For decades New Brunswick, New Jersey was a run down college town, falling victim to urban decay, declining property taxes, and crime. The New Brunswick Development Corp.(DEVCO), local officials and private firms collaborated to redesign New Brunswick for the future. Urban planners would reinvigorate New Brunswick with a master plan that would draw families to the city.
According to a report the Press of Atlantic City website, the Middlesex County Improvement Authority (MCIA) did not honor its agreement to repay annual installment of a $20 million loan, for five years. The MCIA is in arrears to Casino Reinvestment Development Authority (CRDA) for $7 million 2005 loan.
Devco received accolades as an epitome of the collaboration of public funding and the private sector. So impressed with the framework, The Atlantic City Development Corporation is using the same model. Though praise runs high, repaying loans for the floundering Heldrich complex is raising public ire.
Managed Devco, the loan financed “The Heldrich,” a new downtown hotel and conference center. “CRDA will be paid, but it’s just going to take a couple more years,” commented attorney Christopher Paladino, who brokered the $20 million loan for the troubled hotel.
The Atlantic County Improvement Authority (ACIA) is readying a $120 million bond issue, for Stockton University construction project. Concern continues that a scenario like the New Brunswick dilemma may become a reality. ACIA bond counsel John Cantalupo commented, “This project and the New Brunswick hotel project is apples and oranges.”
In December of 2015, Governor Chris Christie enacted legislation prohibiting state agencies from issuing grants, loans and financing to private sector business and non-profits which fail to repay state-issued loans and bonds.
Established in 1975, non-profit real estate developer Devco spearheaded urban redevelopment projects New Brunswick, and other New Jersey municipalities.