Power struggle BLRA agrees to share information with City Council

Faced with a threat of being disbanded, members of the Bayonne Local Redevelopment Authority have agreed to give the City Council access to previously closed-session meetings, provided the City Council keeps the information confidential.

The BLRA is an autonomous public body created with the express duty of overseeing the redevelopment of several key pieces of former industrial and military properties in Bayonne, such as the former Military Ocean Terminal.

But recently, the City Council threatened to dissolve the BLRA after it made a hurried deal to sell a portion of the former Military Ocean Terminal to the Port Authority of New York and New Jersey for $50 million, helping close a town budget gap.

The BLRA had apparently held private negotiations with the Port Authority for several months, and the City Counncil – which has scheduled a town meeting to hear other proposals for the property on Nov. 23 – was unaware of the transaction until the BLRA voted to approve the contract on Sept. 20.

The council reacted at its Oct. 10 caucus by drafting an ordinance that would dissolve the BLRA, but agreed to table the ordinance at its Oct. 17 meeting as a peace gesture toward the BLRA.

Don’t rush your vote

Council members asked the BLRA to hold off a second vote for the Port Authority contract long enough for the City Council to hear other proposals for the 123-acre property.

The BLRA – in its rush to get the Port Authority agreement passed on Sept. 20 – failed to meet the letter of the Open Public Meetings Act. To avoid having its vote challenged by a City Council lawsuit or a suit brought by another potential developer, the BLRA has 45 days from Sept. 20 to vote again.

Apparently stung by the council threat, the BLRA recently agreed to hold off its next Port Authority vote, although two of its five members voted against the postponement, saying they wanted the BLRA to seek other bidders for the property.

At the BLRA’s Oct. 18 meeting, Commissioner James Pelliccio lambasted the BLRA for failing to properly communicate with the City Council or provide adequate information to the community, saying that while the BLRA may not have done anything wrong, it had created a perception in the community that it had.

He said City Council members on the BLRA had failed to carry out their task of keeping the City Council informed of matters going on within the BLRA, and thus created the conflict between the two public bodies.

New mayor makes a request

New Acting Mayor Terrence Malloy – in one of his first public appearances as mayor – requested the BLRA hold off the re-vote until the City Council could review other potential proposals.

Pelliccio did not want to stall the vote, but along with Commission Marguerite Baber, wanted to vote down the Port Authority contract and seek other bidders.

He said he had requested numerous times that the BLRA review other proposals, but had been ignored.

Councilman Gary La Pelusa said the Port Authority deal came as a surprise, because Council President Vincent Lo Re, who also serves as a commissioner on the BLRA, had promised to hold hearings on other offers.

Lo Re said the BLRA had refused to consider a proposal for a container port at the site because contracts with the developers of residential property adjacent to the 123-acre site included restrictions against container operations.

The BLRA did vote to table the vote on the Port Authority contract until its Nov. 2 meeting, and agreed to consider council recommendations for the development of that portion of the former Military Ocean Terminal.

The BLRA also agreed to share confidential information with the City Council in the future by both inviting City Council members to closed sessions of the BLRA, as well as allowing reports at closed sessions of the City Council.

Although the BLRA modified its rhetoric from the Sept. 20 meeting when the commissioners and its advisors stated the City Council could do nothing to derail the Port Authority deal, BLRA Commissioner Howard Fitch continued to support the contract for the Port Authority, saying the contract provided the city with revenues needed to balance two years budgets.

‘Trying to do the best’

Fitch, like Baber, however, expressed discontent over threats by the council to dissolve the BLRA, saying the BLRA was an autonomous agency.

“We are all good people trying to do the best for our city,” he said.

Joe Bauman, a development consultant for the BLRA, said the BLRA was caught between two impulses, to provide operating revenue to the city and to prepare the former military base for development. This often means that the BLRA must act quickly to get funds to balance the city budget, sacrificing some of the long term potential some parcels may offer.

La Pelusa, however, said the City Council had used its only option to get the BLRA to modify its intractable position on the Port Authority. But he said the vote to postpone the Port Authority vote until after the City Council considers additional proposals was a positive sign.

Problem with BLRA

The BLRA was created by the City Council to oversee the acquisition and redevelopment of MOTBY, a property whose development is estimated between $3 billion to $6 billion.

Critics, including some on the City Council, said the BLRA’s ability to award contracts without bidding and without local oversight is a problem, and city officials want more public input into the selection process.

Under redevelopment laws passed by the state in the 1990s, bodies like the BLRA can operate without having to comply with the usual bidding laws, or as in the words of Fitch at the Sept. 20 meeting, “We can sell the land for a dollar if we want to.”

Bauman said the deal with the Port Authority brings a lot of things lacking in any private offer, such as the ability to get needed transportation improvements done off-site. These include rail links, improvements to Route 440, and a possible new interchange for the New Jersey Turnpike.

“We don’t have a lot of time,” Bauman said. “The city needs $45 million to meet its budgetary needs. If we don’t have it by June 30, there will be cash flow problems.”

But Pelliccio disagreed.

“Let’s face it; we blew it.” Pelliccio said. “But I think that part of the problem is that the city can’t get its financial house in order. Someone asked at one of the meetings last month, ‘Where does the money go?’ I think that is a good question. But that person’s question was answered in silence, and that is not acceptable.”

A better offer for the MOTBY?

Although only stalled by a technicality, the $50 million Port Authority deal for the purchase of 123 acres of the former Military Ocean Terminal may not be the best deal for the city.

Ports America, one of the world’s largest port operators, said they will offer to pay $75 million for the site and has agreed to meet the restrictions against container port operations.

Stephen Edwards, president and chief executive officer of Ports America, said his company is scheduled to make a presentation before the City Council on Oct. 23, and his company has the ability to close quickly on the purchase agreement.

“I think we’re the right operation to use the property efficiently,” he said during a telephone interview. “Fortunately, we have a sizeable roll-off operation.”

Ports America is well aware of the MOTBY facility, since they were formerly part of International Terminal, which conducted operations when the facility was still a military base.

Ports America will present a deal for the purchase and redevelopment of about 92 acres of the Maritime District.

“We are prepared to purchase the site for $75 million and develop it as a combined roll-on/roll-off and automotive import and export facility,” Edwards said in an Oct. 17 letter of interest to the Bayonne Local Redevelopment Authority. “We have conducted our due diligence on the site, are ready to move to contract with you immediately, and are prepared to close the purchase within 60 days. We will provide you with a $30 million security deposit upon contract signing.”

Along with its affiliated companies, Ports America is the largest operator of marine terminals and the largest port side automotive producer in the United States. The company handles over 620,000 import and export automobiles from more than 600 ship calls in New York Harbor.

The company also handles roll-off operations in Baltimore, Md., Jacksonville and Tampa, Fla., New Orleans, and California.

“We won’t need another operator. We will run the facility ourselves,” Edwards said. “We are fully financed and hope to close quickly.”

Ports America, he said in his letter, will turn the maritime district into a showcase facility that will also provide a substantial number of union and related jobs for Bayonne and surrounding communities.

email to Al Sullivan


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