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Knights Received More Than $120,000 In Taxpayer Money But Never Followed Through On Filing Petition To Complete Donation
By Tina Traster
From the start, the plan for the Haverstraw Council 581 of the Knights of Columbus to donate its building at 56 West Broad Street in the Village of Haverstraw to the Town of Haverstraw, was riddled with problems. Now, questions are being raised as to why the Knights never filed a petition with the Attorney General’s Charities Bureau to seek approval for the transaction even though they entered into a formal agreement with the town to donate their building on June 25, 2024, and received taxpayer money totaling nearly $120,000 over the past 14 months.
At issue is whether the Knights, or their attorney (the firm was hired and paid for by the Town of Haverstraw) intentionally failed to file the needed petition and why? And, if no petition was filed since the June agreement was inked, who made the decision to withhold the filing of the petition?
While these question remain unanswered for now, here’s what is known:
For more than a year, the Knights were negotiating with an affordable housing developer to sell their building for $2.4 million. Kings Katherine LLC planned to build 100 affordable housing units, a parking deck, and allocate space in the building for the Knights in perpetuity. Town Supervisor Howard Phillips, along with a quorum of town officials, held a private meeting at the 11th hour with a new Grand Knight where the parties hatched a deal for the Knights to forego the sale and donate the building to the Town of Haverstraw instead. The closed-door meeting violated the Open Meetings Law. The Knights, saying their Catholic Fraternal organization was on life support, latched onto a deal that would make them flush — at least in the short term. Phillips in June 2024 offered them $7,000 monthly until the donation deal was completed, plus the town inexplicably paid the Knights’ “back rent” of $56,000 for the first six months of 2024. The temporary deal also included taxpayer money to install a $14,000 fire alarm, as well as paid attorneys’ fees.
The obliteration of the building sale angered the developer, tax watchers, defenders of the Constitution’s separation of church and state, Village of Haverstraw officials who have been champions for affordable housing, and the former Grand Knight who had shepherded the original sale.
When the Knights entered into the donation agreement with the town, they knew they needed the New York Attorney General’s Charities Bureau to greenlight the transaction. The Attorney General’s determination is a requirement when a nonprofit sells an asset.
According to the contract between the Knights and the town, the Knights were paid $56,000 from January to June 2024 in back “rent” (even before the ink on the donation deal had dried), and they would receive $7,000 monthly going forward until the “Attorney General signs off” on the deal, according to the contract. A Haverstraw town resolution built in a provision in case the Attorney General’s office denied the donation: “Starting the first day of the next month after such a denial, rent shall be reduced for the remaining lease term to $2,000 a month.” The lease says it expired on December 31, 2024, but the payments continued.
Prior to these negotiations, Haverstraw paid the Knights roughly $800 a month to use their building for seniors’ gatherings.
It was no secret that several entities had filed complaints with the Attorney General’s office objecting to the donation plan. RCBJ reported on the complaints, including one from the Freedom From Religion Foundation, which pointed out that the town could not support a religious organization with tax dollars. Public officials railed against the use of taxpayer money to support the Knights. For months, it was presumed the Knights had filed their petition, and were waiting for a response.
Then in a surprise turnaround, on Feb. 13, Grand Knight Joe Vargas told the Knights’ council the “the deal was off.” He offered no explanation and made vague statements about the town continuing to work with the Knights for their “mutual interests.” Phillips, who is a Fourth Degree Knight, but never attends Knights’ meetings, according to sources, has publicly maintained the building was needed for senior activities. Every Town of Haverstraw councilman is a Knight, though not active in the council, according to sources who regularly attend meetings.
After Vargas announced the deal had been scrapped, RCBJ asked the Attorney General’s office if the petition had been withdrawn. The Attorney General’s spokesperson said no petition was ever filed. This response was verified more than five times via a series of emails. “We do not have a petition for this,” the AG spokesperson wrote in an email on Feb. 25th
If no petition was ever filed, were the Knights receiving monthly installments of $7,000 of taxpayer money on an indefinite basis for a donation that could never occur? Did they know the petition had never been filed? When did the Town know the deal was dead? Why did the Town keep funding the Knights?
At the Feb. 13 Knights meeting, Vargas read from the October minutes. He said the Knights had sent their information to the lawyers in Albany that month.
By many accounts, there was a presumption that the Knights’ attorney, the Albany-based Girvin & Ferlazzo, had filed the petition last fall. On Oct. 10, Girvin & Ferlazzo submitted a $2,235 invoice to the town for petition preparation. The town issued a check to the law firm for the full amount on Oct. 23.
Girvin & Ferlazzo continued to work on the preparation of the petition through November, racking up an additional $1,491 in fees. On Oct. 24, the firm billed the town for “finalizing and reviewing the petition,” and on Oct. 30th, the firm billed the town again for “reviewing the petition.” However, nothing in FOIL-ed documents indicates the petition was filed. Instead, from Nov. through January, the firm apparently pivoted and worked on “a proposed lease.”
Neither Grand Knight Vargas nor Attorney Daniel Rubin from Girvin & Ferlazzo returned multiple emails seeking comment or an explanation as to why the petition was never filed.
Knights Were Notified Of The Need To File
At the same time that the law firm was preparing the petition, the Knights were made aware that its petition had not been filed. The Knights received a letter from the AG’s office dated Oct. 9 titled: “Planned Transfer of Knights of Columbus Property at 56 West Broad Street.” The letter said: “This office has received information about a planned transfer of the 56 West Broad Street property to the Town of Haverstraw. The timing of the transaction is unclear from the information we have received. Please advise me concerning whether the information we have received concerning the planned transfer is accurate, and when we may expect the petition for approval.”
On Nov. 18, nearly five weeks later, former Grand Knight Todd McGowan, who independently wrote to the Attorney General for an update, received a letter from the Attorney General’s Charities Bureau. “We have reached out to the Knights of Columbus to notify them of the requirement to file a petition with the Attorney General regarding the transfer of property,” the letter said. “We have received a response from the Knights of Columbus informing us that they are in the process of preparing a petition to submit to the Attorney General seeking approval of the transaction.”
The petition still had not been filed.
To date, the Knights have been paid close to $120,000 in taxpayer money to cover expenses (the majority of the monthly payments have been redistributed to Catholic Charities as donations, according to sources close to the Knights). The organization, which had been struggling for years, was newly flush. A source says the Knights, which historically gave $200 to $30o donations to churches, was now shelling out thousands of dollars (donations as high as $5,000 apiece) to St. Peters/St. Mary’s Church to repair church bells and boilers.
“These were large donations,” said a source who preferred to remain anonymous. “We were bankrolling the church.”
Which raises the question of the legitimacy of the Knights using tax dollars to support Catholic Charities in the first place — but also the ethics of using this money without following through with the petition. It remains unclear what will happen next — and whether the nearly $120,000 the Knights have already received has been misused, or needs to be repaid. In the meantime, Phillips, sources say, is continuing to seek ways to keep control of the building, rather than allow the Knights to sell it because he is opposed to affordable housing in the Village of Haverstraw.
Town Haverstraw Attorney Bill Stein did not return an email seeking comment.
