Mayor Andre Sayegh’s administration’s hand-picked developer for the renovation of Hinchliffe Stadium and a housing project in the Totowa section may seek a long-term tax abatement deal with the city.
Language in the 82-page redevelopment agreement says the developer, Hinchliffe Master Urban Renewal, L.P., made up of BAW Development and RPM Development, “intends” to seek a tax abatement or payments in lieu of taxes (PILOT) deal. Alternatively, the developer may seek a 10-year or 5-year local tax break under existing law.
Moreover, the agreement contains elements that prompted the president of the City Council to call it a “travesty:”
- The city “agrees to consider in good faith” redevelopment area bonds, according to the agreement. It isn’t clear how much the Sayegh administration could potentially seek to borrow for the project.
- “No member, officer, shareholder, director, partner or employee of Redeveloper, and no member, officer, shareholders, director, partner or employee of the members of Redeveloper shall be personally liable to the City, or any successor in interest, in the event of any Default or breach by Redeveloper or for any amount which may become due to the City, or their successors, on any obligation under the terms of this Redevelopment Agreement,” reads the agreement. This provision allows the developer to walk away from the project at anytime, according to council members.
“Ask for a copy of that redevelopment agreement,” council president Maritza Davila told the public on Tuesday. “What is in the redevelopment agreement is a travesty.” She and her colleagues were never provided the redevelopment agreement until after the City Council rejected the lease agreement that shifts site control from the Board of Education, which owns Hinchliffe Stadium, to the city and the developer.
While criticizing the agreement, Davila erroneously stated the developer is contributing a paltry $50,000 to the project. The agreement requires the developer to hold $50,000 in escrow to pay for “City Costs,” defined as expenses incurred by the government for professional consultants for the project like attorneys, engineers, technical experts, planners, and financial consultants, according to the agreement.
Councilman Flavio Rivera asked the developers at a public meeting to state their total monetary contribution to the project; however, neither could provide a dollar figure to the council.
Redevelopment agreement not public
Sayegh has not made the agreement public. Neither he nor his chief of staff Kathleen Long responded to written questions about the specific sections of the agreement on Thursday morning.
Sayegh and Long also did not respond to request for a copy of the agreement on Wednesday.
What the mayor and his public relations team has made public is a one-minute, twenty-seven-second video for a public meeting to rally his supporters to pressure the governing body into approving the controversial project.
Sayegh’s public relations team is made up of Long and recently hired Jessica Diaz, daughter of the mayor’s longtime political ally. Long is paid $100,000 and Diaz $60,000 per year to disseminate information to the public.
“This is our once in a lifetime opportunity. We need your support to restore this treasure to its former glory,” Sayegh says in the short video without providing details about his proposal. He tells the public to attend a meeting at John F. Kennedy High School to “rally behind” his effort.
Council vice president Michael Jackson called Sayegh’s video move a “foul-play.” Sayegh posted the video after he failed to get the City Council to re-consider the lease agreement through an obscure “emergency” provision in the law.
“It is insulting to have the mayor go in front of Hinchliffe Stadium and do these videos saying we don’t want to see it redeveloped,” said Davila.
The city has spent $3.7 million, funds approved by the council, to repair Hinchliffe Stadium. The city broke ground on phase one of repairs two years ago, but lacks the funds for the full restoration of the stadium.
$70 million to restore Hinchliffe Stadium and build housing complex
Baye Adofo-Wilson of BAW Development has said the project will cost $70 million. It includes 65 low-income housing units, a restaurant, 300-space parking deck, and gallery space for Negro Leagues history.
It is not clear whether the developer will restore the stadium first or build the low-income housing project that will further concentrate poverty in a poor area.
“Community do not believe this is the right developer for this project. This project is not right,” said the council president.
Adofo-Wilson’s default on a $2.6 million loan while he was head of the Lincoln Park Coast Cultural District in Newark has raised fresh concerns about his viability as the developer in the project. He has countered the concerns by stating that default was almost a decade ago and that he has many successful projects under his belt. He also noted the lender was ultimately paid back the loan amount.
Sayegh wants to give the developer $40 million in state tax credits for the project. His administration has to file the tax credit application by Jul. 1, 2019. Neither the Sayegh administration nor the developer has made public a capital stack outlining the sources of financing for the project.
The low-income housing element will allow the developers to tap other government funding sources. The agreement mentions the developer will seek funding from the New Jersey Housing and Mortgage Finance Agency (NJHMFA).
Sayegh wants the council to approve an agreement the school board approved earlier in the month. School board members were never provided the redevelopment agreement before the vote.
School board vote
“All of the school board members that approved the lease without having any of the facts or any information, I’d consider looking at it again. This is not right for our children,” said Davila on Tuesday night.
Three school board members – Joel Ramirez, Manny Martinez, and Emanuel Capers – were present at the meeting.
Ramirez, who voted against the lease, said he felt vindicated.
Capers defended his support of the lease. He narrowly considered the lease agreement, he said, while noting the deal with the city includes repairs to other fields for school children.
Sayegh repeatedly mentioned the benefits a restored stadium will provide for “our children,” but a tax abatement will mean fewer tax dollars going to Passaic County and local schools.
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