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Town hires outside law firm to help collect money from Luminati

04/13/2019 6:56 AM |

The Riverhead Town Board Thursday voted to hire an outside law firm to help the town collect unpaid runway use agreement fees and unpaid false alarm fees owed to the town by Luminati Aerospace LLC.

The Town Board voted 4-0, with Councilman Jim Wooten absent, to hire the law firm of Sinnreich, Kosakoff & Messina as special counsel to represent the Town Board in collection of outstanding alarm fees and enforcement of the runway use agreement with Luminati Aerospace LLC.

According to town police, Luminati owes $22,820 in unpaid false alarm fines from 2016 through the first quarter of this year.

Luminati also hasn’t paid a monthly runway use fee of $2,765 since September, according to Supervisor Laura Jens-Smith.

The annual fee, established in 2015, was $31,810 per year, subject to an annual cost of living increase.

“It’s not just to collect the back fees,” Ms. Jens-Smith said. “It’s is the runway use agreement in totality and whether they are in compliance with it.”

She said there’s a possibility Luminati could lose their use of the runway if the are in violation of the agreement.

Luminati owns 25% of Calverton Aviation and Technology, the company in contract to buy 1,643 acres of land from Riverhead Town at the Enterprise Park at Calverton for $40 million.

The other 75% is owned by Triple Five Group, the company that built large shopping and entertainment centers like the Mall of America in Minnesota.

Luminati owns property at 400 David Court in EPCAL, and also had been leasing space at the former Grumman Plant 6.

However, the owner of Plant 6, Laoudis of Calverton, brought an eviction notice against Luminati in March, claiming they owed rent, and Luminati voluntarily agreed to move out of the property.

Luminati also is facing a lawsuit from Hexcel Corporation, a Stamford, Conn.-based company that claims Luminati defaulted on a $10 million loan it made to Luminati in 2016.

Hexcel is asking the court to seize about $7.4 million worth of property belonging to Luminati at EPCAL and to turn it over to them, citing clauses in their agreement.

Rex Farr, of EPCAL Watch, a civic group, supported the town’s actions and suggested it go further.

“As the news has unfolded over these past several weeks, it is apparent the good will and trust of the residents of the Town of Riverhead has been exploited on numerous occasions by Daniel Preston and his elusive business enterprise, Luminati LLC,” he said.

Mr, Farr urged the town to engage outside counsel with “fresh eyes,” with expertise and experience in contract law, with no prior involvement with Riverhead Town and with no connection or business with any current or prior entity at EPCAL.

“Rex, I don’t disagree with you, I think it’s something we do need to discuss,” Ms. Jens-Smith said.

But she said the resolution being voted on Thursday pertain only to Luminati and the unpaid false alarm and runway use fees.

The Town Board also currently has retained Frank Isler, as outside counsel,  working on the contract of sale with CAT, she said.

That arrangement is not impacted by Thursday’s resolution, officials said.

The Town Attorney’s office is conflicted because they are working on the closing, Councilwoman Jodi Giglio said. “They can’t do both.”

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