Halloween

The Village of Nassau always had a police department. When I was in elementary school, the police department was actually just one part-time constable, Will Harrington. Will drove a black 2 door Hudson, probably about a 1946 or 1947. It was Constable Harrington’s personal automobile. The car had a huge chrome siren with a red light in front perched on the driver’s side front fender, and a long whip antenna on the rear fender, as well as a spotlight installed through the driver’s door. I don’t believe it had a police radio since there were no other police cars, and the Village had no police station. Will’s police car looked more powerful and intimidating than the grey Ford sedans then driven by the New York State Troopers.

Halloween was a major holiday in Nassau. Local youths loved to go to Fauth’s cider mill on Lake Avenue to swipe apples from the open bins. “Trick or Treat” in those days meant something. Little kids didn’t go door to door with their mother. Halloween was the night that the older boys went house to house, raising a little hell, soaping car windows when the owners didn’t keep a watchful eye. The mean boys used candles instead of soap. Candle wax was much harder to clean off. Years before, Halloween was a night to tip over out-houses, but those had all pretty much gone from the Village by the time I was a child.

A big part of Constable Harrington’s job was to keep the level of mischief down. He would drive slowly through the Village on Halloween night, shining the chrome spotlight along the houses to check for mischief-makers. He would yell at the groups of boys to move along, an action that was frequently met with a barrage of the pilfered Fauth apples before the boys scattered into the shadows, only to reappear a few minutes later after he passed by.

Early one Halloween night, I think the last one when Will was Village Constable, he stopped by Frank Pitts’s General Store. Frank’s store was next to the Post Office at the corner of Church Street and Elm Street, where the antique store is now. Will went in to get a pack of cigarettes and shoot the breeze for a few minutes with Frank. He parked the Hudson in the pull-off by the closed Post Office but left the car’s engine running. When he came out a few minutes later, his Hudson was gone.

It was the grandest Halloween ever! Will was both enraged and embarrassed, as he walked around the Village looking for his car, and threatening every one of the older teenage boys and young men that he spotted. Word of the theft got out quickly, and it was an open season that night for apple stealing, apple throwing, and soaping and waxing windows. Some of the boys took advantage of the situation and even busted up Halloween pumpkins put out as decorations on some porches.

Halloween night eventually faded into November first, but there was no sign of Will’s Hudson the next morning. Poor Will had to hitch a ride to his regular day job that morning, and by the time he came home that evening everybody in the Village knew of Will’s plight and was ready to offer a theory as to who had done it, and where his car was. They say that Constable Harrington walked all around the Village that night, looking for his Hudson in barns, behind hedgerows, and wherever he thought it could be hidden, but there wasn’t a trace of it.

The next night, a little after seven, Frank Pitts called Will to tell him that the Hudson was parked in front of the Post Office with the engine running.

Wyatt shoots a dog

Sometime in the early 1950s, the Village of Nassau hired its first full-time police officer. C. Lowell Avery was as finely attired as any village policeman in the state. His grey uniform was impeccably tailored to his trim, 6 foot 2 physique. As the sole police officer, he naturally was the chief, and his uniform reflected his top departmental status, replete with gold braid, and “scrambled eggs” on the visor of his hat. He referred to himself as “Chief Avery”. He was frequently addressed as “Doc Avery” by some, but soon known to all as “Wyatt Earp.” The moniker, Wyatt Earp, was probably a compliment since during those years Hugh O'Brien played the legendary western sheriff on a popular television show. My father once reported hearing a young boy respectfully addressing Chief Avery as “Mr. Earp” at the Post Office.

Wyatt upheld the law. Nassau’s perceived problem was speeding. U.S. Highway 20 formed the main street in the Village, being Albany Avenue west of the single traffic light, and Church Street to the east. Cars and trucks entering the Village from the east descended Lord’s Hill for about a mile and a half, and usually entered the Village at a pretty good clip. The speed limit went from 50 miles per hour to 35 miles per hour to 25 miles per hour in a short distance, but it was not unusual to still be doing about 40 miles per hour when crossing into the 25 mph zone.

Wyatt would be waiting. He usually parked his new cruiser in the St. Mary’s Church parking lot and ticketed every speeder that he honestly believed exceeded the posted limit. There were many of them. The Village judge, James Lamb, was a retired New York City fireman with a lot of time on his hands, and he welcomed the Court activity that all of the tickets produced. The Village Trustees welcomed the added revenue it gained from its share of the fines. At the time, the Village judge held court one evening each week, but the court would always be in session at his home, and Wyatt would lead out-of-town speeders right to Judge Lamb’s living room, where they would be promptly fined and sent on their way. Nassau soon earned a measure of notoriety as a speed trap and was appropriately marked on AAA maps. Almost everyone who drove through Nassau had been ticketed by Wyatt or had a friend or family member who had been caught. The locals quickly learned to obey the speed limit, because they knew that Wyatt played no favorites, and he had no compunction about writing a speeding ticket for “26 mph in a 25 mph zone.”

I never got a ticket, but I was careful. I used to drive my father’s new 1956 pink and black Cadillac into the Village to pick up the mail, and I would put on the brakes to make sure that I was doing 25 mph or less. I sometimes played a little game with Wyatt. If he pulled out to follow me down Church Street, I would pace myself to have to stop at the traffic light. When the light turned green, I would floor the Cadillac so that it would chirp the tires, but then immediately back off on the accelerator so that I wouldn’t exceed the speed limit. Then I would go to the Post Office. Wyatt would usually follow me out of the Village at 24 mph unless he was in the process of writing a ticket for someone else.

By the time Wyatt was the chief for a couple of years, his notoriety grew. He seemed to walk taller, always wore mirrored Ray-Ban sunglasses, and carried a long-barreled .44 Magnum sidearm. He really was an imposing figure, and Nassau knew that it had a real lawman.

One Saturday afternoon, a pickup truck drove down Church Street. It had the green light and was moving right along. A dog ran out, unleashed, right into the path of the truck, and the animal was struck, severely hurt, but not killed. Wyatt was quickly on the scene, and a crowd of residents assembled, most of them coming out of the Post Office or Frank Pitts’s General Store when they heard the screech of brakes. The dog was whimpering, and after a brief examination, the consensus was reached that the dog should be put out of its misery. The dog’s owner, not wanting to make the dog suffer any longer than necessary, looked to Wyatt to do the job. With the crowd growing larger, and traffic backed up, Wyatt drew his .44 and fired. The bullet missed the dog and tore a chunk of macadam out of the payment. Wyatt shot again, and again he missed the dog. He seemed to be grimacing and looking away as he fired his revolver. A bystander, one of the local merchants, took the gun out of Wyatt’s hands, and dispatched the dog with one shot, much to the relief of everyone witnessing the event.

After that, things changed in Nassau. Young men who hung around the Gulf gasoline station on the corner started calling Chief Avery “Wyatt” to his face. Teen-aged boys barked at him and laughed. Wyatt seemed to lose interest in writing tickets, and the court revenue dropped off sharply. Then one day Chief Avery moved on to take a job directing traffic as a foot patrolman in Lake George, and it was ok to drive a bit faster through Nassau.

Chasing Speeders

Shortly before I became the Village Attorney of Nassau, the Board of Trustees appointed Martin Harrington as its police chief. “Marty” had been a policeman inthe City of Albany at one time, but I don’t think that he had risen in rank above patrolman in that employment. Marty was fairly good-natured, but a bit dumpy in appearance. His uniform was typical city policeman regulation blue, perhaps a carryover from his earlier job. It was a trifle too small and accentuated his growing belly. Marty did not wear fancy braids on his uniform or scrambled eggs on his cap, but he did wear 3 or 4 military general’s stars on his epaulets to reflect his status.
The Village fathers wanted their policeman to slow speeders, help the elementary school children cross Route 20, and be available to handle the occasional domestic dispute. Instead, they usually wound up hiring someone who wanted to tackle criminal investigations that would even stump Interpol. That was not the case with Marty. He was pretty low key. He wrote a few tickets, helped the kids cross the street, directed Sunday morning traffic when the churches let out, and generally did whatever the Village Trustees thought he should do. He was a pretty good fit for the Village. While nobody had a bad word for him, he didn’t command a great deal of respect, probably because of his somewhat disheveled appearance. Once Marty came to a meeting of the Village Trustees to complain that an out-of-town driver who he had ticketed had ripped it up and mailed to him, addressed only to “Marty, the Fat Fuzz, Nassau, New York”. He seemed most upset that the Post Office had matter-of-factly delivered it to him. The Village Trustees nodded their sympathy, but none shared his indignation.

Marty became friendly with Wilbur, a recent retiree from New York City who had worked as a lineman for Consolidated Edison. Wilbur had been a volunteer auxiliary policeman in New York, which meant that he rode around in a police car at night with a patrolman, but had no police officer status. The auxiliary policeman served a useful purpose, keeping the police officer company, providing “an extra pair of eyes”, and being ready to radio for help in an emergency. Although the village didn’t have a formal auxiliary police program, Wilbur started riding with Marty to pass the time. The Village Trustees were aware of this, but saw no harm, particularly since there was no expense. Wilbur even came up with a makeshift uniform, but he looked more like an aging security guard than a policeman.

During the 1960s the Capital District cities of Albany, Troy, and Schenectady experienced some racial strife. A group of young black men in Albany, leaders of that city’s protest movement, smashed some store windows during a demonstration one night, and several of them were arrested, but there was no real personal violence. That event was replicated in Troy and Schenectady and was a major source of news for a while. During the height of this tension, Marty and Wilbur came to the Village Trustees, and Marty told them that he had to prepare the Nassau Police Department for this new law enforcement crisis. He had a wish list of new gear, including a pump shotgun, 2 riot helmets, 2 bulletproof vests, and some tear gas canisters. As their counsel, I unsuccessfully argued against Marty’s request, pointing out that I had only known of two young black men in the Village. One, “Sunshine” Fairbanks had gone to elementary school with me but had long since moved away, and Harold Hallenback, a young man two grades behind me, whose family had lived just outside of the Village for a couple of generations. While the Trustees nodded their heads in agreement that Harold was unlikely to pose a threat, they felt that they owed an obligation to Marty to equip him with the equipment he said that he needed for his safety. They also apparently felt the same obligation to Wilbur, since they authorized two helmets and two vests. For a few weeks, Marty and Wilbur rode around wearing their helmets and vests, with a pump Mossberg 12 gauge handy on a special rack. After a while, though, the newspaper headlines returned to normal, and the helmets and vests went into the trunk of the patrol car. But if Harold ever walked into the Village and got rowdy, Marty and Wilbur would be ready.

At Wilbur’s prompting, I think, Marty came to the Village Trustees one September board meeting and reported that the Village had become a “laughingstock” because he wasn’t permitted to chase speeders outside of the Village corporate limits. Speeders would taunt him by racing through the Village, knowing that he would not follow. While the law permits a police officer in “close pursuit” to travel beyond the territorial limits of his community to make an arrest, many communities had a policy restricting their officers from doing so because so many high speed chases resulted in tragedy, frequently to innocent bystanders. Marty asked for permission to chase speeders outside of the Village. The Trustees were not enthusiastic, but neither did they like being the elected officials of a community that was becoming known for its lack of traffic law enforcement, especially considering its reputation as a speed trap just a decade before. The trustees finally agreed that Marty could in appropriate cases, chase traffic violators outside of the Village.

When I drove into the Village for the October board meeting, I was surprised to see a shiny new police car parked in front of the Village Hall. I knew that there was no appropriation for the purchase of a new police car during the fiscal year, and asked Mayor Strevell how they got the new car. Remembering that I had cautioned the Village Trustees against permitting close pursuit chases at the previous meeting, he was a little sheepish in explaining to me that the very Saturday after the previous meeting, Marty and Wilbur went in pursuit of a speeder heading west through the Village on Route 20. With the siren screaming, and the red lights flashing, Mary drove the cruiser out of the Village, and into the Town of Schodack. The speeder went faster and faster, and so did Marty and Wilbur. They raced past the veterinary clinic on the left, and the fruit stands on the right, up Bunker hill past Thoma Tires. As they neared Schoolhouse Road, Marty got closer and closer to the speeder, less than 100 feet from his rear bumper. Marty didn’t immediately realize that the reason he was closing the gap between the cars was that the speeder was slowing down to make a right turn into Schoolhouse Road. Instinctively, Marty turned right also. That had been a mistake, because Marty lost control of the cruiser when the tires slid on the gravel of Schoolhouse Road, and the police car slid into a stand of lilac bushes and rolled over onto its side. Fortunately, Marty and Wilbur were merely shaken up, but except for a bruised ego, were otherwise unhurt.

Getting back to the new police cruiser, Mayor Strevell explained that the wrecked car would have taken at least a month to have fixed, and the Village couldn’t be without a police car for that long a time, especially with Halloween coming. Marty and the Mayor called the Dodge dealer in Albany, who promptly arranged a trade-in with the Village’s insurance company, and delivered a new replacement for the wrecked car. Although nothing was said at the Village Board meeting, Marty didn’t chase speeders out of the Village again, and Wilbur’s wife decided that Wilbur should spend his spare time helping out around the house instead of riding with Marty.

Marty continued on as Nassau’s police officer for several uneventful years, until he had enough time in the New York State Municipal Retirement System to be eligible for a pension. He spent his remaining years as a security guard in a home for the aging in Albany.

Nassau Barbers

In my earliest memories of getting a professional haircut, probably sometime in the mid-1940s, there were two barbers in Nassau. Lou’s barbershop was on Chatham Street, just a little south of Albany Avenue. I remember that he was a quiet man, and my father took me there only a couple of times. The shop closed abruptly in the late 1940s because Lou cut some customer’s hair completely off, and shortly after that, he was committed to a mental institution where he later died.

The other barbershop was run by Joe Sauca, a very outgoing Italian man who had a shop on the south side of Albany Avenue, just east of Alice and Artie’s bar. That shop had two chairs, although for many years only Joe worked there. When my father took me for a haircut, he also got his own haircut and a shave. It was very common then to have the barber shave men, although I never really understood why since the men shaved themselves the rest of the time. Shaving involved a ritual: After the haircut, Joe would take a hot damp towel and completely cover his customer’s face with the barber’s chair in a semi-reclined position. While initially, Joe used shaving soap in a cup lathered up with a shaving brush, I believe that the practice eventually ended for sanitary reasons, since the brush went from customer to customer. The shaving brush was replaced with a black electric machine that spewed a rich hot lather. After Joe shaved his customer with a straight razor, which he frequently stropped on long belts of leather attached to the chair, the remaining lather was washed away with the towel, and bay rum liberally applied by hand over the customer’s face.

In June 1953, Joe died at the age of 41. He was on vacation in Maryland and was fishing on a bridge with his wife. When a gust of wind blew a package of fish hooks into the roadway, he attempted to retrieve it but was struck by a passing truck and sustained fatal injuries. Joe’s son, Chuck Sauca, dropped out of high school and enrolled in a barber training course. After a few months, Chuck got his barber’s license and ran the shop for several years. As a teenage barber, he didn’t always use great judgment and infuriated one mother when he gave her son a “Mohawk” haircut.

Chuck died in his late 40s of natural causes, and the shop was sold.

I

New York's Preparation for Nuclear War

During my 1961 summer break from law school, I took a position with the New York State Department of Health Office of Medical Defense in Albany.  The official in charge was James H. Lade, M.D., a longtime employee of the department whose previous position included syphilis control.  When I first came on the job, Dr. Lade explained that his office’s primary mission was to take charge of medical catastrophes in the event of a nuclear war.   The office had been created on July 29, 1950, during the cold war “to draw up plans for the mobilization of medical resources in the case of enemy attack.”  It was initially funded, in part, by the Defense Production Act of 1950.

 

One of my first jobs was to accompany another employee to a warehouse in Cohoes to inventory hospital equipment and medicine.  I was told that there were similar stockpiles throughout the state, some in state prisons.

 

Following the inventory, I questioned Dr. Lade why the stockpile of medicines had expiration dates of 1952 and 1953.  Dr. Lade replied that the Office of Medical Defense was created from the fear of a nuclear attack.  Hospital equipment and various Medicines and hospital equipment were quickly acquired and stored, but as tensions eased, the legislature did not appropriate funds to restock medicines or maintain or purchase updated hospital equipment.  I asked Dr. Lade when, after a nuclear attack, he would know when to come out of his bomb shelter to take charge of distributing the medicines and equipment.  He just laughed and told me that he had no bomb shelter, as he believed that no one would survive such an attack.  He said he didn’t even know if the hospital equipment would still work since it had been stored in various places and never routinely checked.

 

Now I wonder whether, later in this decade, there will be warehouses filled with obsolete ventilators, masks, gloves, and other Covid-19 paraphernalia that we are now acquiring but may be deemed unnecessary after a vaccine is invented and put into universal use.

May 13, 2022 Update:  We now have vaccines, but are warned that it is unlikely that covid variances will never go away, and there will likely be more pandemics in the future.

 

 

 

Junior's Business

On Thanksgiving Day in 1979, Peter Gibson and I formed a partnership to build a garage and office in the town of Hoosick, Rensselaer County, and lease it to Niagara Mohawk Power Corp, the local electric utility.  That was followed by similar deals in Saratoga and Essex County.  The partnership eventually became a corporation and later a limited liability company.  While we started out constructing the garage/office facilities, we soon ventured into land development, and over the years developed more than 200 residential lots in developments that we created from rural farms.  We also purchased other properties that we could divide and sell.

One such property that we purchased in the mid-1980s was a house and adjoining vacant lot located at the northeast corner of the intersection of Rte. 2 and Rte. 278 in the hamlet of Clums Corners in the Town of Brunswick, Rensselaer County.  We sold the house and set about to sell the vacant lot, which had desirable frontage on both Rte. 278, and also on a county highway.  The lot was zoned for commercial use but was subject to the town’s planning board approval process for any construction or development.

We soon found the ideal purchaser: Dake Bros, Inc. was a Saratoga County-based corporation that was developing an expanding base of stores similar to 7 -11 stores, called "Stewart's Shops" but featured its own brand of milk and ice cream, as well as some fast food items, cigarettes, candy, etc.  It had one other store in the town, which also sold its brand of gasoline.  We signed a purchase contract at a favorable sales price, but it contained a contingency that provided that the purchaser could cancel the sales contract if the Planning Board did not approve the installation of gasoline pumps.

Unfortunately, a garage that was located a short distance away that fronted on Rte. 2, and was owned by a local man, Mr. Hudson, sold gasoline in addition to its car service and repair business.  Mr. Hudson was against the impending competition, especially since the Stewart’s Shops sold gasoline at a discounted price.  As a local resident with family members who were voters in the town, he sought protection, and as a result the Planning Board, while approving the construction of the Stewart’s Shop, denied permission for it to sell gasoline.  As a result of this denial, the purchaser terminated the contract and we lost the sale.

Peter and I decided to fight back.  Since the lot was zoned for commercial use, planning board site approval was only required when the use included the construction of a building greater than 100 square feet.  We decided to open a tongue in cheek business on the site, which Peter named “Junior’s” after Junior Staples, a character in a country music/comedy show called “Hee-Haw”, that ran for about 7 years starting in the 1960s but had about 21 years in syndication.  “ In that show, the Junior Staples character was a used car salesman of questionable ethics. 

Peter had a small shack put together on the lot, together with a large sign that had removable letters.  A friend of his, who disliked the political establishment, was in the tent rental business and donated an old, torn tent that he erected on the lot.  Peter had an old rusty bulldozer and some wrecked cars brought to the sales lot, and every couple of days we would meet and change the sign.  The telephone number on the sign was one shown on the Hee-Haw show to call to purchase copies of the show.   This shows our “sales office” which was under the 100 square foot requirement for a building permit.  A tent was erected and a bulldozer brought to the lot.   The tent was not in the best condition, but it certainly was visible.

 Like a used car salesman on the Hee-Haw show, Junior needed some merchandise, which a local junkyard donated.

 




By this time the weeds were growing up and the site was becoming a real eyesore.  The building in the background is the high school, and there was a lot of traffic associated with it.  Clums Corners is on the main highway between Troy, New York, and Williamstown, Massachusetts.


The Brunswick town supervisor, Romeo Naples, controlled the planning Board and the town government.  We started calling the town government “Romeo’s Circus.”  

The neighbors were up in arms over what we had done, but many in the town (especially those who didn’t like Mr. Naples or the town government) were highly amused and supportive. People from other parts of the town drove by to see what changes were being made to the sign and what was being added to Junior’s inventory.  Even the local newspapers started carrying the story.  The rumor was out that we were going to bring some goats or sheep and stake them out on the site. 

Finally, either Supervisor Romeo or the chairman of the town Planning Board called Dake Bros, Inc., and asked them to buy the lot from us, with the promise that the Planning Board would promptly permit the sale of gasoline at the site.  The contract was reinstated, and upon closing of title, Junior’s went out of business. The Stewart’s Shops there does a thriving business.

                                        Flyers that were passed out

Pittstown in Wikipedia

 I always enjoyed injecting a bit of humor about the Town of Pittstown, Rensselaer County, where Nedda and I lived for several years in two different homes that we built.  Pittstown is very rural and very small town in its thinking.  Our company, Tomhannock, LLC, owned by Nedda, Peter Gibson, and me added hundreds of home sites here and substantially increased the town’s tax base, frequently over the objection of natives who dislike our changing unused land into productive housing opportunities for families.

 Once I happened upon the Wikipedia entry for the town and decided to have a bit of fun by adding to its demographic description that the average IQ was 68. I used the name of a local junk dealer who the town government was battling over his violations of town law.   That modification prompted the following entry, later deleted, but still available:

Talk: Pittstown, New York

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“The current page lists the average IQ of this town as 68. Assuming this IQ is the "Intelligence quotient" discussed in a Wikipedia article of the same name, this puts the average IQ of this town in the "mildly retarded" range, which is difficult to believe. No reference is cited for this data. I recommend its deletion.

D. Clippinger (a proud resident of Pittstown)”

“D. Clippinger obviously has not carefully researched the unusual 20th-century history of Pittstown. Sparsely populated by many Hessian mercenaries who defected after the Battle of Bennington (actually fought in the adjacent town of Hoosick, in northern Rensselaer County, New York), the town’s industry and sparse population greatly declined with the end of stove manufacturing toward the end of the 19th century, making Pittstown one of the more economically distressed areas in upstate New York.

In an attempt to bolster employment, the New York State Office of Tuberculosis and Pox (later the New York State Department of Health) chose to locate two large tuberculosis sanatoriums there, one in the hamlet of Raymertown in 1873, and later, one in Valley Falls. Although these sanatoriums initially had large patient populations, tuberculosis was substantially controlled by the forerunners of modern antibiotics. Many sanitariums closed, including those in Pittstown. The Valley Falls sanitarium remained vacant until destroyed by fire during the blizzard of 1931, but the larger, Raymertown Sanatorium, located on the Troy - Bennington Turnpike (on the site of what is now the Sterup Square strip mall) was converted into a facility for the mentally ill and hopelessly retarded, named the Morgenstern Hospital.

During October 1936, a series of investigative articles appeared in the Albany Knickerbocker News that revealed that widespread use of an experimental drug made of lithium, mushroom extract, and anisette at the facility had aphrodisiac qualities, and as a result, the patients engaged in promiscuous, unprotected sex. Many female patients became pregnant and gave birth to children at the hospital. Many of the babies born to them looked normal but suffered mental retardation, and in some cases, Brewer's droop. Most were adopted out to people in the community, mainly to farmers who needed large families to help with chores. The infamy resulting from the newspaper disclosure caused the government to order the hospital to be closed and ultimately torn down when the highway was widened in 1952. These adopted children grew to adulthood, married, and for the most part stayed within the Pittstown community, as did their baby boomer offspring and their grandchildren. Also, many of the mentally ill and retarded patients were simply released to the community when the facility closed, and many of them stayed in Pittstown or neighboring Brunswick.

During the mid-1990s the admissions office of Hudson Valley Community College, a county-sponsored college in Troy, noted that an unusually high percentage of applicants from the Hoosick Valley Central School, the Brunswick Central School District, and to a lesser extent, the Hoosick Falls Central School, did not meet the community college’s modest requirements for admission, and notified the New York State Education Department. That agency applied for and received a grant from the U.S. Department of Health, Education and Welfare for a study, which was conducted in the towns of Pittstown, Hoosick, and Brunswick in conjunction with the 2000 U.S. Census. Although the residents of Hoosick and Brunswick tested in the low to the mid normal range of intelligence, the average IQ in Pittstown was found to be 68, using the Stanford-Binet IQ test. Educators concluded that the unusually low average IQ was due both to two centuries of intermarriage, and the many descendants of the persons previously born to

or confined at the Morgenstern Hospital.”

“My understanding is that the Valley Falls sanitarium was destroyed by fire in the Knickerbocker Storm of 1922. I can understand your confusion, as the facilities were the subject of arson in 1931 (alleged to have been set by vandal farmers from the town of Nassau, but never proven).”

Retrieved from "http://en.wikipedia.org/wiki/Talk:Pittstown%2C_New_York"

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Death, Taxes, and 9/11

I have been a co-trustee of some trusts that were created by two very successful real estate businessmen.  They were both attorneys, admitted to the New York State bar before I was born.  They made their fortunes as partners in real estate, originally buying slum properties in Troy, New York, but later, years before I became their general counsel, they shed that part of their business and invested in multifamily apartment projects, originally in the capital district of New York, but eventually acquiring properties in several states.  When they started their business, there were certain tax and liability advantages to put the title to the properties in small “C” corporations, which eventually numbered more than fifty.  As a result of tax law changes, and because it became difficult to manage the number of corporations, I consolidated the corporations into two holding companies.

As property values increased, the partners were able to refinance the properties multiple times.  Each time they refinanced, they were able to pay off the existing mortgages and retain very substantial funds.  Refinance proceeds are not taxable, so these corporations grew in value as the refinance proceeds enabled them to expand their holdings, and continually increase the value of the holding companies.  But there was a downside to the plan:  Upon the death of the partners, there were no family members who could continue the operations of the holding companies, which were owned by the partners’ trusts.  Selling the properties, either individually or in bulk created a huge financial problem.  The proceeds of such a sale would first be used to pay off existing mortgages, but there was a huge capital gains tax bill that would come into effect when the properties were sold, since the refinance proceeds that were retained at the time of refinancing tax-free lowered the “cost basis” of the properties, and the gain, and thus the tax, was more than could be realized by the sale. 

Fortunately, our New York City counsel came up with a solution.  They knew of a wealthy businessman, a CPA, who had figured out a method of avoiding the capital gains tax on a sale and purchased the holding companies from the trusts for a sum which netted the trusts' cash in the mid-eight-figures.  Suddenly, the trusts were flush with cash to invest for the benefit of the partners’ families, the ultimate beneficiaries. 

Trustees must be prudent in making the investment of trust funds.  This normally involves dividing funds between fixed-income investments (bonds or bond funds) and equities (stocks or managed stock funds).  It is also prudent to spread the investments among various brokers to get the benefit of a variety of investment options and advisory opinions.

One of the brokers with whom the partners and the trusts had previously used in Albany suggested that we go to the New York City office to speak with the company’s team of investment specialists.  That office was located in the World Trade Center.  We arranged for a morning meeting on September 11, 2001, a date that the man who had purchased the holding companies was going to host a celebratory dinner for us. 

September 11 was a Tuesday.  My original plan was to take the 7:00 a.m. Amtrak from Rensselaer to Manhattan, meet up with the other trustees and the broker’s Albany representative and go together to the Trade Center for the mid-morning meeting.  However, after the arrangements had been made, I remembered that September 11 was Primary Day in New York State, and I wanted to vote in the primary election because of its potential effect on the forthcoming local election.  According, I contacted the other parties and pushed the meeting back to early afternoon so that I could take a later train to New York City.

After returning from voting in the primary election, I returned home to gather my materials for the meeting.  As I was preparing to leave our home, my wife called me to look at the television, which was reporting the first airplane that hit the north tower of the World Trade Center.  At that time, it was thought to have been an accident that would have an effect on a few floors of one of the tower buildings.  I did not immediately believe that it would necessarily cause my meeting, in Building 7 of the World Trade Center, to be affected, and I still planned to go to New York City, if only for the planned dinner party. 

Then the second airplane hit the south tower, and I realized that the meeting or the dinner would never be held, and like millions of others around the world, I spent the next hours and days watching the horrible destruction the terrorists had brought as they struck the Pentagon in Washington, and the airplane brought down by passengers in Pennsylvania to prevent it's hitting an intended target in Washington, D.C.