Legal Fees: Escrow Payments

by Kathy Savolt -

Recently, the Mamaroneck Observer published an analysis of the legal fees paid by the Village over the past five years.  See article HERE.

It was noted that legal services and expenses are divided into three categories:  those covered by a flat rate monthly retainer, litigation fees and fees paid by applicants through an escrow account.

This is a continuation of that review which focuses on the legal fees paid by applicants before land use boards and the Board of Trustees (BOT) for various approvals.  At this time, the report is on payments to the current Village Attorney, Robert Spolzino.  Since the Zoning Board of Appeals (ZBA) has separate counsel, legal fees paid by applicants to the ZBA are not included at this time.

Explanation of Escrow

When a property owner submits an application to the Building Department, the paperwork is reviewed, and the required approvals are identified.  If the application has to be reviewed and adjudicated by one or more of the land use boards (ZBA, Planning, Harbor Coastal Zone Management Commission/HCZMC, Board of Architectural Review/BAR), the applicant must deposit funds in an escrow account to cover any expenses incurred by the Village during its review and approval process.  Outside experts, such as legal and engineering, are frequently required to assist the volunteer members of these boards in making their determinations.  Invoices submitted by these experts are paid from the escrow accounts and the balances are closely monitored to ensure adequate funds are available as the work continues.  If the escrow is not paid or drops below a minimum level, the application cannot proceed.

As noted in the previous article, the Village Attorney is permitted to bill these expenses at a rate of $375/hour for the first seven hours of service and $475/hour thereafter.  There is virtually no oversight of this arrangement.

Reports from the Village’s accounting system show a total of $215,563 of escrow funds paid to the firms with whom the Village Attorney has been associated since 2017.  This is in addition to the $3.2 million paid for other services, including $1.9 million for litigation.