Opinion
May 11, 1998
Appeal from the Supreme Court, Suffolk County (Gerard, J.).
Ordered that on the Court's own motion, the appellants' notice of appeal is treated as an application for leave to appeal, and leave to appeal is granted ( see, CPLR 5701 [c]); and it is further,
Ordered that the order is reversed, on the law, with costs, the petition is denied, and the proceeding is dismissed.
The respondent and D J Refreshments (hereinafter D J) submitted bids for a food service license and concession contract to be awarded by the Town of Huntington (hereinafter the Town). The Town accepted D J's bid and the respondent subsequently commenced this proceeding to review the Town's determination. While initially denying the petition, upon reargument, the Supreme Court annulled the determination and remitted the matter to the Town Board.
The appellants correctly contend that the Supreme Court erred in applying General Municipal Law § 103, the competitive-bidding statute, to the selection process in this case. By its terms, the statute applies only to contracts for public work or purchase contracts ( see, Matter of Exley v. Village of Endicott, 51 N.Y.2d 426, 431). "[A] contract in the nature of a lease by a public entity as lessor or by which a franchise or license is granted need not, generally, be subjected to the competitive bidding process, for such a contract does not ordinarily involve an expenditure of public money" ( Matter of Citiwide News v. New York City Tr. Auth., 62 N.Y.2d 464, 470). The nature of the contract must be determined by examining the total character of the arrangement ( see, Matter of Citiwide News v. New York City Tr. Auth., surpa; Matter of Exley v. Village of Endicott, supra).
Here, in return for payment to the Town of a fixed percentage of annual gross sales, D J is permitted to use the Town-owned facility to conduct a specified business. In addition, D J is to make certain capital improvements, which will revert to the Town upon expiration of the contract. "Intrinsic to the operation of this license is the need for adequate facilities to carry out the proposed business" ( Matter of Citiwide News v. New York City Tr. Auth., supra, at 472). The ownership of the improvements is of incidental benefit to the Town and that aspect of the transaction does not alter the essential character of the arrangement as a licensing agreement. Consequently, the transaction does not fall within the ambit of the competitive-bidding statute ( see, Matter of Citiwide News New York City Tr. Auth., supra, at 473). Since there was no violation of General Municipal Law § 103 and the respondent has not otherwise demonstrated that the Town's determination was arbitrary and capricious, the petition is denied and the proceeding is dismissed.
In light of our determination, it is unnecessary to consider the parties' remaining contentions.
Sullivan, J.P., Pizzuto, Altman and Friedmann, JJ., concur.