In light of economic downturn, Riverhead Town Board seeks – and will get- updated financials from CAT
The Riverhead Town Board is asking Calverton Aviation & Technology to voluntarily submit updated financial information and a commitment confirming their financial capability to proceed with the intended build-out of the property, according to Supervisor Yvette Aguiar, who issued a press release to that effect Monday afternoon.
The request comes in light of the global COVID-19 pandemic and the severe economic impact it has had on the global economy, according to the supervisor.
And CAT has agreed.
“Although not required by the Agreement or necessary under the Qualified and Eligible Sponsorship hearing process, as a courtesy, in response to the Town’s request, CAT intends to voluntarily submit updated documents of financial capability,” said a written statement from CAT, provided by their attorney, Chris Kent.
CAT had proposed to build aviation and technology uses at the site.
“While an update for financial status was not stipulated in the original contract, we have urged CAT to consider this request,” Ms. Aguiar said.
“The request to volunteer updated financial documents is to reassure confidence to the Town Board and the public that CAT has the financial capability and readiness of funds to purchase the property and develop the property.”
“We all requested that,” said Councilman Tim Hubbard. “With the state of the economy because of the coronavirus, we want to make sure they can still do this.”
The contract — which calls for the town to sell 1,643 acres of land to CAT at the Enterprise Park at Calverton for $40 million — calls for the 8-lot subdivision of the land to be complete by May 15, or either side could pull out of the deal.
The subdivision, which separates the three lots that would be sold to CAT from the three that the town will retain, is required in order to sell the lots.
CAT underwent a “qualified and eligible sponsor” hearing in 2018 to show that that they have the finances to buy the land and the ability to develop it in accordance with the intended development plan CAT submitted for the site.
The Town Board declared CAT “qualified and eligible” by a 3-2 vote in November 2018, with the vote split along party lines.
Councilwoman Jodi Giglio said the town is seeking the same information as during the qualified and eligible hearing.
“I think they will close on the property and build out the project and they will pay their $4 million per year in property taxes,” she said.
The town estimates that the land only — before it’s developed — will bring in $4 million per year in property tax revenue per year, she said.
Ms. Giglio said she believes only about 600 acres of the 1,643 can be developed because the rest will be limited by the state Department of Environmental Conservation.
Councilwoman Catherine Kent said she had been pushing for the Town Board to make the request since early April.
“I was pretty consistent in pushing for it and I was glad the rest of the board came on board,” she said. “As elected officials, it’s our responsibility to advocate for the town, and this is our greatest asset.”
Ms. Kent said she started talking about seeking updated financial information from CAT because “as we watched all the problems with the economy — and we certainly are all aware that CAT has a lot of investment in retail and malls — my concerns about their financials increased. We need to hear from them that they are going to do what they promised to do at EPCAL.”
Rex Farr of EPCAL Watch, a group that has been critical of the town’s handling of the EPCAL site, said the group has also been pushing the town to request the updated info.
“We’re on board with that,” he said. “But do I think we’ll get it? I don’t know. That’s a whole other question.”
Mr. Farr’s comment was made before CAT issued its statement.
CAT is 75% controlled by Triple Five Group, best known a major development of malls such as the Mall of America in Minnesota, and 25% owned by Luminati Aerospace, which has moved its operations out of EPCAL.
