LIDO BEACH, N.Y. (CBSNewYork) — A controversial contract is creating a battle over a popular beach club.

The Hempstead supervisor is accusing several town officials of making a backdoor deal with a company that owes hundreds of thousands of dollars in rent, CBS2’s Jennifer McLogan reported Wednesday.

With its surf, pool, tennis courts, camps, concessions and 600 cabanas, Malibu Beach Park is profitable. Some families have to wait on a waiting list 15 years to get an opportunity to use it.

“Where can you go for $5,000 for the whole the summer and have vacation time every day?” Malibu cabana renter Mary Karaman said.

Malibu Beach Park (Photo: CBS2)

But according to the town of Hempstead, Malibu’s operator, Dover Gourmet Group, has not paid the town rent for nearly a year and records show it has failed to pay substantial rents in the past.

“This newest alleged backroom deal at Malibu Beach would gift over half a million dollars to date to Dover Gourmet on the backs of our taxpayers,” Hempstead Supervisor Laura Gillen said.

Caterer Butch Yamali, Dover Gourmet’s chief executive, claims he hasn’t paid because the town owes him $2 million for capital improvements, worked out in verbal agreements.

“There’s no backroom deal. There’s no verbal nonsense that was misquoted. This was very straightforward,” Yamali said.

It’s the talk of the beach club.

“Butch does a great job here. I mean, the repairs he put into this place is unbelievable,” Malibu patron Rich Karaman said.

“He doesn’t pay rent for the camps. He doesn’t pay rent for restaurant. So what is his complaint? I think the town got shortchanged here,” patron Tony Corso said.

“I am putting forward a resolution to retain outside independent counsel who is free from partisan political influence and business ties to investigate this matter, this contract and protect the taxpayers of this town,” Gillen said.

Yamali answered back.

“This is a direct and personal attack on me and I don’t even know why. It’s embarrassing. I have to protect myself and I seek legal counsel and I’ll have to sue her for defamation of
of character,” Yamali said.

Gillen said extending Yamali’s contract and not collecting rent was done without board approval, in a sweetheart side deal.

In the meantime, the town supervisor is calling for the immediate resignation of the appointed — not elected — parks commissioner, Daniel Lino, calling his actions on the Dover contract corrupt and illegal.

Lino declined comment. Some members of Hempstead’s Republican majority support an independent investigation.


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