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Edison Village Opposition is Unfounded

Historical perspective helps with most things and Edison Village is no exception ...

Just how much financial "risk" accrues to any single taxpayer through the Township's issuance of $6.3 Million in general obligation bonds in support of the project?

Not very much at all, really.

First the township bonding authority is detailed in state law, with the allowable value of bonds a municipality can issue predicated on its total assessed property value.

At present, the township has outstanding bond obligations equal to less than 1/3 of its total bonding authority and enjoys an excellent credit rating; the issuance of $6.3 Million in bonds would not adversely effect either.

If however the absolute worst case scenario were to come about ... Edison Village/Prism goes belly up, they can't make their payments, can't sell and/or we get tied up for years in litigation to collect monies due ... here's what the effect would be on the typical taxpayer:

1. If the Township decided to retire the bonds with a one-time assessment (unlikely): a one-time payment of $350 for every property owner (+/- 18,000)

2. If the Township decided to repay the bonds over their 30 year term (likely): an annual payment of $24 per year for 30 years for every property owner (+/- 18,000)

Those are pretty big "ifs" and given something that the people putting $250 million into Main Street aren't about to let that happen very easily.

Still, redevelopment is a complicated process and missing from the most recent debate is a summary of things decided years ago for reasons that color the entire project.

Why formal redevelopment and tax incentives are necessary here is because the parcel is not conducive for fully private investment without them.

Like it or not, the battery factory has historic significance as status as such been given it by both the state and federal governments.

Second, the building itself is made of Edison's own design and using his proprietary formula for concrete and will likely outlast the pyramids of Egypt; if it could be demolished (and it can't, see preceding point) the cost would be extraordinary and prohibitive.

Last, because the property was an industrial site long before environmental concerns were on anyone's radar screen, the property required substantial site remediation (already accomplished) overseen by the DEP.

What all of this means is that redeveloping this property will require an investment of +/- $112 Million to construct a complex that will have an assessed value of $80 Million.

Can anyone get a (legitimate) mortgage on a home equal to 40% more than its value?

No, and investors aren't lining up to back such a project without some incentive that makes it palatable and that incentive is the PILOT (Payment in Lieu of Taxes) Program and willingness to assist with providing advantageous financing of $6.3 Million (the bond) for infrastructure and public amenities.

This dynamic would apply to any investor and to whatever fanciful alternative uses one might think preferable, as those that were willing to make the investment agreed on one point: a mixed use (commercial-residential) is what was appropriate for the site.

That people are willing to turn their nose up at a $250 million investment in our community ... in the face of risk so small as to be non-existent ... is simply mind boggling to me; particularly given this debate has gone on for 50 years.

This post is contributed by a community member. The views expressed in this blog are those of the author and do not necessarily reflect those of Patch Media Corporation. Everyone is welcome to submit a post to Patch. If you'd like to post a blog, go here to get started.

Paul P March 27, 2012 at 02:48 PM
Even if this project succeeds , it still fails. Turning downtown into a mini city. Good idea ! The already over 10 min drive from end of Main street to the other, deters me and many others, from shopping, eating, or doing anything in that area anymore.
Cynthia Cumming March 27, 2012 at 03:14 PM
Traffic issues will have to be addressed throughout the course of the project. Yes, it will be an inconvenience during construction and as traffic patterns are changed. But that doesn't equate to failure.
Tom G. March 27, 2012 at 04:08 PM
@Cynthia - I think Paul P. is concerned about additional traffic from residents traveling to and from the apartment complex once it is completed. I agree Main St. is currently very slow, but the biggest problem isn't the number of vehicles, it's the poor timing of the traffic lights. For example, the intersection of Main St. and Franklin Ave. (across from Washington School) is basically a 3-way light, but stays red much too long for cars traveling along Main St. I waited almost 2 minutes while no vehicles entered Main St. from Franklin or Llewellyn Ave. Then drive just 50 feet and you have another traffic light at Main St. and Washington. By increasing the length of green along Main St. it would easily help move traffic along more efficiently. This is something that could (and should) be done now.
Gary Englert March 27, 2012 at 04:38 PM
@ jamie: Anonymous, unsubstantiated nonsense is nothing more than anonymous, unsubstantiated nonsense. Coupled with anonymous character assassination without basis in fact and it's repugnant.
Gary Englert March 27, 2012 at 04:40 PM
@ Ralph: I'm well aware of the dynamics of Internet message boards and the incivility bred by anonymous posting which, more often than not, is nonsensical and not rooted in fact. My admonishment is towards people keeping that very salient point in mind when reading whatever is posted here. The area in and around the Edison site is blighted and it is precisely that condition that the project is designed to address. Those anonymously stating the project is doomed to fail, that something else would be preferable and that no public participation is necessary simply do not understand and acknowledge the history and challenges inherent in redeveloping the site. We have a good plan in place and nobody is waiting in the wings with something better...after 50 years of wishing and hoping.
Gary Englert March 27, 2012 at 04:50 PM
@ Paul P: We have an over abundance of very subjective personal opinions with a dearth of alternate proposals that anyone with the requisite knowledge, expertise and financial resources is willing to fund. While far from a precise science, logic and common sense tend to indicate that the primary traffic flow, to and from the site, will be north and south from Route 280 (east bound exits on Mt. Pleasant, west bound at Northfield Avenue) and not likely to add significantly to that on Main Street north of the site.
Cynthia Cumming March 27, 2012 at 05:30 PM
As a downtown resident, traffic along Main Street is sometimes backed up, especially at certain times of the day. I would think that the developers and township will figure out alternative entrances/exits and traffic patterns to accommodate the development and the town residents as well. Since this is the oldest part of town, the two lane road that is Main Street has most definitely been problematic. This would have to be addressed in creative and manageable ways by Prism and the town.
Gary Englert March 27, 2012 at 05:33 PM
@ Tom G: The timing of traffic lights at Washington Street & Main, and Main Street & Harrison, is far more likely designed to accomodate pedestrians/children rather than traffic. Do keep in mind those crossings serve two public schools, a child care/nursery school, the Township pool and a major playground, with crossing guards on duty on during the school year and then only for an hour or so before and after school. While some adjustment might be reasonable, there is generally some logic and thought behind why such things are the way they are.
Gary Englert March 27, 2012 at 05:37 PM
@ Cynthia Cumming: Surely, traffic light timing along Main Street will likely be adjusted as Edison village comes to fruition. Unless I'm mistaken, a new traffic control will be installed on Main Street at either Charles Street or Lakeside Avenue as part and parcel of the project.
jamie March 27, 2012 at 09:29 PM
You said that potential renters already live within a 5 mile radius. What towns are within 5 miles of main street? Hmm. That's exactly the population West Orange needs to attract which it seems to have already i.e. the spike of crime being reported in this town. And again what makes West Orange a spot where successful young adults would be willing to relocate to? There's nothing here that would remotely make me want to move to West Orange as oppose to moving to Hoboken or Jersey City. Those towns have a nightlife , convenience because of its close proximity to NYC, and accessible transportation throughout the day. That would be a better investment than to get a condo in downtown West Orange. Lastly, an anonymous poster would have no name associated with their posts. You keep replying with the same response to anyone who seems to disagree or have an opinion other than what you are willing to hear. I'm writing from the fact that I fit the demographic of what these builders assume would be interested in moving to these condos and frankly I don't see that as true. If west orange wanted to revitalize that area of West Orange there's got to be a better idea
Gary Englert March 27, 2012 at 10:18 PM
@ jamie: Whatevever the opinion they espouse, the problem with anonymous posters is that they offer no credentials that supports whatever opinion they are offering. You might claim to have whatever expertise that suits the situation and construct an accompanying personna that exists only in your imagination. Many anonyomous posters do exactly that and also go on to concoct a variety of screen names in an effort to convey that opinion slants in whatever direction they're leaning. While jumping on the bandwagon of another (and anonymously suggesting I don't live here), you continue to offer a very subjective opinion about the project's success and then opine "there's got to be a better idea." Well, while you're entitled to your opinions, they really are really pretty much inconsequential and would be whether they were anonymous or attributable to an identifiable human being. Why? Money. How so? Because you aren't investing a penny of your own in the project and any and all of those who are (and those that would have) believe that this is precisely the type of development that will work best on the site. Purely and simply, you are belaboring decisions reviewed, debated and made nearly a decade ago and it's simply water under the bridge. What you think does not make it so...and it isn't.
jamie March 27, 2012 at 10:37 PM
You dont get elected into your position I take it because if you spoke with this demeanor I would find it hard to believe that you come across as likeable. Also do you get paid to keep an eye on this site and just blog? Seems like that's where you spend most of your time.
john anthony prignano March 27, 2012 at 10:41 PM
..... i would think that the developers and township will figure out..... Main Street is a County road . What say they ?
Gary Englert March 27, 2012 at 11:03 PM
@ jamie: Your ignorance of local civic affairs and government in general is showing for you to suggest I hold any public, non-voluntary position or get paid to voice my opinion. Though embarassing typos do happen, I've long since matered the intricacies of Blackberries and smart phones, posting on the run is no big thing. Lastly, this is my first blog and you're here by your own choice; come with an open mind and learn something, or not, it's still your choice to be here. What you perceive as a person less than likeable is thought by more to be concise and to the point...which is quite appropriate as this is a discussion of local civics and not a poetry reading contest.
john anthony prignano March 27, 2012 at 11:20 PM
Jamie Who is this Gary R. Englert Legislature / Legislative General Assembly Members , Staff Services Division Director, Managerial Unit M .at a listed salary of $97k+ ? By the way , Atlantic City is hosting a Hair - Splitters Convention this weekend
Gary Englert March 28, 2012 at 12:20 AM
@ john anthony prignano: More precisely, would you care to share some of your own resume, with more accuracy than you do mine?
Cynthia Cumming March 28, 2012 at 12:33 AM
Towns within a 5 mile radius? Montclair, Maplewood, South Orange, Caldwell, Cedar Grove, Verona, West Caldwell, and Livingston, to name a few... not just the towns you're implying. And again, just because you're not part of the demographic that the project would appeal to doesn't make it a failure.
Gary Englert March 28, 2012 at 12:41 AM
All personal and subjective opinions aside, can anyone possibly suggest that Edison Village won't happily fill the specific needs of a scant 333 future renters, in a state with a population of over 8 million? No, of course you can't and thus is the fundamental problem with the basis of any such argument.
Tom G. March 28, 2012 at 12:10 PM
@Gary - while I am in favor of this project, nobody can guarantee it will be successful any more than anyone can guarantee it won't be. I'm sure every developer who has ever built an apartment complex thought it would be easy to fill a "scant" number of apartments, but we all know not every apartment project is a success. I have read bad reviews of alleged "luxury" apartment complexes in Bloomfield and East Orange (you can find them on the city-data.com NJ forum). People complained of bug/rodent infestations, excessive rent increases, etc. I'm not suggesting that will happen with this project, but just putting it out there that these types of things can happen and are unpredictable.
Gary Englert March 28, 2012 at 01:04 PM
@ Tom G: We've long since reached a point where those voicing objections to the project begin their commentary with "I don't think..., I wouldn't pay...or I'd rather see...," all of which are very subjective, individual opinions with neither the requisite historical perspective nor any personal financial commitment. Fact: The discussion of what to do with the battery factory has been going on for 50 years, earnest work on redevelopment for 22 years and a fundable plan in place for most of the last decade. Fact: The challenges presented by the building (historic designation, inability to demolish and environmental site remediation) call for an in vestment of +/- $112 Million to construct what will have an assessed value of $80 Million; this is why it was designated a redevelopment project and why tax abatement (PILOT) is essential to its success. Fact: The Council's redevelopment sub-committee labored for 18 months to arrive at the best possible deal for the Township and to draft the relevant ordinances. Mr. Krakoviak had ample opportunity to address his concerns and seek whatever amendments he thought necessary but, rather than do that, agreed to bring the matter to a vote for what appears to be political grandstanding. This served nobody well. (To be continued...)
Gary Englert March 28, 2012 at 01:20 PM
Fact: The plan on the table is the best of those submitted by those developers willing to invest in the project; all agreeing that a mixed use (residential-commercial) of the type approved what was appropriate for the site. Personal opinions that "something else would be preferable" are just so much wasted breath, as the decision has been made and nobody with the resources to bring such a project to fruition is willing to fund anything else. Fact: True, nobody can guarantee success with any endeavor and this is no exception but, common sense tells me (and the folks putting their money where their mouths are) that finding 333 willing tenants in a pool of 8 Million won't be akin to crawling over hot coals and busted glass. Fact: The "risk" to the Township (and the individual taxpayer) has been identified, contained and is, at worst, remote. Anyone thinking some knight on a white horse is wating in the wings with a proposal better than what is already on the table simply doesn't understand the terrain on which we currently find ourselves deployed or how we got here and why. The true absurdity here is that an organization is showing considerable faith in our community and is willing to invest a quarter of a billion dollars in it, while people living here are coming up with every nonsensical reason imaginable to discourage them from doing it. It is mind boggling!
Will Rod March 28, 2012 at 01:41 PM
Fact: you use the word fact the proceed to state your opinion. Fact: what most residents are concerned about is the unknown costs of this project if it doesn't go according to projections. Namely, what if the developer can't rent the 333 units at the prices he wants. Naturally, having invested money into the project, prism would lower the rents until he achieves occupancy. That would have an impact on school projections, police, bond payments, etc. it's not magnitude of pontential tax increases that upsets people, it's the idea of them period. I don't care if it's $1, I'm already taxed enough!
Gary Englert March 28, 2012 at 02:03 PM
@ Will Rod: Each and every word I have written in the preceding post (preceded by the word Fact:") is 100% factual and not an expression of personal opinion. Again, the absolute worst case scenario risk to the taxpayer (however remoted) HAS been identified: $24 a year for 30 years (likely) or a one time $350 payment (unlikely) to satisfy the bond. The effect on all else (schools, police, fire, etc.) will be negligible. If you don't believe that a revitalized downtown will have a corresponding positive effect on the community and your personal property values, there's not lilkely to be a way to convince you otherwise.
Will Rod March 28, 2012 at 03:17 PM
Opinion: "the best possible deal for the Township" Opinion: "Mr. Krakoviak had ample opportunity to address his concerns and seek whatever amendments he thought necessary but, rather than do that, agreed to bring the matter to a vote for what appears to be political grandstanding. This served nobody well." Opinion: "common sense tells me (and the folks putting their money where their mouths are) that finding 333 willing tenants in a pool of 8 Million won't be akin to crawling over hot coals and busted glass." Opinion: "The "risk" to the Township (and the individual taxpayer) has been identified, contained and is, at worst, remote." Just thought Id help you out by pointing out the above. Look, Im not saying you are not entitled to your opinion, we ALL are. Ill agree with you about one thing, this was over long before it began. The only way to truly affect change going forward is to vote for new leadership. Joe K voted no on this project, he therefore has my vote in the upcoming election and anyone else associaed with him. I encourage others to do the same.
Gary Englert March 28, 2012 at 03:35 PM
@ Will Rod: That Mr. Krakoviak sat for 18 months on the committee charged with forging "the best possible deal for the Township" is a fact. The risk HAS been identified and is quantifiable and, all things being relative, the risk IS minimal...as it is little more than we routinely do on a regular basis but, without benefit of a specific income source to fund it. That Mr. Krakoviak had 18 months "to address his concerns and seek whatever amendments he thought necessary" is also a fact and if it walks like a duck and talks like a duck, chances are it's a duck...and I didn't have to get hit in the chest with an AK-47 round to know that Communist aggression was a factor in Indochina. The conversation I, and everyone else should be having with Joe Krakoviak is why he agreed to bring this thing before the Council if he didn't think it was ready? And what did he accomplish by sitting on that committee for 18 months, if not addressing these concerns and forging the best deal possible for West Orange?
Gary Englert March 28, 2012 at 03:46 PM
And it is most certainly a fact that the people putting up the dough do not believe that renting the units will be a heavy lift.
Ryan March 28, 2012 at 05:59 PM
Cynthia, we don't need the likes of Montclair or South Orange residents moving to our town, bringing their Prius-driving, community-gardening, public-education-supporting values to our town. We have too many of that element already. ;)
Tom G. March 28, 2012 at 06:28 PM
@Cynthia - exactly, and I'm sure the "other" towns within a 5-mile radius (Orange, East Orange) that the person was referring to don't have many residents with the ability to drop $3k on an apartment. If they did, they probably wouldn't be living in Orange or EO to begin with.
Adam Kraemer January 22, 2014 at 09:50 PM
It the project is so great why can't the market support this with out tax payer backed loans and special tax deals? Get the government out of this. Developers can tax the risk and get the down side or upside depending on the market.
Gary Englert January 26, 2014 at 01:10 AM
Adam Kraemer: While the inactivity with the Edison redevelopment project has long since become as troubling to me as it is to most everyone else, you continue to regurgitate fundamental questions asked and answered years ago...and the answers negate the suggestion that this project would ever occur, or succeed, were it to rely strictly on market forces. Fundamental to the matter, as stated ad nauseum, is that the building's historic designations and environmental remediation require an investment of $30 Million more than the property will ever be worth on build out. Tax abatement is the long accepted mechanism to encourage re-development of such properties. Without it, all West Orange could look forward to is an ever deteriorating eyesore on Main Street.

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