The Jersey City Council continued to debate the controversial Centre Pompidou plan ahead of a final vote on a proposed 30-year tax abatement for the KRE Group at 808 Pavonia Ave.
By Daniel Ulloa/Hudson County View
Business Administrator John Metro said the council will be receiving an updated budget, noting that a Special Improvement District (SID) would be established to help provide an annual $1.5 million allocation from the city, echoing what Mayor Steven Fulop said at Saturday’s Journal Square Community Association meeting.
“We’re going to break that down,” Metro noted, continuing that the state tax credit line item is about $70 million, not to be confused with the $48 million state budget allocation from the New Jersey Economic Development Authority to prior to them pulling their support in June.
“These are state tax credits that were approved for projects of this size and were solidified,” he added.
The 10-year budget for the project released after Saturday’s meeting has an $11.5 million allocation from state tax credits in year one, and a total of $67.5 million over duration of the whole upcoming decade
However, a spokesperson from the NJEDA has a different perspective.
“The Centre Pompidou project has not been approved for any tax incentives from the NJEDA. The museum could be eligible for incentives under our Cultural Arts & Facilities Program, but applications for the program have not yet opened. As with all our tax incentive programs, applications would have to be approved by our board.”
“We have taken time to review the plan in depth, and it is evident that strides have been made in identifying funding sources, including substantial State appropriations and potential tax credits under the recently-enacted Cultural Arts Incentives Program,” NJEDA CEO Tim Sullivan wrote in an April 26th letter to JCRA Executive Director Diana Jeffrey.
The letter came just over two months before the NJEDA pulled their support for the project.
Ward F Councilman Frank “Educational” Gilmore asked what happens if the Pompidou project never ends up coming to fruition.
Council President Joyce Watterman noted that she wanted to see if a recreation center could be built there instead of a museum in the event the Pompidou pulls out after the city owns the building.
Metro said that in that scenario, the building would be available for public use that would be designated by the city.
“Political suicide,” Ward C Councilman Rich Boggiano yelled out.
KRE Group attorney Jim McCann came to the podium to answer Gilmore’s question.
“In the unlikely event, that that were to happen, there’s a site plan approval in place for the construction of the building already. If there’s a financial agreement in place from the city council, the financial agreement would be binding on the developer,” he stated.
“If the project fell through, unlikely for financing purposes, everything would still stay in place once the plan is amended to incorporate the museum, yes another developer could come in and complete the project … My client recently acquired the property and so they’re full speed ahead if this financial agreement is approved.”
Gilmore continued by asking how long it would take to start construction if the abatement is approved Wednesday, to which McCann said they could start building in spring 2025, noting that the redevelopment agreement with the Jersey City Redevelopment Agency needs to be amended.
“Correct me if I’m wrong, I thought the reason why we had to do this yesterday as because finances was dictating shovels going in the ground in September?” Gilmore said.
McCann said demolition and site prep will be underway in short order pending tomorrow’s vote, but actual construction is still a ways off.
“With the financing and the projects getting underway, the entity had already had plans to get underway now. We asked them to stall for a few weeks to get this idea on the table with the potential for a PILOT and a cultural space,” Metro said.
Gilmore still seemed miffed about why the project was being fast tracked.
Housing, Economic Development, and Commerce Department Director Annisia Cialone said the local payment in lieu of taxes (PILOT) ordinance requires a vote prior to them beginning construction, otherwise they would not be eligible.
KRE Group President Jonathan Kushner was in attendance and offered to provide more clarity.
“In order to construct the museum to the requirements and specs the Pompidou needs, from what we’ve been told from their consultants and their team … They will need about 10,000 feet of sub-cellar space and are building two,” he said.
“In order to access that, it will require building [tower] one’s sub-cellar, so we actually need to know are we building two or are we building one. The sub-cellars are connected.”
Gilmore also wanted to know how long demolition would take, to which Kushner said one to two months, which would allow construction to begin in January as long as the demolition commenced in October.
“Getting construction financing is incredibly difficult. If you speak to anyone that does any building, or anything in the city, it’s like getting a colonoscopy nowadays just because the interest rate is higher, the turnaround is 12 months versus 18 months, so the timelines and the return on investment with the banks are requesting is a shorter time period,” said Ward D Councilman Yousef Saleh.
Gilmore said he didn’t want to make a rushed decision with so many questions still unanswered, while Watterman wanted to add a whereas clause that identified what the building could be used for if the Pompidou doesn’t pan out.
“We can emphasize that,” Metro said.
“I am really hesitant to tie a future council to one use,” Saleh said.
“Parents need a space to take their children. We have two senior sites we own,” Watterman said.
Boggiano also said they shouldn’t be moving forward after just one public meeting, where it was made clear the project is not popular among Ward C residents.
“Is it possible for us to know this is real money? Is it possible to earmark those funds?” asked Ward A Councilwoman Denise Ridley, to which Metro said the administration would look into it.
Ward E Councilman James Solomon said the plan is for the city to fund the build out, but the council still does not have any cost estimates to work with.
“We know what the value of the white box is going into it and we know what OMA has presented are the needs are for facilitating that white box. We have an idea what needs to be put in,” Metro said.
“Do you have a ballpark figure?” Saleh asked.
Solomon interjected that he’d be fine with a range, to which Metro said he had to follow up with OMA.
The Jersey City Council convenes at City Hall, 280 Grove St., at 6 p.m., which will also stream live on Microsoft Teams.
While I think the politicos have already decided that this boondoggle will happen, how about a 30 year admission price break or free for actual NJ taxpayers who can show a paid property tax bill who will end up paying for it.