Property owners sue over blight designation — Newark (NJ) Star-Ledger, 12/10/04

Newark accused of conspiracy to take land

By Jeffrey C Mays

After intense lobbying efforts to keep their neighborhood from the wrecking ball failed, residents and business owners of the Mulberry Street area filed a lawsuit in Superior Court yesterday challenging the city's declaration that 13 acres of the downtown neighborhood is blighted, as well as the administration's intention to reconstitute the area as a community of upscale condominiums.

The lawsuit claims that the city "conspired" with the Mulberry Street Urban Renewal Co. to take the valuable land for below-market rates because of its proximity to the planned $310 million, 18,000-seat arena for the Devils. "The Mulberry Street area was selected as a target for 'redevelopment' at the behest and urging of the private entities ... in a deliberate attempt to enlist the power of government on behalf of private entities so as to avoid the necessity to acquire land for development through the operations of the marketplace," wrote attorney John Buonocore Jr.

Members of the city council and the mayor also were swayed into favoring the project because of campaign contributions made by the planned developers, and the area simply does not meet the legal requirements of a blighted area, the suit says.

"A blighted area means people aren't paying their taxes, it's a slum area, drugs, crime. Everyone's taxes are paid. Blighted means lots of code violations. Blight does not mean we can use it to make more tax revenue," said George Mytrowitz, head of the Mulberry property owners and residents coalition and owner of Market Body Works on McCarter Highway. His group represents 27 property owners in the area the city considers blighted.

Council members deny being swayed by campaign contributions.

The lawsuit comes a month after the council approved the recommendation from the planning board that the area be considered blighted and more than two years after the project was announced.

The 13-acre area is near Route 21 and the federal courthouse. It is a mix of industrial businesses, small shops, parking lots and homes. Mayor Sharpe James says the condominium project, combined with the arena and surrounding development such as a hotel and office space, will spark a revival of Newark's downtown, and by providing a larger tax base, the entire city.

Buonocore said that is not reason enough to declare an area blighted. "Whatever the merits of this project are, you can't do it on someone else's land. Whether this is the best thing that happened in Newark is irrelevant. They can't take private land for what appears to be a predetermined outcome," he said.

Traditionally, eminent domain has been used to take land for clear public uses such as a highway or school. However, in the past couple of decades, eminent domain laws have been used to take private land for private use with the reasoning that it will create more taxes.

The Michigan Supreme Court recently reversed a case cited to justify the use of eminent domain for private development, and the U.S. Supreme Court agreed to hear arguments in a case about eminent domain for private development. Kelo vs. New London, Conn., is a case in which several homeowners are trying to stop the city from using eminent domain to take their land so that developers can build a hotel and office space. It's the first time the court has taken up the issue in 50 years. A ruling is expected in June.

"We are going to do what we have to do to get it turned back the other way," said Mytrowitz. "We just want to stay where we are."

Response: Letter to the Editor, 12/23/04

The proposed "redevelopment" of Mulberry Street in Newark ("Property owners fighting blight tag," Dec. 10) is another example of an archaic law run amok. Local activist George Mytrowitz is absolutely right when he says, "A blighted area means people aren't paying their taxes, it's a slum area, drugs, crime. Everyone's taxes are paid. Blighted means lots of code violations. Blight does not mean we can use it to make more tax revenue."

In 1947, the framers of New Jersey's present constitution put it almost exactly the same way when they included a provision allowing redevelopment laws. However, New Jersey courts have stretched the definition to the point where a parking lot in Princeton qualified as an area in need of redevelopment simply because it was "yesterday's solution." The redevelopment law should be repealed, putting an end to these rampant abuses.
— Robert Moss, Bloomfield

Newark Star-Ledger: www.starledger.com

News Release issued by The Mulberry Street Coalition, 12/10/04

Newark property owners file suit to stop Mulberry Street Redevelopment Plan:
Conspiracy and conflicts alleged

A group of city homeowners and businesses have filed a lawsuit against the Newark City Council today to overturn the city’ss attempts to condemn their neighborhood and give their property to a private developer.

The suit filed on behalf of the Mulberry Street Coalition by attorney John Buonocore Jr. of Morristown, alleges that city officials worked in concert with private developers to use the government’s power to target the area for redevelopment and thereby help the developers avoid the necessity of having to acquire the land through normal marketplace negotiations. The council voted 5-3-1 on November 3 to condemn the neighborhood.

"This is, plain and simple, a land grab on the part of private developers working in a conspiracy with government officials to take these people’s property so the developers can make a fortune redeveloping the site," said Buonocore.

The Mulberry Street redevelopment plan includes razing 14 acres of homes and businesses and replacing them with up to 2,000 housing units and 180,000 square feet of retail space only a few blocks from controversial Newark sports arena. The redevelopment plan was sprung on the community last year without debate or consultation with East Ward residents.

Buying influence
The suit also alleges that after initial efforts to get a redevelopment hearing before the Newark Planning Board failed in May and June of last year, “there ensued a concerted effort by the private entities (developers) to purchase influence with officials in city government, specifically with members of the governing body and with members of the governing body who had voted to rescind the 2003 Planning board resolution” on the redevelopment.

The suit notes that tens of thousands of dollars were contributed by the developers and persons related to their business to members of the Newark City Council. Emilio Farina, a former city council aide and a partner in Newark Redevelopment Corp — one of the developers — served last spring as the fundraising chairman for Councilman Hector Corchado.

George Mytrowitz, spokesman for the Coalition said the donations helped change some votes of city council members who were originally opposed to the plan. He has since written to the U.S. Attorney’s office asking him to investigate the contributions.

“When the developers encountered problems getting their plan through the city council, they started donating heavily to the council members and they managed to get their project revived. This is at best a pay to play scandal and it smacks of political corruption,” said Mytrowitz.

Mytrowitz said several council members, particularly Besse Walker and Hector Corchado should have been excluded from the November 3 Council vote to declare the area in need of redevelopment. The conflicts of interest are noted in the lawsuit, which states that: “Members of the governing body were improperly influenced by personal and financial connections,” to the developers.

Attorney Buonocore said that the city’s efforts to impose large scale redevelopment on area residents by threatening to take their land and give it to a private developer is an improper use of the state’s redevelopment law. He said that while he appreciates the city’s efforts to try to boost tax revenue by wholesale redevelopment, the city does not have the right to condemn a thriving neighborhood that does not meet the threshold definition of an area in need of redevelopment.

“Use of the redevelopment laws to achieve an increase in municipal taxes, or to achieve the highest and best use of the real estate are irrelevant considerations under the law,” said Buonocore.

“The bottom line is that governments in New Jersey can only legitimately take private property for a purpose that serves the public good. Governments can’t take private property and hand it over to a private developer so the developer can maximize his profits,” said the attorney.

Mulberry Street Coalition: info@mulberrystcoalition.com
Thom Ammirato: 973-403-7836