Westchester Terminates Rye Playland Contract with Standard Amusements
John Jordan | April 30, 2019
WHITE PLAINS—Westchester County notified Standard Amusements, LLC, which was scheduled to take over operation of the storied Rye Playland amusement park in November, that it was terminating the 30-year lease agreement reached in mid-2016.
Late last month, Westchester County Executive George Latimer reported he had reached the decision to terminate the Rye Playland 30-year lease agreement. The county has given Standard Amusements 30-days-notice of the contract termination, which will go into effect on May 28. The county’s decision to terminate the agreement was based on what the county termed as Standard Amusements’ failure to cure various “material defaults” under the contract that were spelled out in a letter from the county to Standard Amusements on Dec. 7, 2018.
While the county and Standard Amusements have been in negotiations regarding a number of contractual issues identified by the Latimer Administration last year, the two sides now appear to be on a clear path to settle the dispute in a courtroom.
“We are unhappy with the way this has all turned out; we never wanted this kind of conflict,” Latimer said. “However, we are simply not satisfied with what we have been seeing. We wanted to see the energy, excitement and drive in Standard Amusements’ vision for Playland—we didn’t want just a real estate deal.”
Latimer stated that Standard Amusements “was in material breach” of its contract with Westchester County.
Standard Amusements characterized Latimer’s action as “deeply disappointing and devastatingly false” and added that the decision was “nothing more than a means to improperly terminate a 30-year contract that was twice approved by super majorities of the Westchester Board of Legislators. It exposes taxpayers to hundreds of millions of dollars in losses from Playland’s extensive capital needs and needless litigation.”
The Westchester County Board of Legislators in May 2016 voted 13-4 in favor of the contract with Standard Amusements for a 30-year management contract of the 280-acre property. Those improvements were to include new rides and attractions, as well as upgrading food choices, picnic areas, and restaurants and renovating grounds and buildings. Westchester County agreed to spend $32 million for 11 capital projects to rehabilitate the infrastructure at Playland, including rides, gaming and concession improvements, as well as shoreline rehabilitation.
In its statement, Standard Amusements added that the Latimer Administration “has been negotiating in bad faith and, despite numerous requests, Mr. Latimer has been unwilling to meet with Standard Amusements since November 2018.”
The firm continued, “Despite Mr. Latimer’s mismanagement and complete disregard for visitor safety, Standard Amusements remains more committed than ever to restoring Playland to its former glory.”
Standard Amusements stated that it has worked for nine years and spent more than $10 million on its mission to save Playland. Westchester County notes that since receiving its December letter, Standard Amusements “has continued to claim expenses that do not qualify as part of the Manager’s Investment (including its legal expenses related to our negotiations), for a total of $7.7 million according to its last monthly report.”
“Standard Amusements has improperly claimed that it invested money in Playland, when in reality that money was not spent on purposes allowed under the agreement,” Latimer said. “Standard Amusements is wasting taxpayer dollars at the end of the day.”
Last May, Westchester County’s Department of Public Works/Transportation and Parks Department released a highly-critical report of the Standard Amusements’ contract that estimated the state of good repairs necessary at Playland to be $125 million. That estimate was far above the repairs called for in the Standard Amusement contract that require Standard Amusements to invest $27.5 million in capital projects (including $14 million for rides) and holds Westchester County to be responsible for $33 million in repairs, plus $9.54 million associated with the pool reconstruction.
The report stated the county could be responsible for an additional $65 million to as high as $95 million in additional capital costs, depending on investments made by Standard Amusements.
In its contract termination announcement, Westchester County cited a number of significant contractual issues that led to the decision to terminate the Rye Playland contract, including:
• Standard Amusements has improperly claimed millions of dollars as part of its contractually defined Manager’s Investment obligation, which is supposed to represent capital improvements at Playland.
• The county states that it is entitled to an annual audit of Standard Amusements’ books and records under the agreement; however, the county charges that Standard Amusements has prevented the county from completing the audit and has refused to provide necessary documentation.
Latimer states that the agreement has “Westchester taxpayers on the hook for $125 million, with Standard committed for $27.5 million. My job is to make sure Westchester taxpayers come first. The county’s relationship with Standard Amusements must come to a close. We cannot have confidence in Standard Amusements based on its actions. The company has not proven it has been serious about Playland succeeding,” Latimer states.
Members of the Republican caucus of the Westchester County Board of Legislators were highly critical of Democrat Latimer’s decision.
Minority Leader John G. Testa charged that the county legislature and the public were not informed of an additional $5 million offer from Standard Amusements made two weeks ago. “I am very troubled by the administration’s great efforts to avoid transparency and cooperation with the legislature in their plan to break the contract with Standard Amusements,” Testa said in a statement. “Along with returning to past practice of having complete financial burden for Playland Park, Westchester taxpayers face a very expensive and long litigation process that will end up costing Westchester millions.”