Paterson paying rent on building it renovated using $180,000
By Jayed Rahman
Published: November 27, 2017
After spending $180,000 to renovate a Montgomery Street building two years ago, the city is now paying the private owner to lease space. This revelation by administration officials caught some council members by surprise last week.
Council members questioned a $4,200 payment to the William H. Butler Center. This payment covers rent for six months (July through December) for space at 147 Montgomery Street. The building houses the Neighborhood Assistance Office (NAO) which was moved by former mayor Jose “Joey” Torres from a government-owned building on Ellison Street to the Montgomery Street location in March.
“So we’re actually now paying the owner of the property a lease on a property we made an investment to rehabilitate?” remarked Kenneth Morris, councilman at-large. “”I’m a little uncomfortable with that.”
Morris asked whether the lease agreement between the owner and the city was approved by the council.
“It was brought before the council,” said business administrator Nellie Pou.
“And the council approved this lease?” asked Morris.
“Yes,” replied Pou.
“I’d like to see a copy of the resolution. I don’t recall approving this particular lease,” said Morris.
Torres told the Paterson Times in March the city was finalizing a lease agreement. However, it’s not clear whether that agreement was ever approved by the council. Maritza Davila, councilwoman at-large, recalled the lease agreement being approved by the council.
“I know we already approved it with a resolution in place with the monies that’s to go to this project,” said Davila.
“This was an agreement made by the previous administration that should not have been,” said council president Ruby Cotton.
William McKoy, 3rd Ward councilman, requested the administration provide an explanation. He wants relevant documents and a memorandum from the administration.
At the time, Torres said the $8,400 in rent for the space would be covered using federal Community Development Block Grant (CDBG).
“The money is not coming from the city budget. It’s coming from CDBG,” said Pou on Tuesday night.
The expenditure of federal funds at the Montgomery Street is the target of an FBI investigation. FBI agents raided City Hall and seized large cartons of documents.
“Is that investigation still pending?” asked Luis Velez, 5th Ward councilman.
“I have no idea,” replied Pou.
Domenick Stampone, the city’s chief lawyer, gave a different version of the same response.
Council members refused to approve the payment for the lease. The council also demanded more information before it considers approving a $328,659 payment for Overlook Park construction. Both items were pulled from the council’s payment of bills pending a discussion in December.
“We’re going to be in court if we don’t pay them,” said Cotton.
The building at Montgomery Street also houses former governor Jim McGreevey’s reentry program. McGreevey wanted to move out of the space, but a judge forced him to remain put. In the building’s basement is the Neighborhood Assistance Office. There was a proposal to open a satellite office for the Paterson Health Department at the site.
Pou said the health department will start operating from the first floor of the building in the next couple of weeks.
“We’re going to pay rent for the first floor?” asked Cotton.
“No, we’re not paying rent there,” replied Pou.
Some thought moving the NAO to Montgomery Street was a mistake.
“The Neighborhood Assistance Office was in a place everyone had access to in the downtown,” said Velez. He said the city did not have to pay rent at that Ellison Street space.
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