: At the last inspection of that building it wasn’t in that bad of shape.
Pete Dumas: There you go. He is taking the time to make Malone a better place. I hate to see someone chased away. If we have the time, we can settle this with the insurance company. We can make sure the scaffolding is up. I think with time it will make something positive. It is an opportunity for the Village to embrace someone that is doing something for our community.
Attorney Nichols: Is there a time frame?
Pete Dumas: We are hoping that something happens this week with the scaffolding. Jon Miller and I are working on dealing with the insurance companies to get the monies back to Denny. We don’t have a structural engineer.
Archie McKee: Has Mr. Zheng received any insurance money?
Pete Dumas: No he has not accepted any insurance money on the building.
Attorney Nichols: It is our understanding the check was cut and he withheld and didn’t accept it?
Pete Dumas: He didn’t accept it because the insurance company was hoping to settle low.
Attorney Nichols: We did get a report back in August that the cost was $225(K).
Pete Dumas: Denny felt that for that amount of money he could not demolish the building. It would not take into account the worth of the building or his loss.
Attorney Nichols: There is no dispute that it is an unsafe building?
Peter Dumas: From what I saw in the report from Tim McCarthy, yes, I trust Tim. There are differences between an architect and a structural engineer. From an architectural standpoint there are parts of the building that are unsafe. I would want those addressed.
Attorney Nichols: For the purposes of our code an architect report is sufficient and this report clearly states that it is an unsafe structure. The question really is, what is the time frame? Daily updates are great, but there are many days that there is nothing going on. Repair or replace within 60 days, repair or demolish in 60 days, we need a deadline.
Pete Dumas: I don’t want to see the insurance company using a deadline in order to strong arm someone into taking a smaller settlement. I would ask that we have this running every meeting. We will show up every meeting and give you an update. If you are not satisfied with the timing we move forward.
Archie McKee: It seems like Mr. Zheng is more interested in rehabbing the building then putting it back into useful condition. What steps has he taken to do that? How long has it been since the fire?
Peter Dumas: If possible, but he is not a structural engineer. The fire was in July.
Archie McKee: Here we are in December and here he is fumbling around to get a structural engineer. It doesn’t sound like he is trying very hard.
Peter Dumas: Well there was a time for clean up, there was a time when no one was allowed in the building. He has to decide whether it is worth it or not.
Attorney Nichols: Is he going to hire a structural engineer or not and if he is what is the purpose of the engineer?
Peter Dumas: He has to find out if it is safe to rehab the building or if it needs to definitely come down.
Attorney Nichols: When would you have that report?
Peter Dumas: We have to hire someone first. Hopefully in the next couple of weeks.
Archie McKee: Has he talked to any structural engineers?
Peter Dumas: No he has not. He just got lawyers involved.
Archie McKee: Not trying very hard.
Peter Dumas: Even structural engineers cost money. I am here on spec tonight. We have no cooperation from the insurance company.
Archie McKee: What is the last contact he has had with insurance company?
Peter Dumas: He contacted them last week.
Archie McKee: What was there stance?
Peter Dumas: They are still low-balling him.
Archie McKee: What does Mr. Zheng feel it should be, up around 4-500,000 dollars?
Peter Dumas: He feels it should be more than that because of loss of income, loss of structure and either demolition or rehab.
Archie McKee: What steps has he taken to overcome that opinion by the insurance company?
Peter Dumas: He hired Jon Miller this week.
Archie McKee: Again not working very hard.
Mayor Riccio: He had a choice to hire a structural engineer or retain legal counsel.
Peter Dumas: I am not being paid today. This is on spec. I am hoping once we can deal with the insurance company I get paid.
Angela Siranni Lucey: I have a suggestion, since Denny has counsel why don’t we say see what you can do in a month, come back to the next Board meeting and see where we are then.
Peter Dumas: If you can give us a month and in that month’s time there isn’t any progress, I don’t think we would have as many viable excuses at that point.
Attorney Nichols: Is he just thinking about hiring an engineer or is he absolutely going to hire an engineer?
Peter Dumas: If the insurance company came back with the right number and said he had to demolish the building, I think at that point he would demolish.
Mayor Riccio: Is he going to hire an engineer or is he just thinking about?
Joey Maneely: He doesn’t know whether he is going to get paid well enough for the demolition.
Peter Dumas: We are thinking about it, but it is more than just maybe. We have to look at the cost benefit analysis, hiring a structural engineer and possibly rehabbing the building and if the cost benefit analysis isn’t working for my client obviously it will go straight to demolition.
Archie McKee: It sounds like he is going to settle with the insurance company before he does anything.
Peter Dumas: I hope not. I hope the insurance company comes forward and does the right thing soon.
Archie McKee: Is he waiting for the insurance company to contact him or is he contacting the insurance company?
Peter Dumas: Jon Miller and I are going to be contacting the insurance company.
Attorney Nichols: You guys are both co-counsel?
Peter Dumas: I represent Denny with regards to any violations and addressing the Board and Jon is co-counsel and represents Denny with regards to the insurance company.
Attorney Nichols: There is nothing to keep us declaring it unsafe today? You just don’t want an order that gives a deadline.
Peter Dumas: At this point.
Attorney Nichols: If we declare it unsafe today and we convene at a future date to determine what should be done, there is no dispute.
Peter Dumas: What I would ask is if the Village decides to declare it unsafe today, I would ask that you leave it as a rebuttal presumption so that if we do hire a structural engineer it is something that we could save this building. I don’t want an unsafe building tagged to this building and it needs to go away. I would like to see this building saved.
Attorney Nichols: It sounds like if he gets the right settlement it is coming down any way.
Peter Dumas: Not necessarily. If he gets the right settlement his first aim is to rehabilitate the building. Certainly if they say it is unsafe and it can’t be rehabilitated or if the rehabilitation costs go far beyond the means of the insurance company is willing to do I think his hands are tied and he would have to take it down.
Attorney Nichols: How does an unsafe declaration affect his position? It is just there, you take a look at it and you know it is unsafe. So how does that affect his position?
Peter Dumas: It doesn’t affect his position. I don’t want to get caught labeling this building as unsafe and then having Denny at some point come back and say look we have done the research, we have the reports, we want to rehab this building and then have everyone say it is an unsafe building and it has to come down.
Attorney Nichols: I am not saying the building has to come down, it is either repair or demolish. You have to do something.
Peter Dumas: I have to protect Denny as it is $250 a day and 15 days in jail for each day.
Attorney Nichols: Our intention is not to do anything other than to make sure it doesn’t continue in an unsafe condition.
Mayor Riccio: Denny’s priorities are different in that he has to work it out with his insurance company, but our priorities are different. The status as an unsafe building is a rebuttal presumption, we can declare it unsafe right now and you can come back at any point and say here is how we think differently. Repair or demolish. Declaring it unsafe doesn’t mean it has to come down. The unsafe structure without a deadline is meaningless.
Peter Dumas: I like the idea of giving it a month and hopefully we come back with some progress. They cut the right check, work starts the next day. At this point I don’t know how he could fund it.
Archie McKee: What arguments is Mr. Zheng giving the insurance company to persuade them to increase their settlement?
Peter Dumas: Loss of income, cost of rehab, loss of investment in structure, litigation costs. We may consider lawsuit against the insurance company, but would rather come to the table to an agreement with them.
Attorney Nichols: If we declare it unsafe today what would you expect to bring back in 30 days?
Peter Dumas: Hopefully have the scaffolding up, hoping to address any issues with the building that are blatantly unsafe, something that can be fixed right now, without going to the great task of either rehabbing the building or demolishing the building.