Canceled Fort Hancock lease in arbitration

Brookdale, Rutgers seek more space; Clearwater mulls return

BY LIZ SHEEHAN Correspondent

Rep. Frank Pallone Jr. (D-6th District) met with Barry Sullivan, superintendent of Gateway National Recreation Area, last week to discuss the future of Fort Hancock on Sandy Hook.

Their meeting followed the cancellation of a lease that had been awarded by the National Park Service to developer Sandy Hook Partners for at least 36 of the historic Fort Hancock buildings for reuse as commercial and educational facilities.

Pallone said the meeting was “very positive” and that the park service would do an analysis to determine the condition of the buildings included in the developer’s lease.

This would allow time for plans to be made by other interested parties, nonprofits or governmental agencies to look into locating at the fort in the buildings covered by the lease, Pallone said.

Pallone noted that some of the institutions already at the fort might be interested in expanding and using the buildings, including Rutgers University and Brookdale Community College, which already have a presence at Fort Hancock.

He said the park service would not need to go through a long process to lease the buildings to a nonprofit institution and could move ahead quickly with the leasing.

Pallone said he regrets that the lease between the park service and James Wassel, head of Sandy Hook Partners, was still in effect when stimulus money was being appropriated.

“The one time we were able to get it, we couldn’t use it [to rehabilitate the fort buildings],” he said.

But if a project that received recovery funds were to be canceled, Pallone said, there could be a possibility of using some of the money at the fort to rehabilitate the historic buildings.

“I’d like to see Sandy Hook as a park,” Pallone said. As for commercial use of the park, he said, “I want to rule it out.”

But he acknowledged that the park service is not of the same opinion and hasn’t ruled out another lease arrangement with a private developer. The National Park Service has cited a lack of funds to maintain and renovate the buildings as the reason for leasing them to a private developer.

Wassel has requested arbitration of the cancellation of the 60-year lease. In an email statement last Thursday on the arbitration process, Wassel said, “We are confident about the financing package we are submitting and are anxious for an independent third party to review it.”

Sandy Hook Partners’ separate lease for three of the buildings — the fort chapel, theater and former park service headquarters — remains in effect.

With the lease for the remainder of the development canceled, nonprofits and educational institutions are looking at the buildings with renewed interest.

Officials at both Brookdale Community College and Rutgers University said last week that they continue to be interested in expanding their presence at the fort.

Linda Millstein, Brookdale vice president of outreach, business and community development, said the college definitely wants to expand its facilities at the fort, but added that it is premature to discuss plans until the school knows what buildings are available.

The college “will be talking to the park service very soon,” Millstein said, and wants “to move forward to resolve its space needs.”

Michael P. DeLuca, senior assistant associate director of Rutgers’ Institute of Marine and Coastal Sciences, said Sept. 2 that Rutgers also wants to increase its space at the fort for classrooms, offices and laboratories. The university has the grant funds to support the expansion of its facilities, he added.

He said Rutgers is in discussions with the park service about its needs and that no decisions have yet been made. “All options are open,” DeLuca said

Referring to the arbitration process, he said, “Everyone is waiting again. We just want to move on.”

In July 2004, Millstein said Brookdale and Rutgers would share 5,000 square feet in a barracks building leased from Wassel. The two schools had signed a letter of intent with Wassel whereby they would use federal grant money for renovation of the space they would share. DeLuca said Rutgers had funds for the renovations but was required by the National Park Service to work through the developer.

“We have to do it this way,” he said at the time. “That’s the NPS’s agreement: if we want to access educational space out there, we have to work through the developer. We have to play by their rules.”

Board members of a nonprofit that occupied a building on Fort Hancock before losing it to the developer said last week they would welcome a return to Sandy Hook.

“I’d love to go back” to Fort Hancock, Edward Dlugosz, vice president of Monmouth County Friends of Clearwater, said.

But Clearwater, which occupied a house on Officers Row overlooking Sandy Hook Bay for 16 years, is “in a different place now,” he said. “The exile from Sandy Hook hurt our whole organization,” he said, affecting finances and membership.

Dlugosz was president of Clearwater in 1999 when the park service decided that the group’s proposal to rehabilitate its building had inadequate funding and instead placed the building under Wassel’s lease, forcing Clearwater to leave its longtime headquarters.

“We actually had a better plan than Wassel,” he said.

But he said the costs associated with renovating a building at the fort has shot up since 1999 and it could be difficult to raise funds.

Dlugosz said Clearwater had done extensive work, including plastering and repairing windows, on the building before it was forced to leave.

“In my mind, it was the best-maintained house out there,” he said.

Dlugosz said the Clearwater board would have to discuss the possibility of a move back to the fort and how to finance it. “We’d love to do it,” he said.

“We miss being at Sandy Hook,” Ben Forest, chairman of environmental policy for Clearwater, agreed.

He acknowledged that raising funds for a building renovation could be difficult.

“That doesn’t mean we won’t try it, and we may even be successful,” Forest said.

If Clearwater found a way to fund the work, it would probably put in a proposal to the park service to move back into the fort, he said.

In August the NPS canceled the 60-year lease it signed with Wassel in 2004 for the buildings, determining that the financing commitments made by Sandy Hook Partners “are insufficient to meet the purposes and requirements of the lease,” rendering the lease null and void.

The canceled lease contained a provision by which Wassel could request arbitration if it was terminated. Under the provision, the two parties have 10 business days after the request by the developer for arbitration to choose a mutually agreed-upon arbitrator.

The deadline for mutual agreement was Sept. 8, according to Brian Feeney, a spokesperson for the park service.

If they fail to agree, a request must be made by both parties within five business days to the American Arbitration Association to appoint a mediator.

The person selected must agree “to render a decision within thirty (30) days of his selection,” according to the lease.

The lease also says that the developer “affirmatively waives, not withstanding any statutory or other rights to the contrary that may exist, any judicial or other review of the decision of the independent third party or any rights to a third-party review of this matter under different procedures and requirements.”

This provision indicates that 10 years of controversy over the NPS’s choice of Wassel’s development proposal will be ended by a definite decision.

Since being selected as the developer, Wassel and the NPS have faced a legal challenge of the lease by Save Sandy Hook, a grassroots organization founded to stop commercial development on Sandy Hook.

Save Sandy Hook lost the court case on technical grounds, but criticism of the National Park Service has continued because the NPS granted a series of extensions of time to the developer to prove he had the necessary financial ability to pay for his proposal. Critics argued that proof of financing should have been provided at the time Wassel submitted a proposal, and that the NPS did not follow federal procurement regulations in selecting Wassel’s proposal from among more than 20 submitted for the Fort Hancock redevelopment.