Syracuse firm wins legal battle with SUNY Poly real estate entity
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SUNY Poly’s Fuller Road campus in Albany. (Times Union Archive)
ALBANY – A state court has ruled against a real estate affiliate of SUNY Polytechnic Institute and ordered it to turn over money held in escrow to a Syracuse-area developer that built a $105 million semiconductor manufacturing facility for the state in Onondaga County.
The SUNY Poly entity, Fort Schuyler Management Corp. had set aside money from the construction contract to settle a dispute over the cost of the land that the state paid. The state’s main economic development agency, Empire State Development, legally had control over FSMC.
The developer, Cor Development Co. of Fayetteville, sued Fort Schuyler to withdraw $567,859 that was being held in escrow.
Two executives with Cor were convicted in the bid-rigging scandal and federal criminal case brought against SUNY Poly founder Alain Kaloyeros, although Onondaga County state Supreme Court Justice Deborah Karalunas asserted in her order Monday to release the funds from escrow that the criminal convictions and its outcome was not relevant to the case. She ruled that the state was correct in holding onto the escrow fund until her order, however.
Since the bid-rigging case began in 2016, New York state has revamped Fort Schuyler Management Corp. and another SUNY Poly non-profit called Fuller Road Management Corp. and replaced them with a new entity called NY CREATES, which oversees the real estate and economic development projects of SUNY Poly and other SUNY affiliates.
Kaloyeros, who was convicted and sentenced to more than three years in federal prison, has been free pending his appeal. So have the two Cor executives who were also convicted, Steven Aiello and Joseph Gerardi.
NY CREATES, which ESD created, is overseen by a new board and led by semiconductor industry veteran Doug Grose. The state insists that NY CREATES is legally separate from SUNY Poly, giving it the independence that the Fort Schuyler and Fuller Road entities didn’t have. ESD was also involved in the case.
“While ESD evaluates its next steps, it is pleased that the court found ESD acted appropriately by withholding the funds during the course of the litigation,” ESD spokeswoman Kristin Devoe told the Times Union.
“In the four years that Empire State Development has managed the FSMC/FRMC portfolio, we have implemented significant reforms that have resulted in greater transparency, oversight and accountability, and an improved management structure,” Devoe added. “Including the launch of NY CREATES, responsible fiscal management, additional research funding and lower vacancy rates, which has led directly to commitments of more than $4 billion in new investment and over 2,500 new created and retained jobs.”
Cor was originally hired to…
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