Gary Melius’ rise through Long Island’s cozy political system

Gary Melius has transformed himself from onetime West Hempstead street tough to owner of a Huntington castle that became Long Island’s unofficial political clubhouse. He made his way from the outside in as a player with powerful friends and a practical understanding of the day-to-day workings of the Island’s cozy, transactional political structure.

Melius, who was shot and wounded four years ago in the shadow of his greatest accomplishment, Oheka Castle, didn’t invent Long Island’s way of doing business. But through him, a portrait emerges of how the game is played and how hard it may be to change.

By the mid-1970s, Melius was making his way on Long Island, having emerged from five sets of criminal charges without jail time. Largely responsible was brilliant, politically connected lawyer Richard Hartman, who became one of his two great mentors. The other was Alfonse D’Amato, and the ’70s were when D’Amato and Hartman first scored big.

Hartman won police contracts that made the counties’ officers among the highest paid in the country. D’Amato rose from Hempstead supervisor to U.S. senator.

D’Amato toughed out an investigation into kickbacks by town employees to the Republican Party; allegations of favoritism in placements into subsidized housing in his hometown, Island Park; and a district attorney’s report that concluded politically connected developers had received below-market leases on valuable properties in Mitchel Field.

Melius, meanwhile, bought Hartman’s headquarters building and, using politically involved lawyers, built a property portfolio worth millions. He joined civic boards. His foundation, named for his mother, made the first of what would become $2.8 million in charitable donations. He gave $1,000 to D’Amato’s 1980 Senate campaign, which he would follow over decades with more contributions to a range of politicians.

One way to measure the sustaining power of Long Island’s network of insiders is to witness how Melius struggled during the ’90s, when, operating outside his network of political connections, he tried to rebound from a financial meltdown.

A recession and tax law changes sent his finances reeling. Five of his companies went into bankruptcy, and at one point he was more than $20 million in debt. He also owed more than $250,000 to casinos, most of it to ones owned by Donald Trump.

Trying to rally, he managed boxers, invested in a sexploitation film and joined forces with a prodigal member of the Gucci family in a fashion business. Most of these ventures failed.

In a last move, he tried to start a casino on a remote upstate Indian reservation with a Long Island partner.

Gary Melius received an unexpected call in 1988. It came from a broker for a Japanese billionaire facing prison time for a fatal fire in a hotel he owned that lacked sprinklers. He wanted to buy Oheka Castle.

The billionaire was moving assets out of Japan as he awaited his fate. He paid a recorded price of $22.5 million for Oheka. He also allowed Melius to live at the castle and manage it.

But soon Melius began amassing code violations for fire and building hazards and illegally hosting weddings and flea markets. By 1997, he owed more than $600,000 in taxes and Huntington had sued to shut the castle down. Melius waged a consummate counteroffensive, though, that showed his rising skill as a power player. Despite his past record, the Huntington Town Board allowed him to operate Oheka commercially. The board placed significant restrictions on the use of the castle, but within a few years it had eliminated or eased virtually every one of them. In 2003, Melius bought back the castle for $6.9 million.

As Oheka thrived, a Melius property in Freeport bled money. Called Brooklyn Water Works, it was anchored by an abandoned 19th century pumping station. Melius had tried to redevelop the property unsuccessfully for two decades. He said Water Works had cost him millions of dollars and was waging legal war over the property with the village.

Freeport’s attorney told police in 2009 that Melius employed threats against him to pressure the village to settle.

How he worked his way out of the project at public expense reveals how Melius had come of age as a power broker. 

In 2009, he threw his support and contributions into the successful insurgent mayoral campaign of Andrew Hardwick. Then he quickly cemented ties with the newly elected county executive, Edward Mangano.

Their two administrations would spend a combined $11 million in public money on the property, including $6.2 million that – based on questionable valuations – Nassau County spent to buy it. And the village lawyer never pressed his complaint. He became an Oheka regular.