Luminati Aerospace, the company looking to buy the remaining vacant land at EPCAL from the Town of Riverhead, has been using and occupying both its facilities at the site without the required town permits, according to town building department records obtained through a Freedom of Information Law request.
The aerospace startup is also occupying its larger, Plant Six facility — where last week it held an event attended by more than 100 people, including various town officials — despite a stop-work order and notice of violation issued months ago by the Riverhead building inspector.
Riverhead Town Supervisor Sean Walter has been aware of the code violations and the stop-work order, but did not discuss them with the rest of the town board.
Chief building inspector Brad Hammond notified Luminati of “deficiencies” noted during a September 2016 site inspection at the former Skydive Long Island facility in EPCAL, where Luminati Aerospace has been headquartered since November 2015.
According to Hammond’s letter, alterations, including electrical work, had been made at the former Skydive facility without permits. Hammond also noted that using the space for manufacturing was a change of occupancy. He directed Luminati to make a commercial building permit application with an electrical application. Luminati filed a building permit application on Oct. 20, prompting a second letter from Hammond advising the company that the application, lacking “signed and stamped plans” was incomplete and could not be processed. The application was never completed, Hammond said.
In December, Hammond issued a stop-work order concerning violations at the 338,000-square-foot Plant Six building, a portion of which Luminati leases. The building is owned by Laoudis of Calverton LLC and is occupied by several businesses in addition to Luminati Aerospace.
The stop-work order was followed up by a notice of violation on Jan. 19, citing the building owner for a change in the use or type of occupancy without a certificate of occupancy and making renovations and/or alterations without the required permits.
Luminati installed manufacturing equipment and machinery inside the portion of the building leased from Laoudis of Calverton LLC without electrical permits. It also did not obtain a use permit from the town.
Walter acknowledged in an interview this morning that he knew Luminati Aerospace, which has offered the town $40 million for most of the vacant land remaining at EPCAL, did not obtain electrical permits. He said use permits are “somewhat irrelevant documents because the governing document on a piece of property is the C.O.”
The supervisor said he knew the building department had issued the stop-work order and notice of violation and thought the town had issued justice court summonses to Luminati on those violations; it has not. But Walter said he was the one who “dropped the dime” on Luminati. “I sent the building inspector there,” he said.
Walter, who has been an advocate of the land sale to Luminati Aerospace, was among a number of town officials who attended a large event held inside the Plant Six building June 16. Council members John Dunleavy, James Wooten and Jodi Giglio attended, along with Riverhead Community Development Agency director Dawn Thomas, and former CDA director Chris Kempner, who now heads up the Stony Brook incubator in Calverton.
Luminati cofounder and CEO Daniel Preston, who pledges to bring the aerospace industry back to Long Island, showed off and demonstrated the manufacturing equipment installed in the Plant Six space — including a carbon fiber layup machine used to manufacture aircraft that Preston said cost him $19.4 million. The event drew a substantial crowd, including a host of media; guests were offered food and refreshments following the speeches and a ribbon-cutting.
Walter defended attending the event held in a facility the town building inspector has cited for alleged illegal occupancy, which is subject to an outstanding stop-work order.
“At the time of the ribbon cutting, so — quite frankly… I was taken back when there were a couple hundred people there — or whatever they had, I don’t know 150 people. I expected there to be a ribbon cutting like we had at the tea shop, where five people show up,” Walter said.
Walter objected to the idea of an article being written about alleged violations at the buildings occupied by Luminati because the article should be about EPCAL as a whole, where there are numerous existing code violations on many properties, he said. An article solely about alleged violations at buildings occupied by Luminati would a “hit piece on Daniel Preston,” according to the supervisor.
“I get it — but I get it across all of EPCAL, with few exceptions such as Edgar Goodale [Riverhead Building Supply] but a lot of this stuff, because of the way it came into being, the paper trail’s not there. It should be. I’m not making excuses. It’s my fault it’s not there,” Walter said. The town has been concentrating its code enforcement efforts on “quality of life” issues, Walter said, pointing to litigation against the owners of short-term rental properties which have generated complaints from neighbors.
Luminati Aerospace did not respond to a request for comment.
Councilman Tim Hubbard and Councilwoman Jodi Giglio both said today they had no knowledge of any building department violations at either of Luminati’s buildings at EPCAL.
“I had no idea there was a stop work order,” Hubbard said.
“The board needs to know this,” he said. “Our department heads need to keep us informed. We must make sure this does not happen again. This is too big a project to not make sure we have the proper permits in place.”
Giglio said she would not have attended the event at Luminati last Friday if she had known there was a stop-work order on the building. Hubbard did not attend due to a prior commitment.
Walter said this morning he was going to direct the town’s special counsel negotiating the contract with Luminati’s attorney that the qualified and eligible hearing must take place before the end of August “or we will consider cutting them loose because we’ve got to move on,” adding, “They need to be ready to go, at the very latest, by the last meeting of August.”
Walter called RiverheadLOCAL back this afternoon to say he had given Luminati verbal notice that the qualified and eligible hearing must take place by the end of August. “My commitment to the town is to either have the public hearing by the end of August or there will be a termination of the LOI [letter of intent] because I’m not going to let this continue to carry on. We need to move forward,” he said.
The town executed a letter of intent with Luminati April 10, expressing the intention to sell nearly all of the remaining town-owned vacant land at EPCAL to Luminati for $40 million. The letter required the town and Luminati to begin negotiating a binding “definitive agreement” for the sale of the site. It allowed the parties 30 days to negotiate the terms of a definitive agreement “in principle.” It allowed either party to cancel the letter of intent if the parties were unable to agree on the terms within 30 days from the date the letter was signed by both parties.
Walter initially said he would not sign the letter of intent until after he met with Luminati’s financial backers, whose identities had not been disclosed. Last week, Walter said the purchase was to be bankrolled by Facebook but Luminati and the social media giant had “parted ways.” He said last week there was another prospective financier on the scene but did not know the entity’s identity.
He said this afternoon Preston assured him today that he has the money to buy the property.
But the financial vetting process has not yet begun. The supervisor said this morning that the town’s special counsel — attorneys Frank Isler and Michael Heller — had not yet begun the vetting process. “They are still negotiating the contract,” he said. “I know the attorneys have asked for documentation but I don’t think we’ve received anything yet.”
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