“We have not received a dollar of public support or tax incentives.” That’s what John King said in a full-page ad responding to my last op-ed about his Grapes and Greens operation.
On seeing the simple facts, most people would conclude this was not the truth.
#1— A half-million dollars from N.Y. State.
In February 2013, the Empire State Development Corp granted $500,000 “to defray the cost for leases to the [Grapes and Greens] facility for Long Island farms and wineries.” This money was paid to Long Island Farm Bureau, for use on its members’ behalf.
The checks for this half-million dollars of taxpayer funds weren’t made out to J. Kings, but the money ended up in their bank account all the same, in the form of rent payments from Farm Bureau.
This ag storage program looked promising and was worth trying…but it didn’t pan out. Despite the heavy subsidies and a big Farm Bureau effort, few took advantage of the deal. King planned 30,000 square feet for produce plus 10,000 for wine (totaling one-third of the warehouse), but used just 8,000 square feet combined. Only a handful of row crop farmers participated, and little or no “packaging and bar-coding” business materialized.
The failure of this plan seems to have prompted the cider option.
#2— Another quarter-million dollars via the IDA.
Industrial Development Agency tax breaks hadn’t been awarded when J. Kings claimed they received no tax incentives, but their IDA application was submitted long before, and there were signs this subsidy was predetermined. (This is true of nearly all IDA awards, and reflects problems with that agency…not with those seeking handouts.)
Granted last month, the IDA subsidy is valued at $262,514, according to the IDA executive director. That makes well over three-quarters of a million dollars in “public support or tax incentives,” received by a for-profit business owner who claims he got none.
What “support for local farmers?”
Apart from the use of public funds, one has to wonder: if J. Kings is as big a supporter of local agriculture as they claim, why don’t they promote it?
The Grapes and Greens website has a wine page with a “button” for New York wines…and one each for California, France, Italy, South Africa, Chile, Spain, and Brazil. Just one ninth of the page features New York wines. (There’s a “Cellar Selections” button, but these are all California wines…that state enjoys twice as much screen space as New York.)
It gets worse. Click on the “New York” button, and you’ll be looking at a page that lists only wines from the Finger Lakes…none from the North Fork. The craft beer page isn’t much better.
And there’s more. In his testimony to the IDA, John King described the giant pallet-sized plastic “bladders” he’ll use to transport apple juice to his cider plant. He then volunteered that this is the same kind of bladder he uses to deliver California wine to certain North Fork vineyards. More bad news for our “Grown on Long Island” ag economy.
Clearly, J. Kings makes money trucking wine and produce from the North Fork, trucking wine to the North Fork, and also from storing some wine and produce en route. It’s hard to see the company as a “friend” or “supporter” of North Fork agriculture.
How many “best uses” can there be? How many hand-outs for one property?
In 2012, John King said an agricultural storage and processing center was the “best use” for his huge Sound Avenue warehouse. He said it would be great for the community, and would help local farmers.
His pitch was good enough to land $500,000 in taxpayer money to get it going.
Just two years later, King said the best possible use is a cider bottling, tasting and visitor center. Then, he went to a different government agency and got another $262,000.
Along the way, King reminded us — often — how successful his business is. He employs 450 people. His payroll is $20 million. He handles more produce than anyone on Long Island. Yet, he never told us his annual profit, or his cash flow, or why he needs public assistance to make his business even bigger. (These are questions the IDA never seems to even ask.)
It’s great to see private business owners start new ventures when their plans fail…but to repeatedly take money from taxpayers — spent on the same property — is obscene.
#3—Walmart rent. Wait, what?
So far, we’ve just mentioned government subsidies; other taxpayer costs are just as real.
After King sued the town for blocking his cider operation, the town agreed — without public discussion — to break the long-standing site prohibition against manufacturing and retail sales, yet his lawsuit against the town stands. Why? King wants $73,807 in “damages.”
Damages require specific documentation; the $73,807 represents lost income from Walmart.
You might think: “Wal-Mart! This warehouse got a ton of taxpayer help to store produce for local farmers!” You’d be right… but that program didn’t thrive and occupied a tiny fraction of the building.
To maximize profit, King rented 60,000 square feet to Walmart for holiday gifts and supplies that overflow Walmart’s own warehouse for a few months each year. (That’s over half the entire Grapes and Greens facility.)
King argues the town improperly delayed his cider application, causing him to lose this income for the 2014 holiday season. But Walmart did not cancel its lease; King canceled it himself, assuming not only that his application would be reviewed quickly, but that it would be approved.
That was King’s choice to make. What’s offensive is the idea that taxpayers should compensate him for his bad judgment (on top of the subsidies “to support farming”).
The cost of defending this ridiculous lawsuit, and the cost of any settlement, will be borne by Riverhead taxpayers.
#4—Cost of policing prohibited events.
On April 7 this year, the Planning Board approved J. Kings’ Cider House plans, stipulating: “There shall be no special events such as weddings, festivals or fairs held on the subject property.”
Less than a week later, Grapes and Greens held a massive wine-tasting event that disrupted traffic for miles and required police presence. They shuttled guests from parking at Great Rock…but attendees’ cars still lined both sides of Sound Avenue near the facility. Residents couldn’t get in or out of their own driveways.
J. Kings ran a campaign to build attendance — estimated at up to 1,000 — but didn’t bother to notify the town or apply for permits.
The cost of the police response is on taxpayers, but that’s minor compared to the inconvenience and delays suffered by residents and through traffic.
Code enforcement didn’t arrive until after the event, and couldn’t write a violation…but if they had, it would have set J. Kings back just $250, a nominal “cost of doing business” on this scale.
It would be foolish to think their behavior will improve now that a tasting room and giant “snack bar” have been approved here.
#5—It’s still fake.
The problem which will cost most over the long-term, for taxpayers and legitimate ag businesses in both Riverhead and Southold, is that this is not authentic agritourism. It’s nuts that a “welcome center” to Long Island Wine Country — serving hot food, cold food, and with a fresh donut machine — is not on a farm and doesn’t focus on a crop for which our region is known.
Designed to catch tourists heading east, any success King’s Cider House has will come at the expense of established farmers growing their own grapes and producing their own wines (or apples and cider).
And with enough “pretend” agriculture, agritourism will diminish; the entire North Fork will suffer.
Why this is being allowed at all is a great question. Why we’re emptying our pockets — again — to help a successful businessman become even wealthier is another.
I suggest asking town board members to explain. And if they shrug and say “it was the Planning Board,” or “that was the IDA,” remember that they appoint the members and chairs of those agencies.
Moreover, it was the Town Board that reversed the planning/building director and the town attorney — both of whom knew this project shouldn’t happen — and allowed Grapes and Greens to move forward. This buck stops in the town boardroom.
Larry Simms runs a firm that licenses commercial flooring technology, owns a home in South Jamesport, and is a director of savemainroad.org, an advocacy group dedicated to preserving the character of the Main Road corridor and surrounding areas.
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