Despite the expired agreement, the town has continued to pay ORDA the annual sum the agreement requires. From 2005 to 2023, this amounted to $12.6 million in public funds and an $1.95 million more in state grants.

As town and ORDA officials hash out the details of a new agreement, the former chairman of the Lake Placid Sports Council — which was created to run the North Elba Park District and oversee a fund that disburses town funds to ORDA each year — is accusing the town and ORDA of “backroom” dealings and Open Meetings Law violations and calling for better transparency and public involvement in the process.

The town and ORDA may have violated the Rule Against Perpetuities, a law that limits the terms of bequests and leases, by not renewing its agreement when it expired. Legal counselors say that the current situation could leave both the town and ORDA “vulnerable” if either decided to no longer hold up its end of the bargain.

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Lapse

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The last agreement between the town and ORDA expired during former North Elba town Supervisor Shirley Seney’s tenure, from 1996 to 2007, according to former town Supervisor Roby Politi.

“We don’t have a legal lease with ORDA currently,” current town Supervisor Derek Doty said in a March 19 interview.

Politi clarified that the expired agreement is not a lease, but rather an “operational agreement” — though part of the agreement does include the lease of the town’s Olympic venues to ORDA.

It is unclear precisely when the agreement expired; Doty and Politi both could not recall an exact year and Seney died in 2015 at the age of 83.

ORDA Board of Directors Chairman Joe Martens said that, when the last agreement expired, the town and ORDA did not wish go through the process of renewing the lease repeatedly and instead agreed that the lease would, in effect, go on forever.

Doty said that the expiration was first brought to his attention in 2018, when he was a member of the town council.

Turnover in town and ORDA leadership has led both parties “to not pay attention to the lease,” according to Doty. He took office in 2022; before him, Jay Rand served as town supervisor in 2020 and 2021; and Politi from 2008 to 2019.

However, Doty and Rand were both on the town council before they were elected supervisor, and they both served as ORDA liaisons.

At ORDA, current President and CEO Ashley Walden was named as successor to Mike Pratt last August. Pratt took over as president and CEO from Ted Blazer in 2017. Martens was appointed chairman of the ORDA Board of Directors in 2022 by Gov. Kathy Hochul, succeeding Kelly Cummings, who was the board chair appointed by Gov. Andrew Cuomo following the death of J. Patrick Barrett, who led the board from 2011 until 2019. Martens also served as ORDA board chair from 2007 to 2011.

Doty and Politi both said that the town’s working relationship with ORDA has been so positive that renewing or renegotiating the agreement was not an urgent concern. Doty said that creating a new agreement will help future town councils; it was one of his priorities when he took office in 2022.

“For my peace of mind, I’d love to have a maintenance agreement or whatever we’re going to call it,” he said. “It’ll be something that future boards can work with the state of New York for years to come.”

When Walden became CEO at the end of this past September, Doty reached out to tell her about the expired agreement. Walden said that conversations about a new agreement began in earnest eight weeks ago at most.

Pratt and Blazer could not be reached for comment by deadline. Rand declined to comment.

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Vulnerabilities and perpetuities

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The deal between the town and ORDA for the agreement to go on indefinitely appears to have violated the Rule Against Perpetuities, a law that says a lease agreement cannot go on forever, according to ORDA board chair Martens.

“(ORDA and North Elba) mutually agreed that the lease would just go on forever, in effect,” he said. “I think they thought it was an elegant solution and they wouldn’t have to revisit it every year, and as it turns out, that is something that is not permissible.”

Though both parties continued to honor the agreement, there was nothing binding them to that agreement. Martens said there is a piece of paper he’s seen “somewhere along (his) travels” where the town and ORDA agreed to uphold the agreement, but that piece of paper likely wouldn’t be binding due to the Rule of Perpetuities.

Lawyer Mark Schachner — whose firm serves as North Elba’s legal counsel — said that the expiration of the town and ORDA’s agreement did not create significant “potential vulnerability.”

“From our perspective, as the town’s legal counsel, we’re not concerned about the existence of any potential vulnerability largely because the town and ORDA have been working cooperatively together for decades,” he said.

He added that, should the town or ORDA become “tremendously upset” with something and a rift between the two entities form, there could be some potential legal vulnerability.

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Payments

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North Elba pays ORDA every year to operate the Olympic venues that the town owns: the Olympic Jumping Complex, the Olympic Center and the James C. Sheffield Speed Skating Oval (co-owned with the Lake Placid Central School District). This arrangement originated under the expired agreement and has continued despite its expiration.

The amount that the town pays ORDA has varied over the years. The expired agreement requires the town to follow a formula that includes the amount paid in the previous financial year, adjusted by the North Elba Park District’s full tax assessment of real property. This formula is located in Title 28, the law that created ORDA in 1981. It can be viewed at tinyurl.com/2fh93hyb.

This formula has not been followed, at least in recent years. Doty said that, should the formula be followed, North Elba would currently have to pay ORDA somewhere in the ballpark of $2 million annually.

“That is not only ridiculous, but it would help drive this little town bankrupt,” he said.

North Elba currently pays ORDA $500,000 per year — a fraction of the payment the formula would dictate.

Before Doty took office, the town paid a higher amount annually to ORDA. He said he approached ORDA and lowered the rate to a flat $500,000 payment in 2022, since the town was no longer receiving state Department of Environmental Conservation grants. It is unclear if there is anything on paper regarding this agreement.

Prior to 2013, the town paid a variable amount to ORDA, according to a town document tracking ORDA payments since 2005, provided by North Elba Budget Officer Catherine Edman. Payments directly from the town, not including state grants, reached a peak of $902,645.02 annually between 2010 and 2012. Edman said the town and ORDA reached a verbal agreement in 2013 to pay a $750,000 flat rate. This rate was offset by DEC grants from 2015 to 2019, meaning that the town paid $500,000 to $600,000 from its own funds during those years.

Politi said this rate was a good deal for the community.

“The town of North Elba could never have managed the facilities or paid for the operation of the facilities,” he said. “We felt that $500,000 was reasonable at the time.”

In 2020 and 2021, there were no grants to offset the payment and the town paid the $750,000 in full.

When asked about this agreement, the state Comptroller’s Office, which is tasked with auditing and providing independent oversight over state and local finances, declined to comment.

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New terms

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The town and ORDA started the process of creating a new agreement in February. As a part of the new agreement, Doty requested that the $500,000 flat rate be formalized. For this fee, he asked that North Elba residents get certain benefits, like reduced admission to ORDA venues.

He also proposed to eliminate the agreement’s payment formula, which could significantly raise North Elba’s payments to ORDA. This formula is written into state law, however, and would likely require the state Legislature to pass an amendment. Doty says he hopes one of the options presented by the town and ORDA’s legal counsels is to ask the state Legislature for an amendment to the law that created ORDA.

“So much has evolved since the inception of that law that it’s not practical or realistic anymore,” he said.

Doty also asked for ORDA to bring back the Community Advisory Panel (CAP), a 19-member panel that is supposed to “advise and assist” ORDA by providing community feedback and identifying competitions to be held at ORDA venues. Doty said he envisions a different role for the CAP — or a CAP equivalent — going forward, should it return. He is pushing for the new agreement with ORDA to have a maximum 20-year term. He also wants to retain those three representatives chosen by the town of North Elba on the ORDA Board of Directors.

All of Doty’s requests already exist in Title 28, the law that created ORDA.

On ORDA’s side, CEO Walden and chairman Martens agreed with Doty and said the goal of the new agreement is to make sure that the relationship between the town and ORDA is brought up to modern standards.

Doty’s terms for the new agreement have been a source of conflict between him and former Lake Placid Sports Council chairman Jeff Erenstone, who resigned this month citing ongoing conflict with Doty over the town’s “backroom” renegotiation of its operational agreement with ORDA, among other reasons. Erenstone said he worries that approaching the state Legislature could result in the town having to pay more to ORDA.

Doty said he is not concerned about this happening.

“I think the state will recognize whatever both sides agree on to move forward,” he said.

Erenstone also disagrees with Doty’s approach to these terms, saying it’s redundant to ask for things that are already in the law. Doty said that the redundancies are on purpose, to ensure they’re enforced. When asked if they were not already enforceable, since they’re in the law, Doty said that’s a determination only the town and ORDA’s legal counsels can make.

The town expects a draft of the new agreement from counsel by May, June at the latest, according to Doty.

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Public feedback

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The divergent opinions came to a head when Erenstone resigned as chairman of the LPSC on March 12. He said that the negotiation of the new agreement was happening in a “backroom,” citing a Feb. 2 Open Meetings Law violation and private conversations between the town and ORDA that he alleged have been going on since October.

“They’re hoping to finish (a) first draft … without the public seeing anything,” Erenstone said.

Erenstone said the LPSC — which has legal input into the use of North Elba Park District funds, where ORDA payments come from — should have a role in talks about the new agreement. The public should also get a chance to comment, he said.

“If you’re using someone’s property, they tend to have oversight over you,” he said. “The public should help advise.”

He said that the town should go through a public hearing process with the agreement similar to the one it recently went through to develop its system of short-term vacation rental permitting.

Doty disagreed that the LPSC should be involved in the talks, saying that Erenstone thinks of himself as having powers over the town board. He said that he eventually plans to bring the public into the loop, not necessarily through hearings but rather through what he would call a “public awareness session.”

The town is not required by law to gather any public feedback on a new agreement, according to Mark Schachner, North Elba’s legal counsel. However, he said the town “welcomes public feedback on a regular basis” at its meetings, which could include feedback on the new agreement.

Former town legal counsel Ron Briggs said that, though he has not done any recent research on the agreement, he would’ve likely advised the town council to hold a public hearing.

“Hypothetically, if an agreement expired a long time ago and you want to enter a new agreement, I think you’ve got to hold a public hearing,” he said.

Walden said she was not opposed to gathering feedback from the public on the new agreement, though she wasn’t familiar with town protocols.

“It’s going to be a legal document that talks about the management of the town facilities and the reciprocal program for town residents, so I don’t have any concerns about that going up for public comment,” she said.