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Deputy Mayor Admits Full Blame For Rivington House Fiasco

By Allegra Hobbs | September 30, 2016 10:39am | Updated on October 2, 2016 12:31pm
 First Deputy Mayor Anthony Shorris was grilled for two and a half hours at a City Council hearing on Rivington House.
First Deputy Mayor Anthony Shorris was grilled for two and a half hours at a City Council hearing on Rivington House.
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Official NYC Council Photo by William Alatriste

MANHATTAN — Deputy Mayor Anthony Shorris got a two-and-a-half hour grilling on why a nursing home for HIV/AIDS patients was allowed to become a luxury condo.

The City Council session Thursday was held to look at why the Lower East Side's Rivington House facility, which should have been protected by deed restrictions, was allowed to be replaced by homes in exchange for a $16.1 million payment.

The hearing would have been longer if the council had not been mistakenly informed that Shorris needed to catch a plane to Oklahoma.

Council members at the hearing dug into Shorris' communication with colleagues leading up to the scandal, and asked how the Department of Citywide Administrative Services — the agency that oversees deed restrictions — was never told that the building should remain a nursing home.

"What is accurate is we did not have a sufficiently rigorous process to ensure deed restriction actions were rigorously enforced," said Shorris, adding the Mayor is trying to introduce new rules for handling restrictions to make sure it doesn't happen again.

Shorris admitted that while he told some staff members of his preference for the building to remain a nursing home, he simply assumed that desire would be communicated to the right people.

He failed to follow up with former DCAS Commissioner Stacey Cumberbatch, he said.

As a result, DCAS last year agreed to lift two deed restrictions on the property — one that stated it had to maintain a non-profit status and another that ensured it operated as a healthcare facility — at the request of then-operator Allure Group, which paid a fee of $16.1 million.

Three months later, Allure sold the home to Slate Property Group which planned a condo conversion.

And while Allure misled city officials by saying it intended to operate a for-profit healthcare facility, only one of the deed restrictions had to be lifted to allow that use. Yet DCAS scrapped both.

Shorris admitted he didn't explicitly tell DCAS to lift just one of the two deed restrictions. 

Councilmember Vincent Gentile said he found Shorris' explanation difficult to swallow.

"Why not just pick up the phone, tell DCAS to remove the not-for-profit restriction, keep it a healthcare facility, and move on?" he said

The real problem, Shorris said, was the lack of a formalized protocol for dealing with deed restrictions. There were few checks and balances in place to make sure changes were right for the community, he said.

Council members also questioned Shorris on a handful of Rivington-related memos from DCAS he claims he never read, saying usually important matters were communicated with a phone call. 

While Shorris claimed ignorance of Allure's plans for the site, a report from the Department of Investigation found at least some DCAS officials knew.

Allure reps explicitly told department officials months prior to the deed lift that they were considering a luxury condo conversion, the report revealed.

But Cumberbatch was not questioned at the hearing. She had left the department shortly after the deed lifts to take a new job at the city's Health and Hospitals Corporation.

"Ultimately, the responsibility for an error like this has to be mine," Shorris said.

In addition to the DOI's investigation, the deed fiasco has been probed by Comptroller Scott Stringer, who concluded city officials' "passive and unquestioning" approach led to the loss of Rivington House.

U.S. Attorney General Preet Bharara is currently looking into the matter, city officials confirmed at the hearing.

Officials said Shorris would have been questioned even longer — were it not for another  miscommunication between the mayor's office and the City Council.

Council member Kallos told those present at the hearing that he agreed to limit Shorris' questioning to two-and-a-half hours because the mayor's office told him that Shorris had to be on a plane to Oklahoma for a mayoral conference the same day.

But Shorris said he was not going to Oklahoma and added that he had no idea why the City Council got that impression.

Kallos said he found the misinformation "disturbing." The city council later released a statement on the matter.

“The administration misled the Council and the Speakers Office into believing that First Deputy Mayor Shorris’ availability for the hearing this morning would be limited because of events related to the U.S Conference of Mayors in Oklahoma City. This turned out to be false," said the council's communications director Eric Koch.

"At a hearing which focused on government honesty and transparency, this is particularly shocking  and unacceptable.”

The Mayor's office, fired back with its own statement.

“The Administration has always been crystal clear that Tony Shorris’ time today was limited due to his role as acting Mayor in New York City during Mayor de Blasio’s short trip to Oklahoma," mayoral press secretary Eric Phillips said.

"Mr. Shorris testified for two and one-half hours, answering dozens of questions on this matter. The Council owes Tony Shorris an apology.”