Good Profit Works extends New Rochelle Armory deal by not signing Letter of Agreement

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NEW ROCHELLE, NY -- Four months after the New Rochelle City Council selected Good Profit Works as the winner of a Requests for Proposals (RFP) for the New Rochelle Armory, the City has yet to sign any sort of agreement with the organization or receive the $50,000 escrow payment required under terms of resolution passed by the Council in November.

The matter appears likely to come to a head at the next City Council meeting on February 12th as a majority of Council Members have expressed concern that a deal has yet to be signed.

In response to an RFP for the New Rochelle Armory, Good Profit Works proposed a combination farmers market and restaurant.

The RFP distributed last May originally called for a Memorandum of Understanding (MOU) to be signed by the winning bidder. There were two bidders, Good Profit Works and the Veterans Memorial Center for the Performing Arts.

At the September 21st City Council meeting, the City Council selected Good Profit Works on a 5-2 party line vote and directed City staff to work with Good Profit Works to develop an MOU to presented to City Council at the October meeting.

That never happened.

Mayor Noam Bramson pushed the vote through over the objections of the veterans. In defending the move, Bramson delivered prepared remarks dismissing the concerns of the veterans by citing the importance of following the established RFP process.

Since then the established RFP process has been abandoned to the benefit of Good Profit Works. Rather than a Memorandum of Understanding, City Council was presented with a Letter of Agreement (LOA) to sign a Memorandum of Understanding six months after signing the LOA. The LOA required Good Profit Works to deposit $50,000 in an escrow account at the time it signed the LOA.

That never happened.

At the time of the September 17th vote to designate Good Profit Works as the winner of the RFP, then-outgoing Development Commissioner Michael Freimuth said his recommendation for Good Profit Works was based on his assessment that the Good Profit Works source of funds was more sophisticated and identified individuals who were more sophisticated in the art of fundraising.

Freimuth said the question to ask is "Are your sources real and can you really get out those sources?"

Since then Good Profit Works has been unable to raise even the $50,000 escrow money for their proposed $26 million project.

The MOU deadline for October was pushed back to November. At the November meeting it was disclosed for the first time that Good Profit Works would sign a Letter of Agreement to sign an MOU six months after signing the LOA and putting $50,000 in an escrow account.

That never happened.

The Letter of Agreement was not delivered to the Council until just moments before the vote on November 13th. Corporation Counsel asserted that there was no significant difference between an LOA and an MOU and that the delay in drafting the LOA with Good Profit Works was caused by power outages in the wake of Superstorm Sandy. Council had directed staff to negotiate an MOU two months before the storm struck. City Hall did not lose power or Internet service during the storm.

The failure to sign a deal of any kind with Good Profit Works came to light after Talk of the Sound pressed a standing request for a copy of the executed copy of the Letter of Agreement and a copy of the $50,000 check or wire transfer.

"The Letter of Agreement has not been signed to date," admitted City spokesperson Kathy Gilwit. "As a result it is not executed and there has been no check delivery."

City Council Members are aware of the failure of Good Profit Works to sign the LOA.

"I am somewhat concerned that the City has not received the Letter of Agreement and the check," said Council Member Shari Rackman. "It is something I intend to bring up at the next City Council Meeting."

Rackman was the only member of Council to thoroughly review the last minute resolution under which the LOA was approved. She noted that the language in the resolution stated that the escrow money did not have to be paid until the MOU was signed which contradicted what Council had been told, that the escrow money was to be paid upon signing the LOA.

Despite agreeing to make the change, the City has yet to provide Talk of the Sound a corrected version of the resolution despite numerous requests over the past several months.

City Manager Charles B. Strome does plan to discuss Good Profit Works at the next City Council meeting if no deal is completed by February 12th.

"We are waiting for them to execute the document," said Strome. "If we do not receive an executed copy by the next City Council meeting we will inform the Council."

Council Member Ivar Hyden remains somewhat optimistic a deal can be reached.

"I am disappointed that we have not to date received the signed agreement together with the escrow funds," said Hyden. "I remain hopeful however that the City will receive both.

The two Republicans on City Council, both of whom voted against the Good Profit Works deal, feel vindicated in casting their vote.

"We agreed as a Council to give them the OK for an agreement in October," said Council Member Albert Tarantino. "Now it is the end of January and we have not heard from them about signing it."

Council Member Louis Trangucci agreed.

"They did not want to sign an MOU," said Trangucci. "Now they don't want to sign an LOA. This indicates to me that these are not people the City can partner with on the Armory."

Tarantino is out of patience with Good Profit Works.

"They have had enough time to decide," said Tarantino. "It is only a Letter of Agreement and their failure to sign raises a concern in my mind that it is the financial issue that is holding things up suggesting this project is too big for them to handle."

Both Tarantino and Trangucci noted a degree of hypocrisy from Mayor Bramson.

"This is not about favoring one group over another," said Tarantino, "but about holding everyone to the same standard."

"My feeling is that we need to move on," added Tarantino.

Trangucci agreed.

"Good Profit Works is not being held to any sort of process or timeline," said Trangucci who noted that the Mayor has repeatedly criticized the Veterans for even the most trivial issues while ignoring the rather substantial failures of Good Profit Works despite substantive changes and accommodations given them during the RFP process.

Trangucci sees something deeper at play.

"The Mayor has never supported our veterans"," said Trangucci. "Maybe the time has come that the Mayor, for once, gives the veterans fair treatment."

Commenting on this Blog entry is closed.

OldTimerNR on Thu, 01/31/2013 - 23:13

He's pulling out in lieu of something else. Good profit is not what he's in business for.

NewRoNorthEnd on Thu, 01/31/2013 - 22:24

Remember that televised council meeting in the good old day of over 14 mou's with Capelli. The Mayors stern famous quote,"PUT UP OR SHUT UP " aren't we suppose to remember the past or we are condemned to relive it. Come on Mayor , PUT UP OR SHUT UP

NRVET on Thu, 01/31/2013 - 21:37

O.K Mr Mayor and our entrusted City Council Members. What do you do now?? You have a group of people who should have never gotten the nod to take over our Armory to begin with, but they did. The Mayor used the excuse that he had to uphold the terms, rules/regulations,guide & timelines to keep it fair for all. Now the Mayors own personal group of political contributors are having a tough time putting their money where their mouth is. Isn't that crazy. If the Mayor continues to support this group after bending over backwards and giving them advantages again and again (sound familiar) then our City Council better stand up for what is right!! I Hope Mr.Tarantino and Mr. Trangucci put it on the table and I hope they both convince Mr. Hyden and Mrs.Rackman to join them & do the right thing for NEW ROCHELLE. Expel "Good Profit" for not meeting the requirements agreed upon earlier in the process. The ONLY option is to bring back the NR Veterans with their NR Oprea partners and lets make it happen once and for all. The Portchester Capital Theatre is a huge sucsess in itself, but it is also inspiring the surrounding community. Why is it always Mt.Vernon, Portchester, Yonkers and White Plains getting all the goodies. Our time has come and the people of this Once Great City deserve better than what your dishing it Mr Mayor.
Mayor Bramson, the time has come to remove the knife in the backs of our Vets and let us show you how to get things done.

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