Friday, November 17, 2006

The Mark Houraney saga

Mark Houraney is the poster child for everything that's wrong with the Calverton Enterprise Park.

He wanted to run the airport there, and Councilman Ed Densieski and Supervisor Bob Kozakiewicz wanted him to do it — in spite of a clear message against an airport by the voters in a referendum several years ago. So they made sure not to call it an airport, but they were intent on putting in place all the trappings of an airport. And that included a fixed base operator — the guy with the right to sell fuel, maintain a terminal, maintain the runway and control access to it. Enter Mark Houraney. While they weren't calling him the FBO, the management agreement they negotiated with him and were set to approve in the spring of 2003 was actually an agreement to make him the airport's FBO.

Mr. Houraney believed he was going to make a ton of money at it. The dollar loss he claimed in his breach of contract action in federal court was $50 million.

He was so eager to begin — and so certain the deal was done — that he started marketing his plan on the Internet before his management agreement was approved — publicly, at least — by the Town Board. The Town Board had one brief public meeting on the deal, which is how I learned of it. But the whole thing was negotiated behind closed doors, in executive session, or privately in officials' offices. It was a done deal, until we published a front page story on Dec. 19, 2002, disclosing it for what it was, using Mr. Houraney's own words from his Web site. There, he offered Calverton to business executives as an alternative to New York City's crowded airports, just a short helicopter ride from Manhattan. He also offered jet charter service into and out of the site. And aircraft fueling, storage and maintenance.

So, just as the Town Board was poised to ink Mr. Houraney's 20-year management agreement — which, among other things, gave him the exclusive right to develop regulations governing the use of the runway — without ever airing the terms of the that agreement in public, The News-Review went to press with the story of what Mr. Houraney was actually planning to do at EPCAL, drawing attention to the fact that the town was proceeding without a bidding process, which seemed a clear violation of applicable law. And people went ballistic.

Mr. Houraney's plans — hatched, it seemed to us, with airport proponents Ed Densieski and Steve Kirschenbaum — sputtered, stalled and skidded off the runway.

But Mr. Houraney had ensconced himself in an office at the top of the old Grumman control tower, which he was leasing from a company that had purchased the building from developer Jan Burman — the man who bought the entire developed area at EPCAL, known as "the industrial core," from the town for $17 million, dubbed "the great Grumman giveaway" by Koz and Ed in their successful 1999 election campaign.

Mr. Houraney was there because, without much public attention, the Town Board in October 2002 had already signed a runway use agreement with him. From his perch atop the control tower, he pursued his plans, even though the FBO deal wasn't signed. He bought equipment, including fuel tanks. He applied to the FAA for various approvals, some of which Mr. Kozakiewicz signed off on as town supervisor. And he had, pursuant to his runway use agreement, the right to use the runway.

2003 was a bad year for Mr. Houraney. First, The News-Review stalled his FBO plans, which, it turned out, were permanently scuttled. Then things went sour between him and Steve Kirschenbaum. It's still not clear to me what their relationship was or how Mr. Kirschenbaum fit into Mr. Houraney's airport dreams. But they did share that airport dream. And in furtherance of that dream, they planned the New York Air Show, which Mr. Kirschenbaum and his airport ally Joe Van de Wetering pitched to the Town Board as a fundraiser for Central Suffolk Hospital, where Mr. Van de Wetering served as chairman of the board of directors. For that "good cause," the town gave the air show use of the facility at no charge, except the reimbursement of town police costs of $50,000.

The public will probably never know how much money Mr. Kirschenbaum made off the air show. He drew payments during the planning stages and never provided the town with a complete accounting of the cash that came in at the gate over the course of the weekend. Cars were backed up bumper to bumper from the EPCAL entrance on Route 25 in Calverton to LIE Exit 68 at William Floyd Parkway. But somehow, the air show was a bust and the hospital wasn't going to see a plug nickel — until this newspaper got all over Mr. Kirschenbaum's case and he forked up a $5,000 donation to the event's supposed beneficiary. The town didn't even get its police costs reimbursed. And its pursuit of the matter has been, at best, impotent. I'm resigned to having these questions remain forever unanswered. And I guess I'm the only person in town that's still bothered by this "mystery" — and by the fact that Mr. Kirschenbaum and Mr. Van de Wetering are both principals in Grumman Memorial Park, another not-for-profit venture using town-owned land at EPCAL.

Mr. Houraney says his relationship with Mr. Kirschenbaum went south after Steve decided to take the air show fuel concession away from him and sell it to an Islip-based company for a $25,000 fee. Selling fuel at the air show was to have made Mr. Houraney a tidy sum, and he was hopping mad. Feeling betrayed, he proceeded to do whatever he could to get back at his former friend, including coming to me with Quicken printouts of the air show's operating account. I was very surprised to hear from Mark when he called shortly before the air show was to take place. Since I'd played a big part in mucking up his FBO plans, I was no friend of Mark Houraney's. Why would he be tipping me off on a story like this? The desire for vengeance will do strange things to people.

Mr. Houraney's attempts to get back at Steve Kirschenbaum didn't stop there. He called the FAA, complaining that the runway was in unsafe condition. He sent photos of town highway department workers patching potholes in the runway. He called and wrote and met with the supervisor. If he was going to be cut out of the air show, he was going to do everything he could to make sure it didn't happen.

But Supervisor Kozakiewicz had the opposite resolve. After the Field Day debacle that summer — the three-day big name concert that was canceled at the last minute because the county determined that the town didn't have adequate law enforcement plans in place — Koz, who was facing reelection that fall, could not afford another EPCAL embarrassment. (The multimillion dollar Field Day lawsuit is still pending.) The air show was going to happen and if Mr. Houraney got in the way, he would be eliminated. Figuratively speaking, of course.

And that's exactly what happened. Mr. Houraney demanded that the air show pay him $25,000 to forfeit use of the runway for the weekend of the event, as others with runway use rights had been paid to keep off the runway. His former friend Steve told him to get lost. He threatened to hold a "fly-in" that weekend. The town responded by revoking his runway use agreement — claiming that he was in breach of contract because he hadn't bought property at EPCAL. The letter advising Mr. Houraney of the revocation was faxed to his attorney on the Friday afternoon of the air show weekend.

And so, Mr. Houraney's $50 million lawsuit was born. It was subsequently amended to include a civil rights claim (and another $130 million in damages sought) thanks to stupid comments made by town officials during a closed door settlement discussion that Mr. Houraney, of Middle Eastern heritage, found offensive. Mr. Densieski said they were only joking when they made those cracks about whether Mr. Houraney would store Osama bin Laden's planes at EPCAL. Mr. Houraney didn't find them funny.

Town officials trying to accomplish something on the sly that the public had resoundingly rejected in a referendum (the airport). Closed door meetings. No bid contracts. Good ol' boy back room deals. Political ambition taking priority over public interest. A healthy dose of avarice. Pure stupidity. (Yes, public officials shouldn't make Osama bin Laden jokes to a guy of Arab-American ethnicity, Eddie, especially during federal lawsuit settlement discussions.)

For all these reasons and more, the town's handling of Mark Houraney's proposal exemplifies everything wrong with EPCAL — a textbook case of how not to manage an "enterprise zone," bungled from start (selling all the buildings and central facility for $17 million) to finish (the ultimate development of hundreds of houses there, which will certainly ensure that no meaningful industrial or economic development will ever occur.)

What a shame.

Copyright 2006 Times/Review Newspapers

1 comment:

ceil said...

Jeez! This was before my time. This reads like a spy thriller - Wow! What a piece of history. You know I never did completely piece together the EPCAL thing - until now. The powers that be in the Town of Riverhead (which obviously I hold near and dear to my heart) makes some real blunders -why is that? No watch dog in place except the exceptional reporting in the News-Review. Gotta wonder!