Main Street Session Focuses on Complex Problems

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The Express Sessions: The Uncertain Future of Main Street Sag Harbor event was held at the Bay Street Theater on Thursday, 3/7/19. Michael Heller photo

A group of business, community and government leaders came together and tackled tough questions on the future of Sag Harbor’s Main Street last Thursday, coming to multiple conclusions — mainly that the village has plenty to be proud of, but Main Street’s vitality is threatened by the same regional problems affecting residents, nonprofit organizations and businesses outside of the downtown commercial district. And it’s going to take a great meeting-of-minds, they decided, to both preserve what’s already there and find solutions to make sure there’s growth in a positive direction.

Brought together by The Sag Harbor Express for a special edition of its “Express Sessions” panel discussion series at Bay Street Theater, speakers included Sag Harbor Village trustees Aidan Corish and Tom Gardella; Bay Street Theater’s executive director, Tracy Mitchell, and one of its founders, Emma Walton Hamilton; Chamber of Commerce president Lisa Field; restaurateur Jesse Matsuoka; business owner and Main Street property owner Nat Egosi; Save Sag Harbor board member Barbara Roberts; and Southampton Town Supervisor Jay Schneiderman.

Gavin Menu, the co-publisher and director of advertising of The Sag Harbor Express, called the challenges faced by Sag Harbor’s Main Street “a complicated conversation for many reasons.”

“We’re certainly not here to say that all is lost and that Sag Harbor has somehow lost its soul, because that’s just not the case,” Mr. Menu told the crowd at Bay Street Theater by way of introduction. “We and our panel of guests believe that Sag Harbor has emerged as a world-class resort with a vibrant business community, an exceptional restaurant scene, a cherished waterfront and a community that has held onto its small-town charm and cultural history — which is not to say we don’t have problems. The cost of living and doing business here has skyrocketed.”

The Express Sessions panel on March 7 included a diverse group of business and governmental leaders.

Are Commercial Rents Too High?

With the changeover of several local businesses over the last 18 months, and multiple empty storefronts remaining, the conversation turned to rents, leases and landlords’ return on investment — and the degree to which accommodations should be made for smaller, mom-and-pop businesses.

But if every Main Street landlord was like Mr. Egosi — a lifelong resident of Sag Harbor — there’s a good chance fewer businesses would have the same issues stabilizing leases and affording rent increases.

“When you grow up here and remain part of the community, you have a very clear perspective,” Mr. Egosi said. “The balance of profitability versus being community-minded takes that into account.”

Two of his tenants, Kites of the Harbor and Land Shark, are long-term, local tenants, and two more, a martial arts studio and a hair salon, provide a much-needed service to the community, Mr. Egosi said. In return for their dedication to staying open year-round, keeping attractive storefronts and being involved in the community, Mr. Egosi said he reciprocates with fair leases.

He said he’s observed outside investors scooping up commercial properties, saying, “they don’t necessarily understand Sag Harbor.”

“All of that results in higher rents. They come to Sag Harbor for what they see here, but what they want … is a change in the market for their needs,” Mr. Egosi said. “Changing is different than aligning. We want tenants who align with the community. They succeed in the long run, as we do as a landlord. Together, we create that legacy.”

VIDEO: Watch Thursday’s Main Street “Express Sessions” here

The conversation turned to the question of whether the village government has any right to regulate commercial rents that landlords can charge businesses. The answer, Mr. Corish said, is it does not.

“People still have property rights and the market sets the price,” he said.

And at least one property and business owner on the panel said she appreciates that fact.

“I’m grateful that it’s not possible that a government can come in and say, ‘We’re going to decide what you can do with your business,’” said Ms. Field, the owner of the Sag Harbor Variety Store, who also owns the building it occupies. “I run a family business, I want to stay in business. It’s not really fair to say you shouldn’t be able to get a return on your investment that your family has spent 50 years working towards.”

Still, some in the audience on Thursday wondered if there is more the village can do to control the types of businesses that land on Main Street.

From the audience, Janice D’Angelo, who owns the Sag Harbor Pharmacy, asked, “When do we stop every Main Street from looking the same?”

Panelist Tom Gardella replies to a question during The Express Sessions event at Bay Street on March 7

Chain Stores Here?

What Sag Harbor can do, and has done, is create zoning policies that discourage large chain stores and national brands from setting up shop on Main Street. In a recent online survey conducted by The Sag Harbor Express, many respondents said they didn’t want those types of businesses here, and indeed, a 2009 update to the village zoning rules limits the sizes of downtown storefronts to 3,000 square feet.

“We can just create an environment that makes it less attractive for chains to come in,” Mr. Corish said, explaining that the size limitation often makes having a storefront in Sag Harbor unpalatable to large, national chain stores.

Mr. Corish said he thinks the 2009 code change “did a really good job in maintaining the character of the village without placing too much of an onus on the property owners.”

“Now we need to take care of what we have … and balance the rights of individuals and the village in the long term,” Mr. Corish said. “People come here for culture, for entertainment. If we can maintain that, we’ll be a long way toward maintaining the vibrancy of our Main Street.”

Mr. Gardella said he’s open to updating the code even further. “I don’t think anything should be written in stone. Situations and areas change.”

Southampton Town Supervisor Jay Schneiderman addressing the need for affordable housing on the East End.

Affordable Housing, Again

Just two weeks after an Express Sessions event at The American Hotel took people on a deep dive into the issue, the lack of affordable housing on the South Fork emerged on Thursday as a key problem impacting commerce and community in Sag Harbor.

Panelists said the lack of affordable options for residents and workers leads to congestion on the roads, as well as trouble for businesses that can’t retain employees, and the degradation of a tight-knit community.

Mr. Gardella, who owns a plumbing company in addition to serving on the village board, says he’s lucky because “my workforce lives with me — my son,” but he sees the problem all around him. He was lucky enough to buy a house before the real estate market mushroomed, but now, “the opportunities aren’t there anymore.”

“We can have workforce housing, but what’s the long-term solution?” Mr. Gardella asked. “The real estate is being sold at a really high level. How many of these people are really staying here and taking part in the community? How do we form a balance with that?”

Mr. Matsuoka is among a handful of business owners here who actually own or rent houses for their employees. He and his partners at Sen own their building and recently added apartments there for some of their employees. Still others commute more than an hour to get to work. They will face a similar housing problem when they open their new restaurant at the former La Superica space.

“The village or the towns can help out by communicating how businesses might be able to take on an affordable housing project,” Mr. Matsuoka said. “I’ve heard of multiple people coming together to purchase homes for their employees. As businesses, we can come together and purchase something of our own to offer back to the community at an affordable rate.”

Asked whether there is data supporting the need for affordable housing, Mr. Schneiderman quipped, “It’s raining out. Do you need a weather forecast?”

“This is a crisis — an emergency in the affordable housing situation,” he said.

He said in Southampton Town, building codes prohibit more than four unrelated people living together in a single house. “We might need to look at that to make it a little bit easier” for people to afford to live here, Mr. Schneiderman said.

There’s also the matter of community opposition whenever housing development proposals are put on the table.

“We’ve proposed 60 affordable units behind the church in Southampton, and a lot of people have come out of the woodwork to oppose it,” Mr. Schneiderman said. “All the people who say they support it probably do, but they don’t want it near them.”

Mr. Corish said in Sag Harbor Village, “it’s a 600-pound elephant in the room.”

“It demands a really different conversation,” he said. “What do we do with land use? How do we assign people homes? I look at it as a member of the board of trustees. I don’t think we have the wherewithal to deal with it in our village.”

But from the audience, one of his colleagues on the village board, James Larocca, pointed out that Long Islanders have historically had long commutes — whether to New York City or other places.

“A commute of an hour and 20 minutes is commonplace on Long Island,” Mr. Larocca said. “With the advent of a lot of big companies into Suffolk, people on the North Fork began commuting as far as Route 110.”

He asked the panel, “What is the actual goal? Is it to make an economy or community that will not have to rely on commuters?”

He said that type of situation is rare, but it “doesn’t mean the aspiration is wrong.”

“That’s the market working, one would argue,” Mr. Larocca said. “When you see the trade parade in the morning you’re seeing an expression of a market that people are enduring to come here every day because the economics of it work for them.”

From the audience, Steve Williams, a longtime resident of Azurest, said “we’re in a very tenuous time right now” because of the lack of reasonably priced housing.

“If you’re not going to really get serious about affordable housing … it’s going to hit the bottom of the hill,” Mr. Williams said.

Sag Harbor Village Trustee James Larocca addresses the panel from the audience at Bay Street.

Related Issue: Volunteerism

In response to Mr. Larocca’s comments, Mr. Gardella said he’s “not trying to create a utopia where all the people who live here work here.”

“We do need to have people in the community who do live here and work here and sustain something like a volunteer fire department or ambulance company,” Mr. Gardella said to a chorus of applause from the sold-out audience.

Indeed, he said, the numbers of volunteers for those services are “slowly dwindling and they are taking on a lot.”

“The real estate is a driving force here,” Mr. Gardella said.  “We do need to try to come up with some solutions to keep the community strong.”

Lately, the village has needed other types of volunteers: those willing to serve on regulatory boards such as the Zoning Board of Appeals and Board of Historic Preservation and Architectural Review, where resignations have been popping up with what seems like great frequency over the last several months.

From the audience, Robby Stein encouraged people to get more involved in local government and other causes. He is a former village board trustee who is currently serving as the chairman of the Zoning Board of Appeals, and who has also served on the boards of Bay Street Theater, Mashashimuet Park and other organizations.

“Come to the boards, run for offices, be on the boards. This is a responsive village,” Mr. Stein said. “If you want to change and get involved with what’s going on here, you have to do that.”

Mr. Matsuoka said the Chamber of Commerce needs more help, too.

“We need more volunteers to put our minds and resources together to come up with a great strategy,” he said. “It’s truly an amazing village. We can hopefully just make it better.”

Sen restaurant co-owner Jesse Matsuoka said arts institutions like Bay Street Theater are critical to the success of his business.

The Role of the Arts in Commerce

A 2015 study by the national organization Americans for the Arts found that $166.3 billion of economic activity was generated by cultural organizations and another $102.5 billion was generated in related spending by audiences who consumed various forms of entertainment.

That has been the experience here, too, according to Ms. Hamilton, Ms. Mitchell and Mr. Matsuoka.

In 2017, the Sag Harbor Partnership announced an economic impact study that said the rebuilding of the Sag Harbor Cinema could bring as much as $9.6 million into Sag Harbor each year.

“We know the arts bring money to a community. They create jobs and draw visitors to the area. Those visitors then spend their money at other local businesses,” Ms. Hamilton said during remarks that also included the social value of arts and cultural institutions. “The arts hold a mirror and allow us to see who we’ve been, who we are and who we’re becoming,” she added.

Arts institutions employ 4.6 million people across the nation, the national study found. Locally, Bay Street Theater employs 14 people year-round, Ms. Mitchell said. But the theater has “no profit margin,” she said. Like many businesses, Bay Street “earns its money in July and August to support the rest of the year.” Just like many others in town, she and other panelists agreed.

“I think people forget how connected our businesses actually are,” Ms. Mitchell said.

Mr. Matsuoka said Bay Street’s hungry audiences are one reason why he keeps his restaurant Sen open year-round. That, and events like the Chamber of Commerce’s HarborFrost celebration every February, he said.

“It is truly because of the buzz and events that are put on throughout the winter that makes it worth it for me to house and staff and to be open through the winter,” he said. “It’s not so we can make money. It’s to hold on to staff.”

A major anchor of Sag Harbor’s arts scene, Bay Street Theater has four years left on its lease from property owner Pat Malloy on Long Wharf. Ms. Mitchell acknowledged the nonprofit theater — which relies heavily on fundraising — is considering all of its options, from staying to expanding to moving.

“Our goal, my goal, the goal of the board of trustees is to make Bay Street Theater a permanent institution,” she said. “It means we need to have a home of our own. We have so outgrown this facility as it is. There is no place to go on Main Street anymore. We rent 14,000 square feet here, another 8,000 square feet in Riverhead for our shop, another 2,000 square feet in the summer for camps and we rent 15 houses in the summer along with hotel rooms. Housing alone is $350,000 a year. That’s the cost for us of another production or two that we could be offering the community. … We are looking at a very heavy lift.”

There was a good amount of back-and-forth between the panel and a sold-out audience.

Blueprints for the Future

Ms. Field said an easy way to protect the vibrancy of Main Street is to encourage shopping local. “Patronize the small, independent stores you want to remain here,” she said.

The Chamber of Commerce, she said, works on marketing strategies to make Sag Harbor attractive to visitors.

“Sag Harbor is not lost,” she said. “We want to keep what we have and continue to build on it. I believe the chamber is more important now than ever, especially as the business district evolves and there are changes going on.”

Mr. Schneiderman said there are communities that are stagnating because they lack one of Sag Harbor’s best assets — its downtown sewer district, the expansion of which Sag Harbor Village is exploring. Sewer systems equate to more “wet uses,” specifically restaurants, in commercial districts.

“People want to interact. Everyone wants to interact around food,” Mr. Schneiderman said. “There’s state, county, town money for sewers. The communities have to ask. Some are resisting growth.”

Later on, Ms. Roberts, who used to serve on the Suffolk County Planning Commission, called for a formal comprehensive plan as a way to map Sag Harbor’s future. She envisioned one similar to the report Save Sag Harbor funded in 2007, motivated by the potential for the CVS chain drugstore to move into the village, that led to the aforementioned zoning code revision two years later.

She defined a comprehensive plan as a process in which stakeholders from throughout the community “come together to figure out what is really going on” and sit together to sort out the issues.

“The only way that we really will know the future of Sag Harbor is to invent it ourselves today,” Ms. Roberts said.

Mr. Stein suggested the way to accomplish this would be through joint efforts by public agencies and private organizations working together.

“We don’t have the money” in the village budget,” he said. “Partnerships that have to develop are going to be able to give us what we need. We in government can help with zoning to make things a little better, but it’s private-public partnerships that will change it, in my opinion.”

Takeaways and Viewpoints

Having made her first visit to an “Express Sessions” event, Sag Harbor Mayor Sandra Schroeder on Monday said it was “nice to see how well-attended it was.”

She said everywhere she goes, she constantly asks people what they think of Sag Harbor, and almost always hears people say how nice and friendly the village is.

Ms. Schroeder gave the downtown business community a lot of credit for those reviews. For example, she said, people are better off going to the Persan’s Ace Hardware or to Emporium True Value Hardware than they are going to Home Depot because the store employees are friendlier and more knowledgeable.

“They’re so helpful, and I think that’s one of the reasons why Main Street is so good,” Ms. Schroeder said of the business community.

On Tuesday, reflecting on Thursday’s event, Mr. Larocca said, “I don’t know anyone who likes the evolutions we’re seeing, but as we begin to talk about remedies, that’s where we have to get specific.”

To preserve the village’s vitality, Mr. Egosi called for schools to provide more education on what it means to be a community — “to understand how Sag Harbor operates as a community, how they can have a family and they can live here,” he said.

“People who are here, where are they working?” Mr. Egosi asked, calling them “the silent majority.” “We have this disconnect. … The person driving two hours here, someone is paying them a good buck to do that. Meanwhile, someone who lives here could work here.”

From the audience, James Merrell, a local architect, wondered whether “greater metropolitan Sag Harbor” — the postal district, fire district, school district — should be incorporated into the village itself.

“When it comes down to the resources available to do some of the things we’re talking about, I sort of wonder if the village limits as they are currently or historically described are too small to answer some of the issues,” Mr. Merrell said.

Mr. Williams compared Sag Harbor’s issues to the gentrification problems Harlem is experiencing.

“You are suffering from your own successes,” he said.

He said he has noticed some restaurants offer lower prices on some nights to attract the year-round clientele, and suggested more businesses do the same.

Ms. Hamilton echoed his comments, complimenting Provisions for its “Fruit and Nut Club” and Bay Street Theater for its discounted senior and student nights.

“If more businesses had incentives for year-round residents to shop locally, it would really encourage us to come out of our houses and shop more,” she said.

Adam Miller, who runs a large legal firm on the South Fork, agreed with Mr. Williams on affordable housing, saying that “people are priced out of the community” due to rising property values. High property values can be a good thing, he said, but “we need people in these towns to make your businesses vital,” and the area needs to serve both residents and out-of-towners.

“Property values have increased so much, but that’s going to go away if the commercial downtown districts can’t support the people who want to come here in the summer,” he said.

Ultimately, he said, “I commend Sag Harbor for what they’ve done with their downtown.”

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