July 11, 2004
Myriad of deals done to carve out new village
By Chris McKenna
Times Herald-Record
cmckenna@th-record.com Kiryas Joel – In January, when one of the last farms in Monroe and Woodbury quietly changed hands in two quick deals, a mysterious organization from Kiryas Joel with $12.7 million at its disposal wound up with the 140-acre prize.
Less than two months later, when news broke of a plan to annex the newly bought ACE Farm and hundreds more acres into Kiryas Joel, the same entity was said to be coordinating the effort.
That entity is Vaad Hakiryah of Kiryas Joel Inc., an organization tied to the Satmar Hasidic community's main synagogue – Congregation Yetev Lev D'Satmar – and led by a former village official named Mayer Hirsch.
For at least 12 years, it has held much of Kiryas Joel's vacant land and acted as its invisible hand of development, parceling out precious acres to builders erecting multi-family housing to keep pace with the rapid population growth.
Until recently, Vaad Hakiryah was known only in the insular and divided world of the Satmar Hasidim, where dissidents have long complained that it controls Kiryas Joel's housing market and improperly bridges church and state realms – charges that village officials steadfastly deny.
But with the ACE Farm purchase and annexation plan, Vaad Hakiryah – which now owns at least 310 undeveloped acres outside of Kiryas Joel in Monroe and Woodbury – has stepped into the increasingly heated politics surrounding the development of one of New York's youngest and fastest-growing communities.
Its role could soon become even more prominent – and the atmosphere hotter.
A Kiryas Joel official, speaking on condition of anonymity, revealed late last week that Vaad Hakiryah has shelved the annexation plan and instead will seek to incorporate a second Hasidic village – an alternative that could prove faster than annexation, while bypassing opposition from the leaders of neighboring towns.
Vaad Hakiryah means roughly "the committee of the settlement" in Yiddish, the primary language in Kiryas Joel. When it formed, who created it and how it came to possess so much of Kiryas Joel's vacant land is a matter of dispute, like so much else in the village.
Public records indicate it officially came into being in October 1989, when it was incorporated with Hirsch – then a village trustee – as its leader. The following July, four paper corporations were created to hold and transfer its land.
Two years later, on a single day in October 1992, 32 parcels totaling 153 acres passed into its hands. The inherited land made up 22 percent of the village's meager 1.1 square miles.
The reason for the transfer is unclear. William Goldenberg, a 68-year-old Kiryas Joel resident who appears to have signed the deeds shifting ownership from five paper corporations to the four controlled by Vaad Hakiryah, didn't return numerous phone calls for comment.
Over the years, Vaad Hakiryah has carved up its land and distributed much of it among developers, the village government, the United Talmudical Academy of Kiryas Joel Inc. – the religious school system used by most children in the community – and other entities.
Records of those transactions suggest that Vaad Hakiryah has at times used its valuable land to help the UTA raise money.
For example, while dicing and distributing a 79-acre chunk of land off Mountain Road – where most of Kiryas Joel's new development is taking place – it gave or sold the UTA 65 acres. The school system later sold the land to developers for $11.2 million. (See sidebar, "Carving the pie.")
Dissidents have repeatedly charged in federal lawsuits against the village that Vaad Hakiryah operates in a blurred nexus of government and synagogue leadership in Kiryas Joel.
Michael Sussman, a Goshen-based civil rights lawyer who has represented the dissidents, charged in a 1997 complaint that the organization was merely an association of congregation members and village officials and "the vehicle by which impermissible entanglement between government and religion is effected."
The charge was based partly on the revelation that Moses Teitelbaum, the Satmar grand rebbe, had decreed in May 1989 that builders must pay the UTA $10,000 for every new apartment and that Vaad Hakiryah would collect the money. The payments were said to pay for the new school space needed to accommodate the added population.
The dissidents implied that the village wouldn't issue building permits – a municipal function – until a religious school system had been paid. But they submitted no evidence linking the payments to building permits, and village officials denied any such link existed.
"No such monies have ever been received during my tenure as village clerk," Gedalye Szegedin replied in a court statement.
He said he was "unaware of any instance in which a developer was denied a building permit or other municipal approvals by the village because of this alleged $10,000 payment."
Dissidents supported their argument by pointing to the overlapping leadership of Vaad Hakiryah, the congregation and village government.
For instance, Kiryas Joel Mayor Abraham Wieder, a municipal official since 1984 and a former Congregation Yetev Lev president, signed public documents as the president of Vaad Hakiryah at least three times in 1990 and 1991, while he was deputy mayor. Copies of those papers were filed in court as evidence in connection with a 1995 dissident lawsuit.
Another link was Hirsch, a village trustee from 1982 to 1990 and chairman of the planning and zoning boards from 1990 to 1997 – while he was also the leader of Vaad Hakiryah.
During the 1990s, while running Vaad Hakirayh, Hirsch also was chairman of the Kiryas Joel Municipal Local Development Corp., a quasi-governmental agency whose building projects included the village medical center, completed in 1999.
Today, Hirsch, 54, serves on no village boards but is vice chairman of the development corporation. Both he and Wieder, in addition to their other roles, are trustees of the UTA school system.
Hirsch declined to comment for this story, referring all questions to his lawyer. Wieder, 55, also wouldn't discuss Vaad Hakiryah.
"The Vaad is neither part of, nor affiliated with the Village of Kiryas Joel," Hirsch's lawyer, Dennis Lynch of Nyack, wrote in response to written questions.
Refusing to discuss any of the organization's business dealings, Lynch also wrote: "The Vaad as a private for-profit entity is not required to disclose confidential commercial business matters including what properties it manages, if any."
Here's one property Vaad Hakiryah now manages: ACE Farm.
Earlier this year, word leaked out that the beloved, family-owned institution where locals have bought fresh eggs and other produce for years, had finally been sold to a developer – as neighbors long feared.
The buyer at first appeared to be a businessman from Corinth, who wanted to open some sort of recycling operation. But Ralph Petruzzo turned out to be merely a front man: He had actually flipped the Etzel family's land within days for a $1 million profit to Vaad Hakiryah.
For neighbors, the news conjured unpleasant images of more dense housing spreading across the 140 acres of fields bordering Kiryas Joel.
They got another shock in March, when it turned out plans had already emerged to try to annex ACE Farm and other Hasidic-owned property into Kiryas Joel from neighboring Monroe and Woodbury.
The Hasidic property owners had received a proposed contract, written in Hebrew, saying that Vaad Hakiryah would bundle their property with its own in a single annexation request.
In return, the landowners would have to pay $12 for every square foot of apartment space that could be built on their land – a charge that would pour millions of dollars into Vaad Hakiryah's coffers.
The proposal justified the charge by saying the organization had spent "tens of millions of dollars" on the community – to build roads, water and sewer lines, synagogues, ritual baths, the medical center, the shopping center and more – and would spend millions more in the future.
It's impossible to determine the extent to which those claims are true.
Lynch would say only that Vaad Hakiryah, like any other developer, has paid for "water, sewer lines, roads and other infrastructure" and then turned over the finished products to "the municipality having appropriate jurisdiction" – in this case, Kiryas Joel.
But he also distanced Vaad Hakiryah from any claims made in the proposal, saying it was written by a planner named Simon Gelb and has not been approved by Hirsch or his organization. Gelb, 33, who lives in Kiryas Joel, didn't return calls seeking comment.
A citizens' group called the Southern Orange County Alliance has since sprung up to oppose any future annexation request, as well as Kiryas Joel's plan to tap into New York City's water supply to meet its constantly rising demand – seen by opponents as the engine for more explosive growth.
But it now appears there may be no annexation request to resist. Instead, the Alliance might soon encounter a new target: a proposed village called Kiryas V'Yoel Moshe.
Carving the pie
Here is how Vaad Hakiryah, Kiryas Joel's invisible hand of development, has carved up and distributed a 79.5-acre chunk of land it inherited in October 1992 from several paper corporations.
Mazel Properties of Brooklyn bought the land from a Montgomery woman in January 1979, when it was an undeveloped tract in Monroe bordering the 2-year-old Village of Kiryas Joel. Kiryas Joel annexed the property in 1983 and dubbed it Section 307 on tax maps.
The property has since been subdivided numerous times and distributed, mostly to developers. Almost 65 acres passed first through the hands of the United Talmudical Academy of Kiryas Joel Inc., the village's religious school system. Property records show the UTA sold its share of the land in 1995 to developers for $11.2 million. Within the past five years, 222 condominiums and apartments have been built and occupied, 207 are nearing completion, and at least 318 are planned – a total of 747 homes.
1. 207 condos nearing completion and 126 more planned on 36.7 acres. Includes property the UTA sold to Kiryas Joel builder Abraham Goldberger on March 25, 2003, for $6.7 million.
2. 48 condos on 2.3 acres. Part of land UTA sold to Kiryas Joel developer Jacob Sofer on Feb. 20, 2003, for $1.2 million.
3. 48 apartments and grocery store on 5.4 acres. UTA sold the land to Shamrock Affordable Housing on April 29, 1999, for $481,000.
4. 102 condos on 7 acres, partly vacant. UTA sold Sofer the land on Jan. 26, 2001, for $1.6 million. (Six condos built by GPN Construction, which bought less than an acre from Sofer on Nov. 19, 2002 for $600,000.)
5. 24 condos on 1.3 acres. Part of land UTA sold Sofer on Feb. 20, 2003, for $1.2 million.
6. Partly cleared for construction of 192 proposed condos on 11.5 acres. Vaad Hakiryah sold Sofer the land on June 19, 2003, for $1.38 million.
7. Municipal water tank, Village of Kiryas Joel.
8. Vacant home on 5.2 acres, owned by Solomon Berkowitz.
9. Two municipal building projects on 4.4 acres. A new fire station – which will have a workforce development center on the second floor – opened this year. Behind the fire station, construction has started on a convalescence center for mothers. The village sold the land to the Kiryas Joel Municipal Local Development Corp. on Nov. 11, 2003, for $387,000.
July 11, 2004
Making a new village
By Maureen Nandini Mitra
Times Herald-Record
mmitra@th-record.com Welcome to the balkanization of southern Orange County, where speculation, tension and rumors are rife these days.
Petitions to incorporate as villages are circulating in south Blooming Grove and Woodbury.
Simultaneously, the Hasidim, whom the residents of these towns are trying to keep out, have plans afoot to create another village near Kiryas Joel.
While the clash between two cultures has people on both sides scrambling for legal protections, there's little information on the streets about what creating another tier of local government would mean and how that could help maintain a way of life that each of these groups is trying to preserve.
Here are some common questions about creating new villages:
Why create a village?
Since 1940, there have been 25 villages created in New York.
In recent years, the most commonly cited reason for seeking incorporation is the desire to control or limit development, principally by getting more localized control over zoning. That is what residents spearheading the moves in Blooming Grove and Woodbury are hoping to achieve. The idea is to put in place zoning laws that would prevent high-density housing that Kiryas Joel prefers and also block possible annexation moves by the Hasidic village.
The youngest village in New York is East Nassau in Rensselaer County, which was incorporated in 1998 to keep a quarry from setting up shop in the area.
The village has a population of more than 500 and an annual budget of $108,000.
How is a village formed?
To be incorporated as a village, a petition signed by 20 percent of the qualified voters in the area, or by owners of 50 percent of assessed value of the area in question, has to be submitted to the town supervisor, who then schedules a public hearing.
The area to be incorporated shouldn't exceed 5 square miles and should have a population of at least 500.
Following the hearing, the supervisor makes a written determination of the sufficiency of the petition. Once the petition is approved, an election is held within the proposed village area.
If the proposal gets a majority vote, a new village can be formed. It does not require approval of other governing bodies at the state or local levels.
Can creating a village stop annexation?
Technically, no. A village can annex land from another village. Creating one could, however, have a substantial impact in letting a petition to request annexation move forward, says Eamon Moynihan, spokesman for the New York Department of State.
In order to have an annexation petition go through, 20 percent of the village population eligible to vote, or people who own 50 percent of the assessed value of the area in question, have to agree to be annexed.
Obviously, in a village where most residents want to keep the Hasids out, such a move can be blocked, or at least delayed substantially, says SUNY New Paltz political scientist Gerry Benjamin.
Could incorporation as a village lead to lawsuits?
Yes. For example, in 1991, when the Village of Airmont incorporated in Rockland County and enforced strict zoning that kept out a growing Hasidic population, it was sued by the federal government and some Hasidic groups, who accused the village founders of trying to zone out Hasids. The village was forced to change its zoning.
But, says Benjamin, even this can work in favor of a village.
The petitioners would find themselves caught up in legal wrangling with the village government, which could be time-consuming and expensive, he said. That might persuade them to look for land elsewhere.
The village, on the other hand, could mobilize its resources to hire a lawyer to fight the lawsuit – an expense a volunteer group, such as the South Blooming Grove Homeowners' Association, could ill afford.
What are the drawbacks?
Another level of government. More taxes. More red tape.
"Generally it's a bad idea, no matter how you slice it," says Mike DiTullo, president of Mid-Hudson Pattern for Progress, a non-partisan public policy think tank.
There are too many local governments in New York, he said. "If you add up the cost of the county government and the cost of 40 municipalities in Orange County, it comes up to over $1 billion. That's why our taxes are so high."
DiTullo brushed aside concerns about growth. "Orange County is growing at a rate of 1 percent a year. It's not an explosion, by any means."
Benjamin, however, thought concerns about density and rate of growth were "genuine."
But, he said, "a government should be formed for affirmative reasons rather than defensive.
"I think the responsible thing for the town and county government to do is act as mediator to resolve the conflict, rather than let another whole level of government be formed."