Nearly a decade after DEC commissioner ordered Rainbow Lake dam near Indian Lake removed or repaired, the structure was taken down last year
By Zachary Matson
As early as 1970, safety inspectors described Rainbow Lake Dam near the hamlet of Indian Lake as dangerous and urged action to lower the water level. The U.S. Army Corps of Engineers in 1979 deemed the dam “unsafe, emergency.” By 2004, the state Department of Environmental Conservation called for it to be removed if it no longer served a purpose, highlighting its potential to cause loss of life if it failed.
The dam’s owners, a tangle of companies linked to New York City developer Gary Spindler and a religious nonprofit in Brooklyn, ignored a 2013 order from the DEC commissioner requiring them to submit an emergency action plan and skipped a judicial hearing. DEC lawyers referred the case to the attorney general’s office, which prodded the owners to sign a 2015 consent order requiring, among other conditions, they start fixing the dam by April 2016, a deadline they missed. The state sued in December 2018.
State lawyers asserted that the owners’ unresponsiveness “amounts to a callous and wanton disregard for their legal duty to mitigate risk to life and property.” It took almost four more years to compel the owners to take down the dam.
Under court order, Rainbow Lake Dam’s owners ended nearly two decades of sustained state pressure and removed the structure last year, but not before contesting their legal responsibilities.
The dam was built in 1929 to impound a small recreational lake “in connection with a resort type operation,” according to state records. No resort operates at the property near Starbuck Road southeast of Indian Lake, but the dam remained amid a web of ownership interests.
Deeds show ownership of parcels that included the dam transferred in 1981 and 1994 to Jason Roberts Development Corp. of Delaware. All of the shares to Jason Roberts, valued at $1.5 million in 2000, are owned by Gemilas Chesed Ach Tov, a religious nonprofit listed at a Brooklyn residence. A New York company with a similar name, Jayson Roberts Operating Corp., operates the Delaware corporation, with Gary Spindler, who owns numerous parking garages and other buildings in New York City, as chief officer.
Spindler corresponded with DEC staff about the dam and paid property taxes from his parking business. Lawyers for the state would eventually refer to the ownership as a “mess of unauthorized and dissolved shell corporations.” Lawyers for the dam owners argued the companies shielded Spindler, his son, Adam Spindler, and the nonprofit’s director, Joseph Hornstein, from personal liability for maintaining the dam.
In an interview with the Explorer, Spindler said he managed the property on behalf of a business partner’s charity, which envisioned turning an old lodge into a summer retreat. Instead, the property turned into a yearslong battle with the state that he estimated cost $500,000 to $750,000.
“No good deed goes unpunished,” he said.
Spindler asserted the dam did not pose the threat suggested by its hazard classification and said it weathered big storms. He said the state rejected an offer to transfer the property to state ownership.
“Never once in 100 years did we have issues with our dam,” Spindler said. “Just because it’s in the ledger as dangerous, it wasn’t really dangerous to anyone.”
Dam safety inspectors saw it differently, and for decades reported water seepage, cracks in the concrete and overgrown banks. After DEC filed a 2013 complaint alleging the owners failed to submit its emergency action plan, neither Spindler nor anyone representing Jason Roberts responded or appeared at a hearing. DEC Commissioner Joe Martens ordered the owners to submit the plan and pay a $10,000 civil penalty, but Jason Roberts and Spindler failed to comply.
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Spindler told DEC staff the company had “intentionally defaulted … because the property on which the dam is located was not income-producing,” according to DEC court filings. The attorney general’s office induced a 2015 consent order requiring repairs or removal of the dam in 2016. DEC issued work permits. Spindler and Jason Roberts missed the deadline.
The attorney general filed the 2018 complaint against Spindler and Jason Roberts to force repairs or removal and as much as $1.4 million in penalties.
Spindler’s lawyer moved to dismiss the suit. The state filed an amended complaint in late 2019, this time also naming Spindler’s son, the nonprofit and Jayson Roberts Operating Corp. as new defendants. Their lawyer again argued that none of the individuals could be held responsible for maintaining the dam which, according to property records, was owned by the Delaware corporation. “The deed to the property where the dam is located expressly exculpates” all parties not listed on the deed, the lawyer argued.
“Defendants have created a series of corporations in a vain attempt to shield themselves from liability,” the state’s lawyers responded.
In June 2021, about a year after a judge denied the motion to dismiss, Spindler and the other owners agreed to remove the dam and pay a $150,000 penalty. The corporate owners and Gemilas admitted liability for conservation law violations. Spindler, without admitting wrongdoing, paid for the dam removal and covered the penalty. On Sept. 26, Nicholas Buttino, assistant attorney general, notified the judge that the dam was gone.
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