Is this really appropriate for a Councilperson to be posting? Funny how this info also mysteriously showed up on NJ.com WO Forum under westorangevoice-

Lisa asks: " Is this really appropriate for a Councilperson to be posting?"
I can't imagine why you would think that inappropriate. You are of course free to respond to any councilperson's post with which you disagree.

"The 2006 Redevelopment agreement with Prism specifies that tax delinquency is an event of default which could lead to the town’s withdrawal of Prism’s exclusive right to redevelop. The township administration filed a notice of default to Prism last year on a previous delinquency. Prism promptly paid approximately $135,000 in back taxes and interest penalty to cure that default."

Then the township administration should file a notice of default again. Maybe this is what Prism is waiting for.

Thanks Joe!!

There is absolutely nothing wrong with Councilman Krakoviak including information readily available to the public in his blog posts; my questions would be towards what end and why focus on Prism who is only one of hundreds of property owners similarly in arrears?

Though lacking any better idea or alternate entity with the requisite resources, Mr Krakoviak has opposed dowtown redevelopment since his coming to public prominence 4 years ago. His opposition was the central platform of his successive campaigns for election to local office. I get it; he's intellectually opposed to redevelopment and he's no fan of Prism.

What is also true, however, is that redevelopment hasn't cost the Township a penny...Prism pays more taxes on the parcels than any of the previous owners...it reimburses the Township for every penny it lays out...and though it has filed tax appeal paperwork each year, it has yet to pursue heaing for any property in any year.

They've stayed the course for 6 years and paid enormous carrying charges on properties that have yet to produce a penny in income. They are relying on income from other endeavors to do this and have some cash flow problems as a result but, have consistently paid all taxes, fees and penalties.

Again, hwo many other property owners are currently late with their 1st quarter tax and why shouldn't you be as concerned about them?

For the record, I appreciate the Councilman's coucil updates and his transparency. In my opnion, I just think this goes beyond transparency. Just my opnion and you are all free to disagree-

Mr. Englert, you posed the question why Councilman Krakoviak is raising concern with Prism's lateness in paying their taxes and not with so many others who are also late in paying theirs. My response was "In my humble opinion, the difference between Prism and the other delinquent property owners is $6.3 million." Your response above justifies the $6.3 million bond and should stand on its own, without the need to equate Prism's delinquency to the other delinquent property owners who are not involved with any type of bonding transaction with the township. Ms. Morelli put this another way when she stated "have Prism assume the $6.3 million and she and the other objectors will stay off Prism's back." I may be paraphrasing her statement.

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Gary Englert

11:57 am on Thursday, February 14, 2013

Concerned:

Then, in my humble opinion, the "difference" that concerns you remains much ado about nothing.

I appreciate the updates and information from Councilman Krakoviak. If only the Board of Education was as forthcoming when it comes to transparency.

Concerned:

Your response is somewhat convoluted and difficult to follow and Mrs. Morelli's position is fundamentally illogical.

Should the Township forego the necessary rebuilding/resurfacing a particular street because some number of the residents residing on it are behind in paying their property taxes?

Should any one particular property owner bear the cost of replacing/renovating a municipally owned public thorofare?

I'd say the answer to either question is a resounding "no" but, while Prism will provide dedicated funds to pay the for the renovation of the Township owned infrastructure surrounding the battery factory, the Township's modest contribution is to underwrite the bonds that will provide advantageous financing not available any other way.

Why anyone thinks this is a "bad deal" for the Township is beyond me, as it's analogous to having someone else repave the driveway you've financed and giving you the money to make the payments.

I'd take that deal any time!

Mike B, a resident for 40 years
Joe krakoviak is a naysayer on almost everything that comes before the town council. Its obvulious his negative positions are blatently self serving and politically motivated to establish his position in town as a negative force against all town projects. He has a right to his negative voting and to criticize Prism on everything.
Even with late oayment of property taxes, the township till receives the payments with interest penalities. A much superior financial position than no tax income from the Edison properties.
My opinion is that the Edison projects long term benefits be considered. Our progressive elected officials going back 10 years now, decided the Edison project was good for W. Orange. Our town has an old downtown Main Street area that needs
continuing support to keep it viable. The Edison property is a deteriorating anchor ruining all the years of positive efforts to improve and restore Main Street in our town. Prism is now on the edge to start constructuon to restore this eyesore. Prism is in the construction process to do the very same thing in Bloomfield at the old G.E. Site. Go see it and be impressed!

So lets ignore old Joe Krakoviak's tiresome negative posturing and look to and support Prism's efforts to turn a derelect building on our critical commercial atreet into a eesidential project that w. orange will be proud of marching into a better main street duture

I think we need a few stanzas of Kumbaya around a camp fire.

Concerned:

While late payment of a tax bill may well give the Township the right to declare Prism in default, again the question would be toward what possible end?

Give the clear lack of income from the redevelopment properties themselves, that Prism is obviously relying on income from other projects to carry ours and their track record of consistently paying all taxes, fees and requisite interest/penalties when necessary...just how egregious are their late payments?

Not so egregious at all.

Mr. Englert, I believe we have finally come to a point of agreement. Cutting to the chase, as provided in the contract, Prism's delinquency in payring their taxes is grounds for the administration and council to declare Prism in default, but due to the practical reasons you enumerated, they also have the option not to enforce this portion of the contract, and it is clear that they do not intend to do so. EOD.

Concerned:

And for various good and sundry reasons enumerated here and elsewhere, there is scant justification for anyone to oppose this project and look a $250 Million gift horse in the mouth.

Prisms late payments are a reflection of thier inability to perform as promised.
Now it Is a waiting game.

Tom:

Prism's payments (late or otherwise) are a reflection of their ability, indeed there willingness, to perform as promised...having stayed the course and done so during the worst economic upheaval in any of our lifetimes.

Once again, take a cruise around the Internet and see just how many constrion/development projects have been abandoned, across the country, since 2008.

If you do so, you'll have more than ample reason to think far better of Prism and the fact that downtown redevelopment will become a reality after 50 years of talk.

Had the Township had as much faith in itself as Prism does...and had issued the redevelopment area bonds proposed in 2009...the project would be completed and occupied and providing even greater revenue to the Township than it will under the current financing plan.

You may thank Messrs. Krakoviak, Schmidt et al for sowing the seeds of fear that curtailed that initiative and delayed the project another three years...not Prism.

I have a problem with this CIty and Developer behind close door buddy buddy deals. As we all can see, the CIty is desperate for this monstrous abandoned building be taken and developed. So in order to do facilitate that, they gave Developer all kinds of goodies that citizens don't get such as:
broken contracts ok, and just wait until construction extras,
late on large payments,
borrow money in their name (bonds) and make citizens pay it,
and tax abatements.
Now in order for the CIty to give, it must receive first. So property taxes goes to hell. W O monthly taxes are higher than mortgage payments which means house values depreciate. Take from the credit of all to go give to a few.
And why should new apartments have tax abatements when a citizens demolishes his house and builds new his tax bill nearly doubles. All those new apartments should pay according to tax assessment like everyone else. We all know that it is not economical feasible, meaning its a bad deal, so they will now stick residents with a bill.
Good luck W O. Sell before house collateral is bonded by the CIty.

raa:

Rather clearly, your basic knowledge of the history of this project, and understanding what has and hasn't happened and why, is minimal and you are ill-equipped to comment intelligently about any aspect of it.

Once again Gary is serving Kool-aid... Now drink up

John McKeon, pay special attention to the empty lot behind the fence, as you ride by it on St. Patrick day, That empty lot is a testament to your reckless destruction of West Orange. From the loss of old growth forests, to allowing builders to break the law and handing out variances like candy, your vision for West Orange was a failure.

You sold out West Orange to your friends so they could make some money, and you could gain political clout with hopes of one day being elected to a higher office. Was it worth it ?

Gary Englert writes:
"investment of $30 Million in excess of the property's possible worth on buildout needed to be made."
Exactly why this is a bad idea put forward by financially irresponsible politicians with an edifice complex.

What you call nonsense, I call facts. And the proof is readily available to anyone who wants to read the old news stories on developers who broke the law in West Orange, only to receive minimal fines and or a slap on the wrist.

My historical perspective of the selling out of and over development of West Orange, is based on facts. Over 30 years of residency, newspaper articles, town council meeting notes and research, is not "nonsense", it's fact. I care about this town enough to have followed, with a passion, everything there was to know about every major development in the last 30 years.

And how would you know none of the Principles of Prism Capital Partners LLC are friends or intimates of any of the previous or present members of the administration? Legally, Prism does not have to name their investors. Does "Trent Bond Group" ring any bells?

Paul P:

The "facts" you proclaim to exist are nowhere in evidence here and you are painting the last 30 years with a broad brush...all the while failing to acknowledge John McKeon (at whom your initial criticism was directed) was Mayor for just 12 of them.

Whatever your perceptions might be, 85 percent of the Township's land mass was developed by 1980 with approvals to develope much of the rest of it already in hand of the owners of that land which wasn't.

The Township can't unilaterally restrict legal development of private property; at best, it can mitigate that development and limit its impact...and the McKeon Administration did yeoman's work in doing just that.

Nobody in a decision making position or with a fiduciary responsibility to the Township is an investor in Prism Capital Partners...and they have certified that.

If you have any evidence that is not true, do bring it to the proper authorities...and who, pray tell, is the "Trent Bond Group?"

To quote Yogi Berra "It's deja vu all over again" I am hoping we have some means to legally get rid of Prisim and start again with a better idea for downtown.

Adam Kraemer:

As usual, your commentary is devoid of any historical perspective, let alone any common sense.

It took 50 years to get us to this point and any of those with the interest and resources to get involved with the project all agreed it had to be essentially the same scheme as currently envisioned...and Prism's was chosen as superior.

There's no reason to go back to the drawing board only to achieve the same result.

My God! the fact that it took 50 years to get to this point is reason enough to scrap the projects!

Prism has demonstrated time and time again that they are not able to bring this project forward. They are unable to pay their financial obligations and have stated that they do not have the financing required to proceed. They have also published press releases that are at odds with what has been approved and have yet to gain any of the requisite approvals of the histroic commission. This is not the vision any of the hard working tax payers had for re-development and certainly is visions of the problems we will encounter for the next thirty years should Prism be allowed to continue to propagate their ill towards the good folks of West Orange.

Tom and wohopeful:

The fact that it has taken "50 years to get to this point" is compelling evidence that all the possibilities have been debated to death, all the alternative examined and, with people willing to invest the requisite resources, what we've got is as good as it's ever likely to get.

As to the rest of wohopeful's inaccurate overview and prognosis, there is only one word needed to describe it: nonsense.

Facts are far from nonsense. What is truly nonsense is the people who complain that this deal has been 50 years in the making and because of that we must stay the course and live with the negative results. Well thatis not acceptable and Otis time for a change. Since Prism has failed at every step we must now make the move to sever ties and allow progress to take place. Prism is holding back our downtown redevelopment with their constant changes, lack of funding, failure to make basic financial obligations, foreclosure, etc.

West orange deserves better than what Prism has done and the naysayers who live in the past of 50years ago need to step aside so we can make progress for the future ofour town and the hard working citizens.

Tom: Absolutely none of my comments are foolish; look to your own if you're seeking foolishness.

wohopeful: Again, you overview and analysis is innacurate and your position and opinion are shared by neither the Mayor and his Administration nor four-fifths of the Township Council. Prism has provided certified financial statements that attest to its solvency and ability to proceed, which it plans to do in short order.

Mr. Simon, I am a bit confused. By definition, a company's audited financial statement has been prepared and certified by a Certified Public Accountant (the auditor). In the U.S., the auditor certifies that the financial statements meet the requirements of the U.S. GAAP. An auditor can have an unqualified opinion, in which he or she agrees with how the company prepared the statements, or a qualified opinion, in which he or she states which aspects of the company's statements he or she does not agree with. In extreme cases, the auditor may express no opinion on financial statements at all, in the case that the scope of the audit was insufficient.

Are you privy to what type of opinion was expressed by the auditor in this case, whether unqualified, qualified, or something else?

As clarified at tonight's Council Meeting:

Though CPA prepared, the FY2011 financial statemements provided by Prism are not audited; rather, they are what was compiled to file federal corporate tax returns.

As confirmed by even Councilman Krakoviak, nothing nefarious or lacking should be infered by the wording of the auditor's staement.

Councilman Guarino committed to forwarding a copy and I may have more comments if warranted.

Gary
I think we all know "Nothing else matters"... To you

Tom:

OK, let's look at this another way; why should I, or anyone else, care whether or not you qualify to take out a second mortgage on your house, in order that you may build an addition to it?

It really doesn't have any material effect on anyone, does it and can I effect your situation one way or the other by reviewing your financial statements?

Nope.

Accordingly, the matter is between you and your lending institution and nobody else.

Concerned:

It's just an educated guess but, I tend to think the financial disclosure requirements for a typical going corporation looking for financing, and real estate development enterprise with no income, are two entirely different kettles of fish.

I'm also fairly confident that, having been down this road numerous times given the nature of its business, Prism is poised to provide precisely what will be required by the institutions interested and that they're courting.

Mr. Englert, as the cliche' goes, let's cross the bridge when we get there.

Concerned:

It's actually not a bridge that "we" have to cross as it's totally Prism's purview and something they're apparently in the middle of as we speak.

The fact that they've been carrying this poject for six years with no income being generated by it, and that they are doing so with revenues from other endeavors is manifest...and the curiosity about their financial condition is really immaterial.

They need to secure a final piece of the financial puzzle that they couldn't do without the requisite approval in hand and are involved in doing just that now.

Concerned:

It's been a few months since I've done so but, doing a google search for "Construction Projects Abandoned Since 2008" will provide news articles and pictures of a slew of them; Las Vegas being among those places particularly hard hit.

The stories are pretty much the same; funding withdrawn by banks in extremis and builders-developers lacking the resources to weather the storm.

Read a few of those stories and you'll have a far better appreciation for Prism...and understanding of what could have happened in West Orange and hasn't.

I have 2 examples. Both in West Orange. The condo's at Crystal lake. The original project and property went through various owners and sat idle for years. The original project was advertised in the New York Times Sunday edition, million dollar homes with free dock privileged for boating at the lake. In the end it turned into just another average condo development.

The other one, the condos in the Quarry at Eagle Rock. It eventually was built but sat empty for a long time. Well not empty, their was one tenant for at least 7 years.

Paul P: I fail to see either examples of "what" you're trying to illustrate or the point you are trying to make.

Crownview (the development in what was once the Eagle Rock Quarry) has been completed and fully occupied for 20 years.

The Pointe at Crystal Lake (formerly a swim club) is a stellar example of the McKeon Administration's positively mitigating the impact of development, as what what was approved for the site was three office buildings equal in size to the one that exists.

Had that plan gone through, it would have added another 1,000 vehicles on Prospect Avenue during peak morning and afternoon drive times. What was negotiated was the mixed-use, commercial/residential scheme that currently exists that served to reduce traffice volume and minimal impact on schools and municipal services.

It also resulted in the developer building OSPAC and gifting it, the land on which it sits and Crystal Lake to the Township as publix amenities.

If any of that is a bad thing, I fail to see where.

Those were examples of 2 projects that sat idle during a recession. And fyi, The Pointe At Crystal Lake is a shining example of a project West Orange originally planned as an enclave for the wealthy. During the build it and they will flock to West Orange, and we will be awash in rateables and wealth. Then the recession and it was idle. For years. Changed owners at least 4 times.

And I am correct that the Crownview was an empty building with one tenant for at least 7 years, until the recession ended and people started buying them, at way below market value. Another enclave build for and advertised as place for the wealthier tenants, and sold for a pittance per unit.

Sound familiar?

Paul P:

I'm still not at all sure what point you are trying to make and how it is relevant to this discussion. Do, as a general rule, housing starts and construction projects tend to slow/stall during recessions? Yes...no big news there!

The Pointe at Crystal Lake, however, moved rapidly to completion of construction (circa 2000-1) after having been acquired and developed by Millenium Homes. A gated community that gives way to some of the most exclusive homes in West Orange (overlooking NYC on Eagle Ridge Way), the complex has luxury amenities (gym, pool, public rooms) and price points from $400-700K: luxury by most any standard.

Your characterization of Crownview (also developed by Millenium, as is Vizcaya), if it was ever true (which I sincerely doubt), is certainly not the case now.

My latest blog post covering the February 19 council meeting and Prism's 2011-2010 financial statements is here at http://bit.ly/11Y4T0m. Thanks, Joe

@Concerned - Apologies for unclear language. I posted further information from Prism's financials in my blog covering the February 19 council meeting, not the financials themselves. Sorry for the confusion. Regards, Joe