According to its formation papers dated January 9, 1990, the Limited Partnership of Den Cass Associates inlcuded the general partners of The City of Newburgh Local Development Corporation; the “Community Development Group, Inc.” (signed by William Loewenstein, Director); Richard D. McGoey; William J. Hauser, and the limited partner of Sanford Ullman, M.D.
It was not always a happy partnership.
In November of 2003, Dr. Ullman brought suit against his partners, charging that he had
essentially been kept in the dark as to affairs of the partnership,” that the other partners had “failed to distribute the 24% of the net proceeds,” and had “wrongfully distributed to themselves funds which belong to Den Cass Associates,” and that the other partners had continued “to wrongfully withhold from the plaintiff [Dr. Ullman] information which is necessary for the plaintiff to determine the amounts to which he is entitled.”
According to the suit,
for at least since 1999, Den Cass Associates has operated profitably, with a positive net cash flow from the partnership business… on or about January 1, 2003, Den Cass Associates had approximately $450,000 in undistributed liquid cash, which far exceeds the operating cost or necessary capital for the operation of partnership business.
This hefty positive cash flow was being pumped in from the Newburgh School District.
From 1998 the School District leased Broadway School for use as a magnet elementary school with the theme of “Success for All.”
The leasing costs were heavy, as much as $544,650 annually in 2000 or $50,000 a month in 2003:
The district currently leases Broadway School, which it sold to the city in 1985. Board members lobbied hard for the bond issue, saying the district would save money by eliminating $544,650 in annual leasing costs.
It was the leasing costs which drove the Newburgh School District to consider buying back the school, and they put a bond to voters to attempt the school purchase in 2000. It failed by two votes:
The bond issue that would have let the Newburgh School District purchase Broadway School was defeated by two votes.
The final results of a second recount, approved by the school board Tuesday night, was 1,281 votes against the bond and 1,279 in favor.
Superintendent Laval Wilson said yesterday that the board will schedule a work session to discuss the results and decide what to do next.
Besides buying Broadway School back from a partnership that includes the city’s Local Development Corp., the $11.5 million bond issue would have paid for work at seven other schools.
The School District would have been paying $4.5 Million for the school that they had originally sold to the city for $150,000.
The elementary school closed in 2003, amidst concerns over student performances, but the district insisted it was a financial decision:
The district pays about $50,000 a month to lease the building and for amortized payments on building improvements. The embattled school remains on the New York State School Under Regents Review list for underperforming schools, despite having exceeded the test scores goal set for the students last year. “It’s not a performance issue,” school board President Peter Fogarty said yesterday, adding that it was a financial decision. “We haven’t got the deal that we wanted.”
As for the Unhappy Partner, Dr. Ullman presumably settled with the other partners out of court.
