With the stroke of a pen, Rob Astorino took the first step toward transforming Playland into a profitable, year-round destination, but the county executive may have ignited yet another feud with Democrats on the Board of Legislators.
Astorino announced Oct. 11 that Sustainable Playland Inc. (SPI), a nonprofit holding company based in Rye, would pilot the reinvention of the historic but downtrodden amusement park through a public-private partnership with the county ”“ ending speculation over the park”™s future following years of declining patronage and revenues.
Speaking to a crowd at the Playland Ice Casino, Astorino said the county could no longer afford to maintain the amusement park on its own.
“Playland is a government operation. That, in and of itself, is a problem,” he said. “There are many limitations to what we can do as a government entity ”¦ It”™s hard to make a case, especially in this time, that an amusement park is an essential service.”
Following the announcement, Astorino and SPI President Dhruv Narain signed a letter of intent to finalize an asset management agreement through which SPI would assume all responsibility for the park”™s management for a period of 10 years, with the county retaining ownership of the 100-acre park that hugs the Long Island Sound.
As part of the proposed agreement, SPI would make an upfront payment of $4 million and minimum annual payments of $1.2 million to the county.
Astorino and Narain said the two sides hope to have a contract finalized in the next 60 to 90 days, with construction then commencing on portions of the park.
SPI and its partners have also pledged to invest more than $34 million in private capital to enhance the park”™s historic rides, create a great lawn overlooking the Long Island Sound, build indoor and outdoor athletic facilities over a portion of the current parking area, renovate the Ice Casino to incorporate event and catering spaces while maintaining the largest of the building”™s skating rinks, transform the swimming pool into an aqua park for children and improve the beach and shoreline areas.
Narain estimated the proposed changes would result in the creation of hundreds of permanent jobs at the park itself, hundreds of construction jobs and many other indirect jobs as a result of the park being a year-round attraction.
“We plan to return Playland to its original vision of a park with amusements but a lot more, so that it can once again be a destination for all Westchester families,” said Narain, a Rye resident and former managing director of Goldman Sachs.
”˜Community-based solution”™
Sustainable Playland, which began as a grassroots coalition comprising Westchester residents and business leaders, has evolved into a coordinated effort involving planning consultants, developers, park operators, restaurateurs, sporting entities and entertainment providers from around the region.
SPI”™s operating structure resembles that of a holding company, with the group proposing to contract the management of the park and its components to Biederman Redevelopment Ventures (BRV) L.L.C., an internationally renowned management and design firm perhaps best known for transforming Bryant Park into one of New York City”™s most popular destinations.
Each individual component of Playland ”“ including the Ice Casino, the amusement park and proposed restaurant and events spaces, sports facilities and an aqua park ”“ would then be sub-contracted to companies that specialize in the development and operation of each venue.
“They had a vision and that was very important. It”™s a community-based solution; it had broad appeal,” Astorino said. “We were extraordinarily impressed with the management team and the operators that they were bringing in to work with them and reinvent Playland. That sort of put it over the top for us.”
Companies that have already committed to partnering with SPI include Mega Funworks Inc., based in Highland, N.Y., which owns and operates SplashDown Beach water park in Fishkill; DreamPark International L.L.C., based in Sugar Hill, Ga., which has participated in the design and construction of dozens of theme parks; American Skating Entertainment Centers L.L.C., based in Elmsford and Phoenix, Ariz., which operates 14 ice rink facilities across the country, including the Westchester Skating Academy in Elmsford; and Pinnacle Indoor Sports L.L.C., based in Prescott, Ariz., which has developed indoor and outdoor athletic facilities around the country, including the recently opened House of Sports in Ardsley.
Other area companies that have expressed an interest in partnering with SPI include the Pearl Restaurant Group, which operates seven restaurants in Westchester and Fairfield County, Conn., including three in Rye; and Restaurant Associates, a subsidiary of Compass Group North America, which operates catering services at more than 100 upscale locations across the East Coast.
Of the approximately $34 million in capital improvements projected by SPI, individual operators would implement roughly $25 million of the upgrades, with SPI responsible for the remainder.
The county and the individual vendors would then share in the profits, with Astorino saying SPI”™s $1.2 million annual payment to the county would be eligible to increase over the lifetime of the proposed contract as park revenues increase.
“This is a very rich deal for the county ”¦ I think he”™s (Astorino) done a very good job for the taxpayers,” BRV Principal Dan Biederman said, citing examples such as the redevelopment of Bryant Park, where the developer has retained all of the park”™s profits. “I think the county struck a good deal for itself.”
Astorino, board Democrats divided
The decision in favor of the SPI proposal marks the culmination of a years-long process that began in earnest in 2010, when the Astorino administration issued a request for proposals (RFP) seeking plans that would transform the Rye park into a profitable enterprise.
The county will lose more than $3.4 million on Playland in 2012, with revenues projected to be $12.4 million and expenses projected at $15.9 million ”“ including $3.9 million that will go toward paying off principal and interest on the county”™s existing $32 million in debt on the park.
Since 2010, revenues have fallen 4.6 percent and expenditures have fallen 4 percent as a drop-off in attendance hampered the county”™s ability to upgrade the park”™s current attractions and infrastructure.
For the 2012 season, attendance was 433,000, down more than half compared to attendance of 1 million in 2005, Astorino said.
Under the proposed agreement with SPI, the county would save $18 million in interest and principal payments over the remaining 12-year life of the bonds, he said.
While Astorino touted the partnership between the county and SPI as one that promises financial relief to county taxpayers, the Democratic majority of the county Board of Legislators questioned the math and criticized what they described as a lack of transparency on the part of the Astorino administration.
With annual debt service payments in excess of $3.8 million, Democrats on the board expressed their concern that county taxpayers could still be responsible for approximately $2.5 million annually after accounting for SPI”™s $1.2 million annual payment to the county.
“The details of this proposed agreement with Sustainable Playland to re-design and manage the park need to be in front of the Board of Legislators as soon as possible for the plan to move forward,” said Bill Ryan, a White Plains board member, in a joint statement released by the board”™s Democrats. “To fast-track this arrangement without board oversight and public comment would be the wrong way to go.”
Astorino said that because the proposed contract with SPI would be an asset management agreement and not a lease, the Board of Legislators”™ approval would not be required for the county and SPI to move forward.
Instead, he argued the only necessary approval in order for the contract to become legally binding would be from the county Board of Acquisition and Contract, a three-member board comprising Board of Legislators Chairman Ken Jenkins, county Public Works Commissioner Jay Pisco and Astorino himself.
“We want the Board (of Legislators) to be part of the process,” Astorino told the Business Journal. “What we won”™t allow to happen is for this to be bogged down in politics, bureaucracy and red tape for a long period of time, which would stall the project. People need to get back to work.”
