Patrick Stewart, a resident member of the Board of Directors of the Roosevelt Island Operating Corporation (RIOC), has recused himself from participation in discussions related to the sale and possible privatization of Island House and Westview for “conflict of interest” reasons.  Stewart revealed his stance last week in a liaison meeting between members of the Residents Association (RIRA) Common Council and resident members of the RIOC Board held on April 22, 2004.

Stewart said, “If I have knowledge that could benefit me as a resident of Island House that the other residents of Island House don’t have, then that puts me in a position of straight serious conflict of interest potential.”

The question came up in the liaison meeting (the full transcript of which is available online at  http://nyc10044.com/wire/2416/liaison.html) because a potential buyer is negotiating with the current owner, and RIOC controls several factors that could determine the viability of a financial deal and its outcome for tenants of the two buildings – a ground-lease extension, ground rent, and any conditions that might be imposed as part of a ground-lease extension to protect the tenants.

Another resident member of the RIOC Board attending the liaison meeting, David Kraut, took exception to Stewart’s recusal.  “Look at it this way,” he said. “ The sale and possible conversion of Westview and Island House [and other buildings] is the most important single action facing this [RIOC] Board in its history and in its future.”

Stewart agreed, “No question.  Absolutely.”

Kraut continued, “Nothing else will have more effect on the shape of this Island and its future than this vote.  And I don’t understand how you can be a Director of this corporation and not vote that issue one way or the other, because in terms of conflict of interest, we all have conflicts.  You are always going to know more as a director about the actions, about the interior operation of this corporation on whose Board you serve, and you are always in a position to profit from your decisions.  What you may not do is profit in a way that other members of your buying public don’t have access to.  If you vote to take your building private because you happen to want to buy your apartment, you are allowed to do that and it is not a conflict of interest unless you get a better price than other people.  If other people in the building get apartments on the same terms as you have voted for, then it’s not a conflict of interest...  It is only a conflict of interest when you do something to your own benefit which is not equally shared among others.  

“You are setting up a hypothetical situation in which you will not vote on Westview/Island House, and I’m not going to vote on an Eastwood conversion for or against, and [two Rivercross residents who serve on the RIOC Board] Mark [Ponton] and Debbie [Beck] can’t vote on a Rivercross conversion, and [that's] not what we’re on this Board for.  We’re on this Board to take a stand one way or the other, for or against, based on our best assessments of what’s best for the community, and if in fact I might profit from an Eastwood conversion, so be it, so long as all of my neighbors have the same chance to profit.  And if I think we shouldn’t privatize, because I want to continue to rent, then all my neighbors will continue to pay rent and not have to come up with the [purchase] money.  And that’s the basis on which we decide...  I don’t see how you or anybody else can not vote on the most compelling issue this Island faces.”

Stewart responded, “I appreciate that. I appreciate your sharing.  I do not happen to share that opinion.  I do not read the State code of ethics law that way.  I do feel this is a conflict of interest, [and] until someone proves to me otherwise, in writing, from the State code of ethics, as long as I have a piece of information that my neighbors do not have and that I am not able to share, I do not [want] that piece of information.  It gives me an advantage, real or otherwise, real or perceived advantage, and I’m not going to put myself in that position, nor do I think that the oath I took as a director of this corporation or an officer of the State of New York, that I should do that.”

The discussion continued, briefly, with RIRA Common Council member Frank Farance suggesting that Stewart’s stand meant he would have to recuse himself from any decision affecting the Island, and Stewart responding, “I will give my opinion [and vote] as long as my special interests are not involved.”  Later, he added, “If it’s an Island-specific issue [being considered by the RIOC Board], I am for the Island, period.  If it’s a building-specific issue, which in this case is the privatization of these buildings, which I live in, then I have to take myself out of it, and hope to God that my representatives in RIRA will speak for me and speak to RIOC for me, because that’s what democracy is about.”

Earlier in the meeting, another resident Board member, Mark Ponton, told the liaison meeting that his understanding of the Westview-Island House sale and privatization process is that “there is a two-person subcommittee of the [RIOC] Board [non-resident member John Mannix and resident member Deborah Beck]...  The last time I was informed about it they were advocating, I think it’s a fair statement to say, minimum involvement by RIOC.”

Other matters discussed in the RIRA-RIOC Board Liaison meeting included:

•  Space for the Youth Center, which wants the Blackwell minischool space, but could lose $2 million in City funds unless it has a long-term lease on some space.  Mark Ponton said that an informal survey suggested that a majority of RIOC Board members would vote to give the Blackwell minischool space to the Youth Program, and that he would ask that the matter be put on the agenda for the RIOC Board’s May 13 meeting.  But, he said, getting the matter on the agenda apparently depends on the willingness of Board Chair Mary Beth Labate to have the Board consider it.

•  Island signage, which those attending the meeting agreed was sorely lacking, especially for first-time visitors.

•  Creation of an online problem-reporting system that would provide a central point for listing the Island’s physical problems, where RIOC staff could report their progress and resolution.

•  School bus pickups for Child School students, many of whom board buses at Island House, where multiple buses line up and stop traffic while the students cross Main Street without a crossing guard, and are then unable to line up on the curb because a yellow chain restricts them to the street where the buses stop.