Fulton County

Fulton County Sheriff’s report criticizes county real estate deal but finds no criminality

Fulton County Sheriff Richard Giardino at his office in Johnstown on Thursday.
PHOTOGRAPHER:

Fulton County Sheriff Richard Giardino at his office in Johnstown on Thursday.

NORTHAMPTON – While not finding any criminal conduct, a report from the Fulton County Sheriff’s Office released on Thursday was highly critical of Fulton County’s 2021 purchase of land near the Great Sacandaga Lake for the purposes of building a museum and visitor center.

The report, following an investigation that Fulton County Sheriff Richard Giardino launched after receiving public complaints about the deal in November, concluded that the county overpaid for the 35.15-acre parcel, was not sufficiently transparent in its deal making and disregarded a provision in the acceptance of federal COVID-19 relief funding that requires projects not incur future costs.

For its part, the county maintains it got a fair price for the land and stands by the $1.2 million Great Sacandaga Lake History Museum project – which will include a visitor center, trail and lake overlook – as a future boon to county tourism revenue, according to Fulton County Administrator Jon Stead.

The sheriff’s report asks that the Fulton County Board of Supervisors put plans for the museum on hold until some of the raised concerns are addressed, but at this point there is nothing stopping the board from moving ahead with the project, Stead said.

Fulton County officials announced the county was buying the parcel in October using money from the $10.4 million in federal funding it received from the $1.9 trillion American Rescue Plan Act of 2021 (ARPA) passed by Congress and signed by President Joe Biden in March. The Fulton County Board of Supervisors voted 16-1 in August to endorse the “Destination: Fulton County” strategic plan for how to spend the federal funds, which included $1.2 million toward the construction of a new state-of-the-art museum and recreational facility to showcase the history of the modern engineering marvel that created the Great Sacandaga reservoir.

A central conclusion of the sheriff’s report is that the county overpaid for the land as a result of a rushed process that didn’t involve sufficient public input.

Fulton County purchased the more than 30 acres of land on State Highway Route 30 in the town of Northampton near the lake on September 30 for $520,000. The county justified the purchase price by using a 2016 appraisal of the land at $721,000, “with speculation by the county on the value of unapproved subdivisions,” according to the report.

The sheriff’s report indicates that the county relied on an outdated appraisal, according to the American Association of Appraisers’ standards, and overpaid. The sheriff’s report concluded that an appraisal of $350,000 would have been more accurate.

The report stated: “The county purchased the museum property for $520,000, which is arguably a substantial amount over the fair market value as measured by the 2017-18 Multiple Listing Service price, the value of the property as assessed on the County’s own website and the comparables as listed for the sale of properties in the area during 2021,” the report reads. “The only thing clear about the value is that it is unclear what the actual fair market value was in September of 2021. Therefore appraisals for the months surrounding the closing in 2021 would clear up this issue.”

Stead said the county supervisors have received the sheriff’s report, and they disagree with Giardino’s conclusion about the purchase price, especially since real estate prices have risen in recreation areas during the pandemic.

“When they made that purchase last year it was after several meetings to discuss it and discuss the value,” Stead said. “They looked at the appraisals they had and the documentation they had at the time. Putting those together they felt that the purchase price was reasonable.”

The sheriff’s report also questioned the speed of the real estate deal.

“The closing on the property occurred only 2 weeks after the resolution approving negotiations and purchase of the property,” the report reads. “Three buildings were condemned, leveled and the property cleared within a month of the closing. This is interesting because the buildings were included in the appraisal and listed as ‘average fair’ condition” the report reads.

Stead acknowledged the speed of the deal as a means to snatch up a desirable piece of land.

“It was in a good location for what the goals of this project are. So that part of it did move fairly quickly,” he said.

Giardino also criticized the county for using federal funding to pay for a project that may incur future costs.

The county allocated State and Local Fiscal Recovery Funds – part of the ARPA funding – to pay for the $1.2 million project. Such funds should “’not be spent on projects which would incur recurring costs’ without a revenue offset. A museum operation would necessarily incur recurring costs of staffing, operating and maintaining without a revenue offset,” the sheriff’s report reads.

However, the county maintains costs of the project will be offset by future tourism revenue, specifically in the form of occupancy taxes generated from hotel and motel reservations. Stead said the museum project is part of a three-pronged plan – including the $1 million Parkhurst Field Project and $8.65 million infrastructure-sewer corridor – to bolster tourism.

“The Board of Supervisors looked at this project as part of that plan, and that plan is to increase revenue through tourism,” Stead said. “This will be part of the tourism development program that we’ve been building right along. We hope to run a majority of the revenue through costs that we get through the tourism program and the hotel/motel tax.”

Regardless of future promises, residents are concerned about the way the deal was carried out.

“There was no public input into what to do with these funds, and I think people in the area were taken aback by the fact that there was no public input at all on how to utilize these funds,” said Bob Campbell, chairman of the Great Sacandaga Lake Advisory Council.

Stead, who said the public had the opportunity to weigh in on the project beginning with public hearings last June, acknowledged that some of the real estate negotiations occurred in private.

“The actual purchase of the property, that was something that had to be done partially in executive session due to the concern about the prices and the price escalating with too much notoriety,” Stead said.

As someone who grew up in the area, Campbell questions the priorities of the county leadership in building a museum and tourism center when the county has so many pressing needs.

“I just think that there should have been more community involvement, and at the end of the day I think there are much bigger fish to fry in Fulton County than to build a museum,” Campbell said.

Andrew Waite can be reached at [email protected] and at 518-417-9338. Follow him on Twitter @UpstateWaite.

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