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MENDEL LERNER, FAR left, and Steve Proyect, representing Congregation Khal Bnei Zion Inc., a Hasidic group out of Brooklyn, answer questions from the Town of Fallsburg Planning Board.

Raleigh's Future
Being Determined

By Nathan Mayberg
SOUTH FALLSBURG — June 13, 2006 – The group trying to purchase the Raleigh Hotel has plans which are far different than the resort’s storied past.
And in all likelihood, they will be off the tax rolls as well.
Congregation Khal Bnei Zion Inc., a non-profit Hasidic group out of Brooklyn, presented their plans to a largely skeptical Town of Fallsburg Planning Board on Thursday. Their representatives laid out their intentions to turn the longtime resort into a summer camp and religious school for children, using the hotel for boarding and other activities.
Their plans were presented by local consultant Steve Proyect and operations manager Mendel Lerner. Lerner, who refused to give his name initially, also refused to divulge what stage the applicant was at in purchasing the property. Neither Lerner or Proyect could give contact information as to the principals behind the purchase.
Proyect stated that the applicant was able to use the property as a camp and school because its zoning allows the hotel to have an accessory camp and school. But Planning Board Chairman Arthur Rosenshein said the plans appeared to use the hotel as an accessory to the camp. Furthermore, he said the intention of the permit was to allow a day camp, not an overnight camp which ran all season long.
“This may not fit our zoning,” he said.
Rosenshein called for more specific details in writing as to how the hotel would be used. He expressed concern about safety, due to the number of children that would be roaming the large, seven-story resort, potentially unsupervised.
“There are a lot of questions that I feel are open,” he stated.
Lerner said that the New York State Department of Health had expressed concerns over safety as well.
Board attorney Ron Hiatt will be studying the legal issues regarding the zoning. The town engineer requested water and utility plans. Town Building Inspector Allan Frishman said the project would require a 239 review by the county.
The entire hotel property encompasses 200 acres, but the current proposal only includes 90. Board members questioned Lerner as to whether the group intended to purchase the entire 200-acre property but received no response. The prospective owners run a number of religious summer camps throughout Sullivan County.
There are 328 rooms in the entire complex. Lerner estimated about 200 children would attend the camp, and between 20-30 families of the supervising adults would stay there as well.
The Raleigh can hold approximately 700 guests. It features a pool and a nightclub, which has hosted some of the biggest names in show business over the years and could be transformed into a synagogue.
Town of Fallsburg Supervisor Steve Levine has little hope that the hotel will stay on the tax rolls if the group closes on the property.
“It’s unfortunate that we are losing the jobs the Raleigh had and a lot of the tax revenue,” he lamented.
He said there was a strong potential that the Raleigh property would come off the tax rolls if the religious group was to purchase it. However, he has heard that the group might build homes on the remaining 110 acres not included in the plans. Those homes could be taxed, he said.
“The tax-exempt issue is just not fair to the taxpayer. The state has to limit the exemptions that they grant. A lot of the [not-for profits] are taking advantage of the law. There are a lot of wealthy tax-exempt organizations living off these exemptions, making a lot of money, and the communities are suffering for it,” he said, adding that 44 percent of Fallsburg’s properties are considered tax-exempt.
Any official action will still have to wait out the courts. A former businesswoman who was close to purchasing the hotel, part of #1 Funding Center in Queens, filed an injunction at the last minute to stop a wire transfer which would have closed the deal between current Raleigh owner Lori Landon and Congregation Khal Bnei Zion Inc.
Landon’s legendary father, Mannie Halbert, ran the famous hotel for decades but passed away in 2004.

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