An ill-conceived partial State takeover of Trenton

The Trenton Times reported in “A ‘Capital’ idea that may improve Trenton” that a state agency, the Capitol City Redevelopment Corporation (CCRC), is seeking the power to use taxpayer dollars through bonds and fees to become a developer in downtown Trenton.  Assemblywoman Bonnie Watson Coleman, is pushing this bill through the legislature.

Bill “S-3116” greatly expands the role of CCRC by

  • Board Composition – Adds the Commissioner of Transportation and the Commissioner of Community Affairs to the board of directors of the CCRC to replace two gubernatorial appointments and adds two more public members to the board. Of the seven public members, four shall be appointed by the Mayor of the City of Trenton and three shall be appointed by the Governor. In addition, the bill provides for staggered terms of the board members appointed by the Mayor;
  • Gubernatorial Veto – Provides for gubernatorial veto of the minutes of board meetings;
  • Conflict of Interest – Prohibits a member, officer, employee or agent of the CCRC from being interested, either directly or indirectly, in any school facilities project, or in any contract, sale, purchase, lease, or transfer of real or personal property to which the CCRC is a party;
  • Oversight Committee – Eliminates the Capital District Oversight Committee;
  • Loan & Grant Fund Management – Transfers the management of the Capital City Redevelopment Loan and Grant Fund from the State Treasurer to the CCRC;
  • Borrowing Capacity – Authorizes the CCRC to borrow money and issue bonds and notes and other obligations of the CCRC;
  • Fee Collection – Permits the CCRC to charge and collect fees;
  • Marketing – Allows the CCRC to market all private development projects undertaken within the Capital City District;
  • Joint Partnerships – Permits the CCRC to enter into partnerships or joint ventures with private developers and public entities for the purpose of community redevelopment;
  • Redevelopment Authority – Authorizes the CCRC to act as a municipal redevelopment entity on behalf of the City of Trenton and authorizes the CCRC to act as the redevelopment entity on behalf of the State for any State surplus property located within the Capital District; and
  • Subsidiaries – Allows the CCRC to form, purchase or assume control of one or more subsidiaries.

What good can come of this?

  • If you read the above with a suspicious eye, as one should when reviewing political deals, you’ll recognize the potential for malfeasance.
  • The first four bullets describe who gets to feed from this trough of political favors and the second seven bullets describe the trough.
  • How would you fee if the state created an authority to exert this kind of control over your neighborhood?

The citizens of NJ and their legislatures should tread lightly on the relationship between the citizens of Trenton and their government. If the state seeks to take over Trenton as it has in Camden, then the Governor should be clear about it. This proposed “half takeover” leaves the citizens of Trenton in a governmental limbo.

The history of urban revitalization shows government spending as the problem, not the solution.  Government gave us Rt. 29 which cut off our waterfront, Canal Banks which destroyed a neighborhood through urban renewal and arenas that don’t stimulate revitalization. The state built a $105M tunnel in Trenton that doesn’t accommodate commercial traffic as intended. In 2004, Trenton’s government supported a developer’s plan to bulldoze 8 square blocks of the South Ward through the use of eminent domain. Another quasi-governmental agency, Trenton Housing Authority sought to get federal funds to build a new HOPE VI project in South Trenton, which luckily failed and instead a private developer has built market rate townhomes on the same property.

Even today, NJHMFA, another government enabled “authority” continues to fund Trenton development only when those developments include subsidized housing. Most Trentonian’s agree that we’ve absorbed too much subsidized housing in the city. Yet NJHMFA continues to force us to take it as a pre-condition for its help in funding revitalization. In this regard, NJHMFA is rogue authority.

Famed urban studies author Jane Jacobs called government revitalization money “cataclysmic”. She goes on to link the availability of government money to the rise of underworld influence.  This bill would be a disaster as it puts Trenton’s fate in the hands of non-elected government bureaucrats.

CCRC and its board won’t have their own financial skin in the game rather they will be playing with yours and my money. Despite the best intentions of the individuals involved, they will be subject to non-economic political forces that will warp this use of taxpayer funds. CCRC claims that they are self-sufficient which is disingenuous. If they didn’t depend on the power of the government to force tax collection, pay debts and levy fees they would be better off being a private development company. But they’re not a developer; they are a government agency pretending to be one.

There are developers in Trenton who will support this measure as they may benefit from the largesse the CCRC will be able to throw around. But on whose back is that largesse created? The answer is the taxpayers of NJ and the common citizens of Trenton. The opportunity for government to enrich a few and the expense of the many will be ever present in the CCRC after the adoption of this bill.

To be clear, Reinvent Trenton desperately wants developers to be successful in Trenton. But trampling on the rights of citizens is no way to do it. Further confusing the role of government is no way to encourage progress.

Developers in Trenton will all be happy if

  • the state would simply sell off its downtown Trenton property (i.e. the parking lots)
  • the city of Trenton could streamline its technical inspections operations
  • NJHMFA could lend money at good rates but not complicate the development process with subsidized housing requirements

Citizens would be happy if when developers bought these state lands, those lands were immediately returned to the tax rolls by virtue of a land tax. A land tax would discourage speculation and encourage development as the value of the improvement would be taxed at a lower rate than today. (See The “Reinvent Trenton” Guide to Fixing the Budget)

But this is not what Bonnie Watson Coleman is proposing (the bill is sponsored by Senators Raymond J. Lesniak and Joseph M. Kyrillos Jr.). Rather than proposing government get out of the way of the development process, they propose that government take a bigger role in it.

Is this what Trentonians and New Jerseyeans want their government to do?

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4 Responses to “An ill-conceived partial State takeover of Trenton”

  • Taneshia:

    A few things:

    I believe you’re confusing HMFA with COAH. Also, HMFA is designed to fund affordable housing when you look at its subsidy programs but it also has financing programs (construction and permanent financing) for mixed-income housing which I suggest that Trenton needs. Trenton Ferry is exhibit number one.

    But essentionally HMFA functions like all state-based housing financing agencies across the country.

    A personal email was sent to you addressing your assertions point-by point. Did you read it? Are you familiar with CCRC’s existing rules and regulations? I can send you the statute, but it’s also available online.

    I believe your R party-line, anti-government bias is peeking through here Dan but you may be interested to know that I’m pretty sure that CCRC was set up by a Republican! The state wanted to work with the city on redevelopment but was, naturally, concerned about protecting its own interest and still is when it comes to redeveloping existing state-owned parcels as ratables.

  • The expansion of CCRC powers hasn’t been discussed in Trenton. Did council vote on it? Did the public vote on it.

    Trentonians shouldn’t have to accept this bill that only a few “in the know politicos” know about.

    Don’t really know who set up CCRC but this expansion of powers creates an entirely different animal.

    You say that a philosophical and economic preference for limited government is bad. It’s only bad for people that are too used to depending on government handouts to know or care about the difference.

    Let’s have a clean delineation between business and government so the two don’t mix. Corruption is the result of mixing the two.

    And anyway, what’s the rush in passing this bill. Why not wait a couple of weeks until the new Governor is in place?

  • Elise:

    I am not sure where this train of thought is coming from—the proposed CCRC sounds to me like a redevelopment authority which are usually given the leeway to do the things you are criticizing.

    Unfortunately I am only familiar with one redevelopment authority where I have lived–the Boston Redevelopment Authority. The head is appointed by the mayor but it works independently (and closely) with the mayor. It does have the authority to float bonds etc.

    It might be worth researching other redevelopment authorities to see what their scope of practice is. I find NJ to be overly controlled by the state legislature on these matters so it would be best to look outside NJ for similar examples.

  • Elise,

    Experience tells one that it is only too difficult to work “independently (and closely) with the mayor.” Working closely with someone means working in tandem. Working independently means working on one’s own. So, which is it? And what will such a program mean to Trenton?

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