Why did NYC schools pay $25 million for Nathan’s old hot dog site?

This story was originally published May 23 by THE CITY.

In September 2018, Lorraine Grillo, then head of the city’s School Construction Authority, received an email from her friend Carlo Scissura, from his email account as the leader of the New York Building Congress.

He asked if they could speak on the phone about the closing of a Nathan’s Famous restaurant in Dyker Heights, Brooklyn.

The conversation didn’t revolve around the hot dogs, but rather Scissura’s idea that the site could house a public school, according to the email and others obtained by THE CITY via a request from the Freedom of Information Act.

“The property is Nathan’s former site – 86 and 7th Avenue. The address is at 650 86th Street, I believe it’s 70,000 square feet,” he wrote in an email, telling Grillo the landlord was “ready to make a deal.”

“He would prefer to deal directly with SCA. Maybe you or one of your deputies can give it a first call and then pass it on to your team,” he added.

Scissura omitted two seemingly essential pieces of information. One, this “owner”, Tim Ziss, was under contract but had not yet purchased the site, which was still owned by Nathan’s Famous.

And Scissura never disclosed in emails with Grillo for three years — and never disclosed to city or state lobbying overseers — that Ziss had agreed to pay him thousands of dollars a month. .

Instead, Scissura presented himself solely as a local Bay Ridge benefactor. “Believe me, I don’t want to be involved in anything other than (sic) getting schools built in the best neighborhood in New York :),” he wrote to Grillo.

Ziss then completed the purchase for $12.25 million on October 23, 2018 — then resold the property for $25 million to Grillo’s public school building agency on July 1, 2019, according to public records , paid for by taxpayers.

Ziss did not respond to a request for comment. A spokesperson for Mayor Eric Adams’ office, speaking on behalf of Grillo, said she “always made decisions purely on the merits, and this situation was very clearly no exception.”

“At no time did Mr. Scissura reveal that he was being paid to discuss this project, and First Deputy Mayor Grillo was never informed of this arrangement,” the city hall spokesperson said. , Charles Lutvak.

“It’s lobbying”

Scissura was more than a household name at Adams Town Hall. Earlier this year, the mayor was about to appointing him head of the city’s powerful economic development corporation. After THE CITY in January first revealed Scissura’s secret work for Ziss, Adams then appointed another chief for EDC, Andrew Kimball.

While leading the Building Congress, a real estate and construction trade group, Scissura began working with Ziss in July 2018, according to a copy of the contract obtained by THE CITY.

In addition to a $15,000 retainer, Ziss paid Scissura $6,000 per month starting in October, according to the contract. The scope of work described included meetings with local leaders and elected officials regarding the development of five properties in Bay Ridge. The New York Building Congress staff and board were unaware of his sideline, according to people familiar with the matter.

The contract specifies that Scissura “will not act as a lobbyist as defined by New York State lobbying rules and will not act as an attorney on this project.” Scissura is not a registered lobbyist in New York.

But several experts who spoke to THE CITY said Scissura’s efforts to influence a real estate transaction fit a classic definition of lobbying.

Those actions include his complaining emails to Grillo, who is now the first deputy mayor under Adams.

“He’s asking a government official for action on something, that’s lobbying,” said a lobbying lawyer, who asked that his name not be used.

He pointed the municipal lobbying law, which prohibits any activity attempting to influence eight separate stocks. The list includes “any decision made by an elected official of the City, a civil servant or an employee of the City concerning the conditions for the acquisition or disposal by the City of any interest in real property”.

Under city and state lobbying laws, a person convicted of unregistered lobbying work faces civil penalties of up to $30,000, in addition to the criminal penalties associated with a class misdemeanor. A. The City Clerk declined to comment for this story and the state’s Joint Commission on Public Ethics (JCOPE) did not return calls.

Scissura continues to defend his work with Ziss.

“As I have said in the past, my friend Mr. Ziss asked me to consult on some properties, but I made it clear that I would not be the lobbyist for his organization,” he said. he said in a statement to THE CITY last week.

On Monday evening, Scissura’s personal attorney, Claude Millman, said: “We have reviewed the emails identified by THE CITY and dispute that they reflect any ‘lobbying’ which, in the circumstances, should be reported under law,” he wrote in an emailed statement.

“The law does not consider every communication with the government to be ‘lobbying’. To argue otherwise would require ignoring the detailed definitions and numerous exceptions of the complex regulatory regime.

Buy now!

In dozens of emails from September 2018 to February 2021 between Scissura and Grillo, he maintained a steady rhythm of inquiries about Ziss properties — without ever disclosing his own financial stake.

“He would prefer to deal directly with SCA. Maybe you or one of your deputies can give it a first call and then pass it on to your team,” Scissura wrote in an email sent on Sept. 22, 2018.

Scissura contacted Grillo about the site weeks later, with more urgency.

“I know he has other potential tenants and I don’t want SCA to miss any opportunities again,” he wrote.

In that same email exchange, Scissura suggested he contact Gayle Mandaro, who led real estate acquisitions for SCA. Grillo politely shot him down.

“Carlo you know I think the world of you but it wouldn’t be appropriate for you to speak with Gayle during the negotiation,” she wrote on Nov. 14, 2018. “I promise to follow up with her to find out the latest and get back to you.”

Build allies

District 20 in Brooklyn, which includes the neighborhoods of Bay Ridge and Dyker Heights, is one of the most crowded school districts in the city.

Scissura, a former member of the local school board, spoke openly about his involvement in building schools.

Throughout his emails with Grillo, he also mentions other Ziss-owned properties, including land at 7614 4th Avenue, that could be used for schools.

“Different part[s] from district 20 but also awesome,” he wrote in 2018. “Hoping someone can contact him.

And the emails show Ziss immediately moved to return the property.

“But[t] you should know that we are a few centimeters away from signing the contract on Nathan’s site! Grillo wrote to Scissura on January 4, 2019, just over two months after Ziss purchased the site. “Thanks for your help with this.”

Scissura continued after the deal was made with Nathan. In October 2020, he emailed Grillo about a possible school site in Bay Ridge. “The owner is really at his wit’s end (sic) with holding the site up” after other potential buyers showed interest, he wrote. It is unclear which site he was referring to.

“Can we shake things up and at least get him the contracts or even have your team … talk to him to get things done,” he wrote.

Demolition of Nathan’s old building was completed in late December last year and the school is expected to open by 2024, according to the city.

In late 2021, members of the New York Building Congress board of trustees anonymously received a copy of the contract between Scissura and Ziss, according to several people familiar with the matter.

The contract was also sent with a letter from a Congressional building insider expressing concerns about the arrangement, these people said.

In a board meeting, Scissura assured members that he was no longer working with the developer and was still in charge of the business organization.

Several members of the Building Congress board of directors did not respond to THE CITY’s requests for comment.

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