Formation-Shelbourne, the $2 billion investment fund that builds private assisted living facilities, last month sued the Town of Greenburgh’s litigation-prone Town Board – just as it threatened it would – for rescinding a controversial “negative declaration” that found Shelbourne’s application to build a 94-bed assisted living facility in Edgemont nearly a mile from where such use is permitted under the Town’s Zoning Code posed no significant environmental impacts worthy of study.

The Edgemont Community Council learned of the lawsuit today even though it had been filed on August 18.   Greenburgh’s town officials, who were publicly threatened with a lawsuit at a town board meeting August 4 by Shelbourne principal James Kane, never disclosed that any lawsuit had been filed.

The “negative declaration” had been issued by the Town Board on June 8 and was rescinded on July 19.

The rescission came after Shelbourne had filed a lawsuit against the ECC, the Council of Greenburgh Civic Associations, and 17 area residents over the July 4 weekend for having successfully obtained a ruling from the Zoning Board of Appeals that Shelbourne’s project required variances. The ZBA was also sued.

Shelbourne voluntarily dismissed that lawsuit after the ECC threatened to bring an anti-SLAPP lawsuit against Shelbourne for using litigation to punish members of the public for exercising their First Amendment rights. SLAPP stands for Strategic Litigation Against Public Participation.

Town Supervisor Paul Feiner claimed credit for getting the lawsuit dismissed but Mr. Kane said August 4 that town officials like Mr. Feiner were among those responsible for the suit having been filed in the first place, and town attorney Tim Lewis has publicly admitted town officials were told in advance by Shelbourne that Town civic groups and private citizens would be sued before any suit was brought.  Town officials never warned anyone that the lawsuit would be filed, which suggests they may have been complicit in its having been filed.

Mr. Lewis has also publicly admitted that in his opinion the Town Board acted improperly when it rescinded the “negative declaration” — an admission that suggests that the Town may not be in a position to adequately defend the legal interests of Edgemont residents  who may be impacted by Shelbourne’s latest lawsuit if the Town does not act promptly to get it dismissed.

In the meantime, Shelbourne has announced that two of its assisted living facilities, including its 100-bed facility in Roseland, New Jersey, for $98 million to an undisclosed buyer. The Roseland facility opened in 2013.

It is not known why Shelbourne, which was touting the Roseland facility as an example of what it planned to offer in Edgemont, had suddenly sold the facility – the sale actually took place on July 12 – or why Shelbourne, which discussed the Roseland facility when it appeared before the Zoning Board on August 11, never mentioned that the facility had just been sold, why it was sold, whether it was selling the facility at a premium or a loss, why it wasn’t disclosing who the buyer was or whether Shelbourne’s intentions in Edgemont were to do the same thing – provide all manner of assurances to get the permits needed, and then sell the property as soon as the facility becomes operational with no assurance that any of its assurances will be honored.

Shelbourne was using the “negative declaration” that the Town Board had issued in order to bolster its application for variances that was pending before the Town’s Zoning Board of Appeals.

According to Shelbourne, Greenburgh officials had secretly agreed years ago behind closed doors to support its application to build in Edgemont and Town Board’s issuance of that “negative declaration” was pursuant to that agreement.

More than 230 Edgemont residents had signed a petition opposing issuance of that “negative declaration” because the Town had failed to study the impacts on noise and quality of life as a result of an estimated 100 or more emergency medical vehicles per year having to travel at high rates of speed through a residential neighborhood along Underhill Road and its notorious hairpin curve to get to and from the facility which was to be built at the site of the Sprainbrook Nursery at the corner of Underhill and Sprain Roads.

In it lawsuit, Shelbourne claims that Town Board acted unlawfully in rescinding the “negative declaration” because it claims the Town did not have the legal authority to change its mind and because the Town allegedly failed to give Shelbourne notice and an opportunity to be heard that the declaration was being rescinded.

In fact, the public was given notice of the proposed rescission and several residents argued at a town board meeting where the matter was discussed that the Town Board’s action might create legal problems. The Town Board then put the matter over to consider whether that would be the case and, on July 19, the Town Board voted to rescind.

The Town Board’s stated rationale for rescinding the negative declaration when it did was that the need for variances meant that the Zoning Board – not the Town Board – would be the principal decision-maker on whether the project would get the green light and as such should be responsible for conducting its own environmental impact analyses that state law requires.

The town board did not explain why, if that was indeed the reason for rescission, it granted the “negative declaration” in the first place since the need for variances had been well established before it took that action.

ECC president Bob Bernstein said the latest Shelbourne lawsuit should never have been filed and, unless town officials are in cahoots with Shelbourne, which is entirely possible, it will almost certainly be dismissed.

“You cannot sue a municipality unless you’ve suffered some kind of loss of a property right,” Mr. Bernstein said. “Here, Shelbourne complains that the Town acted improperly in rescinding a negative declaration. But even if the Town did act improperly, it wouldn’t matter because Shelbourne is currently seeking variances which may still be granted by the ZBA, and which, if granted, would mean Shelbourne will have suffered no harm as a result of whatever the town board may have done with respect to the negative declaration. For that reason alone Shelbourne’s lawsuit is not yet ripe, ” he added.

Mr. Bernstein also said he was sure Shelbourne’s lawyers already knew before they filed the lawsuit that its action was not yet ripe.

“It’s one thing if the lawsuit was filed for the purpose of appeasing their investors,,” Mr. Bernstein said, “But quite another if it was filed in cahoots with town officials hoping to do an end run around the Zoning Board and its ruling on the request for variances.”

“The fact that town officials did not publicly disclose that the lawsuit had even been filed is worrisome here, because that, combined with what Shelbourne says was a backroom deal years ago in which town officials agreed to support its application, raises the possibility that the Town will not adequately defend the interests of Edgemont residents in this matter,” Mr. Bernstein said.

“The Town acted in a similar manner when it came to defending the interests of Edgemont residents in the Dromore litigation, in which a developer seeking to build apartments in a single family residential zone argued that the Town had improperly corrected its zoning map to prevent a developer from taking advantage of a map error that placed the parcel by mistake in a multifamily commercial zone,” he said.

“Here, it’s no secret that the same law firm that represents the Dromore developer is also representing Shelbourne,”   Mr. Bernstein said. “I don’t think that’s a coincidence.” he added.

The same law firm is now suing the group of Edgemont nuns that is seeking to enforce a restrictive covenant on their property that bars the construction of apartment buildings on lots adjoining theirs.  Mr. Bernstein is defending the nuns pro bono and the ECC is covering the out-of-pocket costs of that defense.

The Town has until September 25 to answer or otherwise move to dismiss Shelbourne’s latest lawsuit.  If it does not seek dismissal, Edgemont residents who may be adversely impacted by Shelbourne’s application may need to intervene in the legal proceeding on the ground that the Town is too conflicted to adequately represent Edgemont’s interests.


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