New revelations cast more doubt on the Y-Gate deal

Grand Theft Y-Gate

By Will Collette

It is a terrible thing to watch two revered and trusted institutions – the Westerly YMCA and the Charlestown Land Trust – debase themselves by attempting to perpetrate a fraud on Charlestown taxpayers.

For months, Progressive Charlestown has covered the attempt by the Y and the Land Trust to bilk taxpayers out of hundreds of thousands of dollars for a worthless conservation easement on that rural junkyard, the Y’s abandoned campground on Watchaug Pond. Click here for all the coverage.

We provided you with every document as it emerged and concluded that Y-Gate was a terrible deal for taxpayers. It turns out that we did not have all the facts. Indeed, more information came out at Monday’s Town Council meeting that shows that the Y-Gate scam is even worse than we have been reporting.

The only good news is that it now seems likely that Charlestown taxpayers will get the chance to vote to end this scandal, one way or the other.

Even after Monday night’s bombshell revelations, the basic framework of the Y-Gate scam remain the same – Charlestown taxpayers are being asked to pay the Charlestown Land Trust for a worthless conservation easement so the Land Trust can buy an over-priced, abandoned campground from the Westerly YMCA.

For some reason, a majority of our Town Council members not only think this is OK but is actually a good deal.

What emerged Monday night was the extent to which the Charlestown Land Trust has been playing fast and loose with the numbers – and even more evidence about how naïve our town leaders are.

First, the numbers. Readers may recall that last year, after killing a perfectly nice conservation development proposed by the YMCA and Ted Veazey, the YMCA found new partners in the Charlestown Land Trust and Sonquipaug Association to turn their abandoned campground into a source of profit.

Instead of a deal where Veazey would have used his own money to build ten nice homes that would have added to the town’s tax base, the new plan called for the land to be bought through a combination of state DEM grant funds and private fund-raising by the Land Trust.

But, oops, by the end of the year, the private fund-raising pledge by the Land Trust disappeared, replaced by a scheme to make Charlestown taxpayers give the Land Trust the money to make the purchase.

In February, the Town Council voted to spend $475,000 on a conservation easement from the Land Trust which would then take the town money and the DEM grant and pay the Westerly YMCA $730,000.

Dr. Jack Donoghue filed suit to block that transaction based on glaring violations of the state Open Meetings Act. Had it not been for Dr. Donoghue’s lawsuit, Charlestown would have already shelled out $475,000, as Forrester Safford pointed out at Monday's meeting. Dr. Donoghue, by the way, has since declared his candidacy for the Town Council.

Dr. Donoghue’s lawsuit bought time to dig deeper into the documents. Among those documents was an appraisal commissioned at some point by the Land Trust.

The appraiser was instructed to do the appraisal based on “conditions known to be false” such as the assumptions the land was zoned residential and that the 20 derelict buildings and other detritus on the site didn’t exist. His appraisal, based on those fantasy conditions: $730,000.

But unlike the Charlestown Town Council, the DEM was unwilling to accept a bogus appraisal. They ordered a new one or else they would not release the $367,000 grant they had approved.

Reluctantly, the Charlestown Land Trust finally did a new appraisal. According to CLT Treasurer Russ Ricci, this appraisal used more realistic conditions. We won’t know whether this is true until we actually see that appraisal. Based on Ricci’s past representations on this subject, why should anyone believe his claims about what’s in the new appraisal?

The new appraisal figure is $412,000, not the $730,000 figure in the earlier bogus appraisal. Because the appraisal is so much lower now, DEM has cut its grant funding from $367,000 to $206,000.

But even that $412,000 appraisal figure is questionable. Former Council member Forrester Safford stepped to the speaker’s podium and identified three prime, south of One, waterfront properties that totaled more than 30 acres and noted that the valuation on these three properties – all true, unspoiled open space and not junked up land – in absolutely prime locations was just over $200,000. He challenged the new $412,000 price tag for the 27.5 acres of junked-up campground based on the results of his research.

But the $412,000 appraisal is not the actual price for the land. The Westerly YMCA wants $600,000 on this land that is now appraised at $412,000. That’s a 46% mark-up.

Now, two comments on the Y’s demand for $600,000 on a property appraised at $412,000.

1. When confronted with a similar disparity between appraised price and asking price for the controversial 81 acres of land owned by Larry LeBlanc, the Council decided there was no way the town could justify paying more than a point or two above the appraisal value. This, despite the fact that LeBlanc’s 81 acres are almost unspoiled open space strategically spanning a long stretch of the moraine along Route One and is the site proposed for a number of unpopular, undesirable land uses that would ruin the scenic highway.

2. What Charlestown homeowner owning a piece of property appraised at $412,000 would expect to be able to sell that property for $600,000? In today’s real estate market, the idea of getting 46% above appraisal is insane. What real estate agent in his or her right mind would even take the listing? Even if you get that much over the appraisal price, what bank would issue a mortgage on that amount?

Oh, and it doesn’t stop there.

Forrester put some uncomfortable questions to Russ Ricci

CLT Treasurer Russ Ricci, with a straight face, continued to claim the clean-up and remediation of the site can be done for $48,000. Forrester Safford who is a construction contractor by trade was astonished and said, “Come on! You can’t remove the chain link fence around the site for that amount!”

Ricci disputed claims that there are health hazards or contaminants on the site. He said they had engineers walking that site many times and they never found any toxic hazards. He disputed whether those old buildings contained lead paint or asbestos.

But if Ricci has had professionals assess the environmental hazards on the site, where are their reports? The appraiser who produced the fairy tale appraisal explicitly said that he did not examine the inside of the buildings for hazards and that, even if he did, he was not qualified to assess environmental problems. He did note in his report that the condition of the buildings was poor.

And we know the buildings are old. We also know that old buildings like that frequently were painted with lead paint and used asbestos-bearing materials in their construction.

Before we can believe Ricci’s blithe claims that there are no hazards on that site, let him produce the reports from those engineers he claims have walked the site – and don’t forget to include their credentials to assess toxic hazards.

The question of whether to put this matter before the voters – including when to do it and how to do it – will be the topic of a second July Town Council meeting on July 23 to address this and other left-over business from the July 9 meeting.

Many, many more questions about the Y-Gate scam remain - including new ones arising from the remarkable revelations made during last Monday's meeting. It is, frankly, baffling how the Town Council can even consider sending this boondoggle to the voters with so many solved mysteries and contradictory statements. 

Between now and then, we’ll see if more actual documents get released or whether townspeople will be required to, as Councilor Gregg Avedisian put it, “find the answers for yourselves” about this terrible deal for Charlestown taxpayers. Click here to read the Westerly Sun's coverage - the quote appears as the last line in the article.

To be continued with more on how a town vote would work and what other options are available to the town to resolve Y-Gate…