Town Votes to Evict Country School

Waiting for option to buy, founder instead gets rent increase of $73K a year
The Country School in Wainscott, founded by Deena Zenger, seen here sitting with students, received an eviction notice from East Hampton Town this week. David E. Rattray

Citing a lack of agreement on the terms of a new lease and a lack of rent payments, the East Hampton Town Board voted last Thursday to evict the Country School, a private preschool, from the land in Wainscott it has leased from the town since 1998.

The town claims the Country School’s original lease has lapsed and that negotiations on a new lease have been unsuccessful. But Deena Zenger, the founder and operator of the school, says that, following the terms of her original lease, which included an option to purchase the property where Ms. Zenger built her school, she duly informed the town in 2012 that she wanted to exercise an option to renew.

The site on Industrial Road is part of an industrial park established by the town decades ago to provide space for local businesses to rent at nominal cost. It is technically part of the East Hampton Airport property, according to the Federal Aviation Administration.

The federal agency put the town on notice years ago that accepting low-cost rents for the properties and placing that revenue in the town’s general fund did not comply with regulations. Fair-market value rent must be charged, the F.A.A. said, and the money must go into the airport fund. In addition, the F.A.A. said the town lacks the authority to sell off any airport land without its approval.

While Ms. Zenger has been paying in the neighborhood of $3,000 a year in rent, the new lease being offered by the town calls for $76,000 in annual rent, with no option to purchase the site.

Several new leases recently approved by the town board call for similar market-value rents. A hearing will take place next Thursday night on leasing a 2.5-acre industrial park site to a limited-liability company called HTO East Hampton Distributors for $90,000 a year for a 20-year term, with two five-year renewals.

According to Town Supervisor Larry Cantwell, the town has also applied for F.A.A. approval on behalf of two other businesses in the industrial park that had also been given options to buy in their original leases, and have informed the town they wish to exercise that right.

In a letter issued this week to parents of children who attend the Country School, Ms. Zenger claimed that “the town entered into an illegal lease agreement with me and I was not aware of it at the time. The F.A.A. (Federal Aviation Administration) has jurisdiction over all of the lots on Industrial Road and the town never got their approval for my lease. According to the F.A.A., these lots were never intended to be sold. So instead of the town taking responsibility for their mistake, they are trying to say I never renewed my original lease, therefore withholding my right to now purchase the land.”

“Why would I construct this $2 million building on property I would never be able to buy?” she asked in a phone interview yesterday. “I’ve worked my whole life to build this.”

According to the town, Ms. Zenger’s original lease, with the option to purchase the property, has expired, as she failed to renew it in 2013 at the end of the original 15-year term. “She’s in the unfortunate position of not having a lease,” Mr. Cantwell said on Monday. The town, under the F.A.A. edict, is unable to offer the original terms.

But Ms. Zenger said she duly informed the town in writing before the deadline with a letter delivered by hand to Town Hall, and has provided officials with a copy of that letter. The former school employee who dropped off the letter is willing to provide an affidavit to that effect, she said.

“The board would love to negotiate in good faith with the Country School. They’ve been there for a long time; they provide a good service,” said Mr. Cantwell this week. “It’s just a matter of coming to an agreement within the constraints that the town has with the F.A.A.”

But, he said, “there really has not been any movement to conclude that the Country School was negotiating with the town. We were left with no choice but to put them on notice. We take this action reluctantly, but seriously,” he said.

“We would like to work with her because we value the service the Country School provides, and the local people they employ,” Councilwoman Kathee Burke-Gonzalez said on Tuesday. She said town officials had met with Ms. Zenger “at least twice,” in April last year and in January.

The town, Ms. Zenger told parents in her letter, has “acknowledged that they would not enforce” the eviction notice while the situation plays out in court. The worse-case scenario,” she told parents, “is a judge rules in favor of the town . . . and that I am stuck paying an exorbitant amount of money for the lease of a property I will never own.”

“All that being said,” she told her students’ families, “the Country School is not closing, nor will it be closing at any time in the next few years.”