Buffalo City Hall deli operator owes more than $100,000 in rent

The amount owed to the city through last April is $103,200.

The audit report, delivered to the Common Council last week by Comptroller Barbara Miller-Williams, indicates the contract was signed in December 2013 with an initial term of three years and an option for three additional years. It expired in December 2019.

Sue’s NY Deli has been operating without a valid contract since then, documents show.

“Operating without a valid contract exposes the city to legal and financial risks,” Miller-Williams wrote.

Operator William Badawy said Tuesday he reached an agreement with a former Department of Public Works commissioner to not pay rent for a period of time. He asked a Buffalo News reporter to call him back in a few days for an update.

The committee suspended further discussion Tuesday because the city auditor was attending a graduation ceremony, said Ellicott council member Leah Halton-Pope. The subject will be discussed in detail on July 2, during the next meeting of the Finance Committee.

Sue’s NY Deli continues to serve breakfast and lunch Monday through Friday.

“The operators of Sue’s are great people,” said Mitchell Nowakowski, Fillmore council member and chair of the council’s finance committee. Personalities aside, he said: “It’s a lack of contract. »

The pandemic might help explain things, Nowakowski said.

“Covid hit in March (2020),” he said. “We have additional safety protocols that reduce foot traffic at City Hall, and we also have food prices skyrocketing, so, to me, where is the administrative function that says, ‘Look, we need to renegotiate this'”. lease due to economic factors? »

The city is supposed to receive $2,150 a month in rent to operate the cafeteria. Rent is due on the first of each month and a 1% late fee is applied monthly until fees are paid in full. The City may terminate the agreement at any time upon 10 days’ written notice.

City officials issued a tender in 2013 to find a food service operator at the historic municipal building. Sue’s NY Deli was selected and has been operating the cafeteria located in the basement of City Hall since 2014 until present.

Miller-Williams recommended that the city issue a bill for any unpaid rent and create a plan for the cafeteria moving forward. The city should not allow the cafeteria to operate without a contract in place, she said.

Additionally, the city should evaluate all options for operating the cafeteria, including removing Sue’s NY Deli due to unpaid rent and issuing a request for proposals to select the best operator, added Miller-Williams. Once the assessment is complete, the city should determine which option best serves taxpayers and City Hall, according to the documents.

Additionally, Miller-Williams also recommended that the city improve contract management and oversight. Specifically, she recommended that the city and Department of Public Works develop and implement policies and procedures to manage and oversee contracts, focusing on revenue-generating contracts. This should include regular monitoring, compliance checks and accountability measures to mitigate risks and ensure operators meet contract requirements.

The Comptroller’s Office should now be formally included in the review and approval of revenue contracts, Miller-Williams recommended. Currently, revenue contracts are not submitted to the Comptroller for review, but historically the office was responsible for approving all expenditures, including expenditure contracts.